‘Exchange’ the way you think about employee benefits
Assuring your financial institution gets the most ROI out of your employee benefits programs can easily become quite an expensive and challenging endeavor. In fact, Gallagher’s own 2015 National Benchmarking Survey found that 62% of employers surveyed placed “controlling benefit costs” in their top three challenges. With rising, unsustainable healthcare costs, employers are looking for innovative ways to continue to offer benefits. The answer comes in the form of the private exchange.
Private exchanges are employer-sponsored online platforms that allow employees to shop for health and welfare benefits. They afford employers the opportunity to offer a broad range of benefits, including medical, ancillary, and voluntary benefits to their employees through an interactive online portal. Private exchanges aim to help employers solve their benefits challenges by locating cost inefficiencies, driving sustained employee engagement, and easing the employer’s administrative burden, and they are accomplishing all of that.
According to recent data reported by Gallagher, private exchanges lower the actuarial value of an employer’s benefits plan by an average of 4.3%. Also, Liazon’s 2015 Employer and Employee Survey reports that:
- 70% of employers say that their exchange has helped control costs,
- 96% of employees preferred to choose their own benefits (with 95% still being satisfied with their selections after a year), and
- 67% of employers say their benefits administration has been streamlined.
A recent Accenture study revealed that an estimated 6 million employees enrolled in their benefits through an employer-sponsored private exchange in 2015. This same report states that the number of employees enrolled in private exchanges is expected to double in 2016 and to reach 40 million enrollees by 2018. These figures demonstrate that private exchanges are due to become increasingly popular with employers and employees in the coming years.
For more information about the positive impact of private exchanges on organizations and their employees, read Gallagher Benefit Services’ report containing data collected on enrollees of their private exchange, Gallagher Marketplace.