The healthcare exchange model represents a potential sea change in benefits administration strategy. But while exchanges offer significant cost savings opportunities, they raise some challenging dilemmas around the role of both employers and employees in benefits programs.
Exchanges vary widely in terms of basic philosophies, approaches to provider networks, contracting and employee engagement. As a result, exchange options don’t readily lend themselves to apples-to-apples comparisons. Moreover, the use of exchanges requires Human Resources executives to make a fundamental decision: Will the employer narrowly define benefit choices for employees? Or will employees themselves bear the burden of choice and responsibility for selecting their plans?
These questions have far-reaching implications for HR sourcing strategy and can more broadly affect employee perceptions, workforce morale and corporate identity and brand. As such, the myriad options surrounding the implementation of exchanges require careful deliberation.
This ISG white paper examines the basic characteristics of the healthcare exchange model and outlines the strategic and tactical considerations HR executives must address when incorporating exchanges into benefit programs.
