Enrollment results from the industry's largest private health care exchange indicate that when given more choice and control, employees become more engaged and invested in selecting their health benefits. This is according to a new analysis from Aon Hewitt, the global human resources business of Aon plc.
During the 2013 annual enrollment period last fall, more than 100,000 U.S. employees successfully enrolled in health benefits through Aon Hewitt's Corporate Health Exchange, the only fully insured, multi-carrier corporate health exchange available to large national employers today. According to Aon Hewitt's post-enrollment analysis, almost 80 percent of enrollees felt confident they chose the health plan that offered the best value for them and their family, and almost all (93 percent) liked being able to choose among multiple carriers.
"When given more options, employees become empowered to make individual choices based on value, provider network, price and health status," said Ken Sperling, Aon Hewitt's national health exchange strategy leader. "Employees like having control over such an important decision and appreciate not being limited to a pre-determined plan and insurance company."
Aon Hewitt's Corporate Health Exchange consolidates purchasing power while providing best-in-market health insurance options for employees. Through its strong relationships with insurance providers, Aon Hewitt's Corporate Health Exchange offered a wide range of health, dental and vision benefits options from multiple national and regional carriers during the 2013 enrollment period, including UnitedHealthcare, Kaiser Permanente, HealthNet, Health Care Service Corporation (operating Blue Cross Plans in IL, NM, OK and TX) and Florida Blue, Florida's Blue Cross and Blue Shield Plan.
"Aon Hewitt's corporate exchange allowed us to move away from a one-size fits all approach to providing health benefits," said Danielle Kirgan, senior vice president of Total Rewards and Shared Services at Darden Restaurants, one of the companies participating in Aon Hewitt's corporate health care exchange in 2013. "This year, we were able to offer a broader array of health care choices than we have in the past, giving our employees the flexibility to choose the level of coverage that best meets their needs at a price they could afford."
During enrollment, employees could quickly and easily sort and filter benefits options by price, carrier and/or plan type using Aon Hewitt's proprietary exchange portal. Participating insurance providers highlight the unique features and capabilities of their plans to help employees differentiate between coverage options and optimize their choices. Aon Hewitt's benefits experts and advisors-including its industry-leading Advocacy Support team-provided expertise, answers to questions and guidance throughout the enrollment process.
Enrollment by Plan Type
According to Aon Hewitt's post-enrollment analysis, two-thirds of employees who participated in the corporate exchange said they now had a good understanding of how they share the cost of medical insurance with their employer. When choosing a coverage level, most employees said they based their choice on the desire to choose a plan that offered coverage similar to their current plan and price.
Aon Hewitt's enrollment data shows that 39 percent of employees enrolled in a consumer-driven health plan (CDHP), up from 12 percent in 2012. Conversely, the number of employees who enrolled in a PPO-type plan decreased from 70 percent in 2012 to 47 percent in 2013. However, while a significant number of employees migrated toward consumer-driven health plans, Aon Hewitt's data revealed that when given the choice, a fair number of employees chose to increase their coverage. For 2013, 32 percent of employees chose a plan similar in type to their current coverage (e.g., PPO to PPO), while 26 percent of employees chose richer coverage. Forty-two percent of employees chose to reduce their regular payroll contributions and select a less rich form of coverage.
According to Sperling, "The election patterns we observed prove that a well-designed exchange does not just drive employees to less comprehensive coverage. Employees who want richer coverage are free to purchase it-and they do. Health care is personal, and people have different needs. This model lets employees decide which plan and which insurance company is best for them, and they are free to modify that choice on an annual basis."
"We believe this new approach to medical coverage better meets the needs of our diverse workforce and provides our company with increased efficiencies in our health care offerings," said Dean Carter, chief human resources officer of Sears Holdings, another company participating in the exchange. "The competitive marketplace created by the corporate exchange model brings increased flexibility to group health coverage for our associates, giving participants a chance to choose both the level of coverage and the insurance company that best meets their needs. As a company committed to providing our associates with a comprehensive set of benefits, being able to have a positive impact on quality and costs through the exchange has been a win-win for Sears Holdings."
Increased Use of Decision-Support Tools
Use of Aon Hewitt's online decision support tools, including health plan comparisons, cost estimators and customized portal and guidance solutions, was significantly higher for employees who enrolled in their benefits through a corporate exchange model compared to the 10 million employees who completed a "traditional" enrollment with Aon Hewitt. Specifically:
- 68 percent of exchange enrollees used a health plan comparison tool compared with just 48 percent of employees in Aon Hewitt's normative database
- 57 percent used the provider search tool, compared to only 14 percent usage in traditional plan enrollment
"Our health care exchange is structured in a way that enables employers to continue offering group health care coverage but gives employees a wider range of plan choices," said Sperling. "It uses a fully insured model to create competition at a consumer level, and whenever markets are competitive, consumers benefit. This is not about shifting cost to employees; it's about reducing the top line cost of health care. We have created a solution for employers and employees that reverses the rate and volatility of escalating health care costs. Employers can then redirect these cost savings to enhancing company-wide programs to increase employee health, well-being and engagement."