| ||Fast Focus|
More than 100,000 employees from Sears and Darden Restaurants
will use Aon Hewitt’s healthcare exchange to select their
Employers using a private exchange use a defined contribution
strategy that gives each worker a set amount of credit to
choose from among a menu of insurance options.
Liazon’s Bright Choice Exchange is growing at a rate of
100% a year and recently signed deals with Gallagher Benefits
Services and Hub International.
Aon Hewitt’s insurance
“exchange” focuses an old idea in a new way. Will
it become the next wave in benefits?
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Chris Brathwaite, spokesman for Sears Holdings, says the Aon
Hewitt exchange represents a new way for Sears, which had been
“We are taking a new approach to medical coverage, an
approach that we think will better meet the needs of our
diverse workforce, while also providing our company with
increased efficiencies in our healthcare offerings due to the
competitive marketplace created by the new model,” he
says. “The corporate exchange creates a competitive
market in healthcare benefits at the individual consumer level,
and we’re optimistic that competitive forces will drive
efficiency and have a positive impact on quality and costs.
“This is not about shifting costs. It’s about
increasing associate choice and options for their healthcare,
and leveraging a competitive market to continue to positively
impact overall costs.”
Time for Homework
Mellard says brokers who want to succeed in the new world of
exchanges need to be learning all they can right now.
“I would be less studying those that are up and
running and more studying your client customer book,” she
says. “I think we know the profile of a customer that
would fit into a private exchange. It is an employer that is at
his or her limit on struggling year after year with trying to
hold the line on escalating healthcare costs. I think the
customer profile is one who is willing to make a serious
commitment to a focus on health and productivity—the
whole wellness piece. I think it’s an employer that is
willing to give up some control over their healthcare.
“Clearly the top three industries I see across the
board that seem to be most interested in going to a private
exchange right now are manufacturing, retail and healthcare.
You look at your customer base and which ones fit with that
profile. Then it’s sitting down and talking to them very
seriously about their level of interest and then finding the
right insurance carrier partners. I think those conversations
are happening all around the United States with all of those
brokers who will be surviving and thriving in 2014 and
“The brokers who become educated about the process and
about the best programs out there will win because they are
offering the best options and solutions to their
employers,” Klonk says. “It’s understanding
where this works, where it doesn’t work, the type of
workforce that this is going to be appropriate for and
educating your employers about where this is going to fit
right. Then the broker will win. If the broker sells this as a
catchall, it’s a mistake.”
Many employers for years have used the exchange-based
defined contribution model for health benefits for their
pre-Medicare eligible retirees. What’s different this
time is a heightened awareness of and focus on wellness and the
effect lifestyle has on health and healthcare costs.
“It’s ‘Back to the Future’ in some
ways, but I think we’re doing it differently because I
think we have been doing a good job about educating the
consumer, who is now more engaged in the purchase of healthcare
and more engaged in their own personal health and
well-being,” says Mellard. “I think it’s the
‘Perfect Storm’ right now."
Patten is a contributing writer.