8 million people enrolled in private exchanges for 2016 benefit plan year, Accenture finds

About eight million people enrolled in private health insurance exchanges for the 2016 benefit plan year, according to a report from Accenture. The report states there was a 35-percent increase from 2015 when enrollment was approximately six million.

“As administering health benefits becomes increasingly costly and complex, employers will explore new models to reduce cost and meet consumer demand for greater choice and more robust digital experiences,” said Rich Birhanzel, managing director of Accenture’s Health Administration Services. “The extent to which private exchanges succeed at differentiating themselves and proving their value over traditional benefits delivery plans will ultimately determine their future growth.”

Midsize companies. The growth of private health insurance exchanges continues to be fueled by midsize companies with 100 to 2,500 employees, according to the report. On the other hand, large employers have been slower to adopt private health exchanges. The report found the rate of adoption among large employers grew only slightly in 2015.

Recommendations. According to the report, to convince the remaining employers to adopt private exchanges, exchanges will need to do the following:

• demonstrate stabilization or reduction of year-over-year health care costs,
• reduce the administrative burden and
• satisfy today’s digital consumer.

“Private health insurance exchanges have a unique opportunity to capitalize on the market and regulatory forces that are compelling employers to change their approach to benefits,” Birhanzel said. “If current vendors can deliver on the key elements of a private exchange, they can capture share in a market that will continue to grow. If they cannot deliver meaningful differentiation, legacy providers will evolve to meet the market and regulatory needs that are driving the demand for private exchanges.”

SOURCE: www.accenture.com

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