Why Small Business Owners are Switching to Private Health Exchanges

Often frustrated with the rising costs and administrative headaches associated with traditional group health insurance plans, today’s small-business owners are seriously considering their options. For many businesses, private health insurance exchanges are an attractive alternative to group plans. However, are private health exchanges a cost-effective choice for small-business owners? How will they impact your administrative workflow? Let’s take a closer look at private health exchanges and the benefits they offer.

Private exchanges allow you to attract (and keep) top talent.

Rising group health insurance costs may have you considering dropping employee benefits. In turn, you’ve probably also been concerned about how a lack of health benefits may impact your employee recruiting and retention. In today’s competitive marketplace, a solid benefits package may be the difference between a superstar candidate joining your team or going to the competition.

Private exchanges offer businesses the best of both worlds: comprehensive health insurance benefits at prices that tend to be much more affordable than group health policies. For companies that want to stay competitive and keep benefits costs down, private exchanges may be the perfect fit.

Private exchanges can be cheaper for employers and employees

In a group health insurance model, the small business employer is responsible for selecting benefits that best meet the needs of all employees, which is a tall order. In trying to pick benefits that work for everyone, the employer is often left with a plan that doesn’t work particularly well for any individual.

In a private exchange model, employers are able to offer a much wider variety of health insurance plans from which employees can choose. That means Dave in accounting can select a plan that will help him manage his diabetes in a cost-effective manner, while account manager, Sue, can opt for a more basic plan with significantly lower costs. Because neither the employer nor the employee is forced to pay for unnecessary benefits, everyone can save money.

Private exchanges can be less hassle and less paperwork

Keeping up with changing health insurance rules and regulations—not to mention reporting and compliance-related tasks—can be time-consuming. If you’re like most small business owners, you may not have those moments to spare. Unlike group health insurance plans that put the administrative and enrollment responsibilities on the employer, private exchanges offer employees a self-service model. The private exchange shoulders much of the administrative burden, leaving you more time to focus on your core business.

Include private exchanges in your insurance research

As a small business owner, you have plenty of tasks to keep busy, including making decisions about your employees’ health insurance. If you’re looking for a way to stay competitive to attract top talent but still keep costs down, private exchanges may be the ideal solution. An attractive alternative to group health insurance plans, private exchanges bring cost-savings to businesses and their employees, and they also reduce administrative hassles.

Author: Lauren Mandel is the Content Marketing Manager at GoHealth. GoHealth powers one of the nation’s leading private health insurance exchanges for individuals and families.