Pros and Cons of Private Health Exchanges
Dental practices could utilize private health exchanges to provide insurance for their employees (Merhar 2016). Employers would determine the type of policies and “specified contribution levels” for employees, who would search for their own policies in the exchange online (Uzialko 2016). Private health exchanges may benefit employers and employees, but they contain flaws.
Employers and employees can benefit from the private exchanges. Employees could choose from many health plans that suit their needs (Rogers 2017). To aid employees comparing different plans, many private exchanges organize plans according to different categories such as “bronze” (Konrad 2016). Although the policies in each category offer “‘the same covered services, deductibles and co-insurance,’” “premiums and provider networks do differ among plans” (Konrad 2016). Additionally, private exchanges can offer “more competitively priced or higher quality [options], come with success agents who can advise [employers], and often let [small business’] employees spend pre-tax dollars on health insurance to save money” (Hecht 2016). Albeit, according to Bob Herman, who “covers the health insurance industry and other healthcare news,” “many studies and surveys have shown people care more about their doctors and provider networks than the actual number of coverage choices they have” (Herman 2015). Even so, having more choices could help other employees find a plan that offers the best coverage and ideal networks. Private exchanges benefit employers because, according to The Kaiser Foundation’s 2014 report, “‘Because the employer defines up front the amount paid to the employee, employers have greater control over how much they spend on health benefits’” (Uzialko 2016).
However, private exchanges contain financial and logistic flaws. For instance, private exchanges contain many high-deductible plans with low premiums, causing employees to enroll into plans “with high out-of-pocket costs” (Konrad 2016). Though, some employees may not mind high deductibles, “if [they’re] healthy and don’t use a lot of health care services” (Konrad 2016). Employers would not save money on health insurance by using the private exchange because “[as] health insurance costs rise, deductibles increase and medical care continues to skyrocket, the only way employers can save money or maintain their current level of expenditures on health care is to pass the cost increases on to their employees” (Smedsrud 2016, 2). By using a private exchange, “Wellness and population management benefits are also lost… It is more difficult to promote wellness, engage employees and track an employer’s own population health in a private exchange” (Smedsrud 2016, 2). Additionally, human resources and employees must “work with a variety of customer service representatives” instead of one person from the insurance company (Smedsrud 2016, 2). Furthermore, human resources have to spend more of their work time on learning about many more health insurance policies in the exchange and “the nuances of enrollment” (Smedsrud 2016, 2).
Dental practices, like other employers, could utilize private health exchanges, allowing their employees to choose from a variety of policies. While private health exchanges do have hidden financial and logistics cons, they may help clinics’ employees enroll into health insurance policies.