Private health insurance exchanges: “A menu of health plan options”
When I was in Seattle on business a couple months ago I met Jonathan Rickert, CEO of an interesting company called Array Health. They are a start-up operation with aspirations to provide health plans with private exchanges that will give small businesses and individuals access to several health plan and ancillary benefit designs rather than the few they are typically exposed to today. Health plans are interested in opening these exchanges in order to capture a higher share of the new members gaining health insurance as a result of the Patient Protection and Affordable Care Act (PPACA), which is rolling out through 2014. There will also be public exchanges, but the big plans would rather have customers shop within their own stores (think Apple Store v. Best Buy).
This all fits in to an expected long-term shift from defined benefits to defined contribution that’s likely to unfold in a similar fashion to what we saw in the pension market, which has shifted dramatically from defined benefit to the 401(k) model.
The big health plans are still in the mainframe era and are not well placed to serve this emerging need. Of course they’re also nervous about working with newer companies on a business critical process. That’s why I’m so pleased to see Highmark Blue Cross Blue Shield announce its agreement with Array Health:
"We’re bringing a retail experience to the wholesale environment," said [Steve Nelson of Highmark]. "Highmark’s exchange will give small business employees a chance to truly choose a health plan option that’s right for them."
With a defined contribution approach, an employer sets a monthly fixed dollar allowance for employees. They use this money to go to an online insurance store to select from a menu of seven Highmark health plan options as well as two dental and vision insurance plan options.
"Our platform seamlessly packages health and ancillary products to look and feel just like a traditional group plan, which is what most employers, employees and brokers are familiar with, but also gives a menu of options," said Jonathan Rickert, Array Health CEO. "We have extensive experience in exchanges, and we look forward to bringing our expertise to the Pennsylvania marketplace with Highmark."
In the coming weeks I hope to have the opportunity to interview Array and Highmark about their new partnership. In the meantime, congratulations.
By David E. Williams, Med City News
About Array Health
Array Health is powering the retail health insurance revolution where individual consumers select the health benefits tailored to their needs. Since 2006, Array Health's Private Exchange platform has empowered employees to shop for health and ancillary insurance with greater choice and convenience, while enabling employers to control rising health care costs. From product shopping, enrollment, and administration, to billing and data exchange, Array Health's cloud-based platform handles it all. Learn more at www.arrayhealth.com.
About Highmark Inc.
Highmark Inc., based in Pittsburgh, is an independent licensee of the Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield plans. Highmark serves 4.8 million members in Pennsylvania and West Virginia through the company's health care benefits business and is one of the largest Blue plans in the nation. Highmark has 19,500 employees across the country. For more than 70 years, Highmark's commitment to the community has consistently been among the company's highest priorities as it strives to positively impact the communities where we do business. For more information, visit www.highmark.com.
Tel.: 1 (800) 640-7086