Research by SelectQuote Benefit Solutions, a provider of insurance exchange services, reveals three ways private health care exchanges can aid employees in planning for retirement.
1. Adopting a private insurance exchange can help retirees’ manage health care costs.
A survey conducted by the Private Exchange Evaluation Collaborative (PEEC) found 45% of employers have implemented private exchanges, or plan to do so before 2018, for their full-time active employees. Thirty-seven percent have implemented, or are considering implementing, private exchanges for pre-65 retirees and 32% for their post-65 retirees.
“Insurance exchanges allow retirees to shop for the best plan to fit their needs using side-by-side price comparisons,” says Tom Grant, president of SelectQuote Senior, based in Kansas City, Kansas. “This empowers retirees, helping them to save time and money.”
Grant tells PLANSPONSOR, “As private exchanges are adopted within an organization, plan sponsors can help employees transition by providing customized communication around transition dates and benefit options, and by creating a dedicated point of reference for questions, enrollment and additional plan information. In addition, plan sponsors can secure a partner that will treat employees with the same level of excellence that the employer would.”
2. Offering choices allows retirees flexible options to fit their lifestyle needs.
Gone are the days of one-size-fits-all group retirement plans, says Grant. “Retirees all have different needs and retirement plan offerings should reflect that.” He points to the PEEC survey, where more than 80% of employers say they find it important to offer flexible plans with many choices for their retirees. By using comparison shopping, exchanges provide a variety of options available to fit retirees’ individual needs.
“To offer employees quality and flexible choices with benefits packages, it is essential that plan sponsors choose a partner that provides unbiased plan comparisons to ensure that the employees best interests are kept in mind while they are shopping,” Grant says. “Offering plans from multiple carriers creates a competitive marketplace, which ultimately leads to cost savings for employees. Additionally, it is key to choose a partner that continues to shop the market for each individual as price and plan offerings will continue to fluctuate.”
3. Retirees need a trusted resource to guide their retirement health care decisions.
Retirees are not confident in navigating the complexities of Medicare, or health insurance plans in general, according to SelectQuote research. Providing support from an in-house human resources or benefits manager can be costly for employers. By partnering with a private exchange, many times the exchange offers resources to assist retirees in their decision-making processes.
“Private exchanges help employers streamline administrative costs, create a turnkey solution for the organization and improve the company’s bottom line, while still giving retirees the care and coverage that they deserve and need,” says Grant.
“Providing communication that best embraces the company or organization’s culture will allow plan sponsors to clearly direct employees to a knowledgeable resource and ensure an optimized engagement rate,” he adds.
Grant cites the example of SelectQuote’s approach via a variety of communication platforms catering to a range of audiences through both print and online formats including brochures, direct mail, customized web platforms and webinars, as well as offering access to well-trained, knowledgeable agents available to provide one-on-one support over the phone.
Grant emphasizes that providing employees and retirees with unbiased advice to help them make informed decisions to fit their family needs and budgets is very important.
Research for the PEEC survey was conducted in December 2013, based on 723 employers from 34 different industries across the United States. More information about that survey can be found here.