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Private exchanges are moving aggressively to address the challenges of providing quality healthcare at an affordable price, according to experts.
NATIONAL REPORTS- Private exchanges are moving aggressively to address the challenges of providing quality healthcare at an affordable price, according to experts. The attraction of the private exchange stems from its flexible structure-somewhat different than the heavily regulated state-based exchanges scheduled to go live in 2014.
Public exchanges will be state sanctioned and organized institutions, he said during an online presentation last month, but private exchanges would not necessarily be licensed by the state or sanctioned by the state.
Exchanges will be one of the major drivers of innovation in the marketplace. By 2016, nearly 25% of the U.S. population will receive insurance coverage through exchanges with about 40% of these in private exchanges.
"This is a dynamic time in healthcare," says Steven Auerbach, president of Connextions Inc., a technology and business services provider, which sponsored the online presentation. "When you think about healthcare and the rapid changes that are occurring, you see tremendous opportunity to help consumers get much better, simplified and affordable healthcare."
MILLIONS OF BUYERS ONLINE
Sixty percent of private exchange enrollment will be in Medicare programs, while the remaining individuals will enroll in private exchanges meant for individuals and employers.
The Congressional Budget Office estimates that 12 million consumers will buy health insurance in the exchange market in 2014, rising to 28 million consumers by 2019. PricewaterhouseCoopers estimates that health insurance exchange policies could be worth nearly $60 billion in premium revenue in 2014 and grow to nearly $200 billion in 2019.
More than half of health insurance executives say their companies plan to compete in the individual or small group exchanges and nearly one-third are considering it. Exchanges are not a 2014 issue, as evidenced by the emerging private-market exchanges of today.
"There is a lot of conversation about where the marketplace is going, but we also see people quickly entering the marketplace," says Rob Panepinto, managing director of client practice at Connextions.
With private exchanges:
"There are still a lot of moving parts, and people are seeking answers to questions that there are not answers to yet," Panepinto says. "I do think there is consensus that there is real opportunity here, that healthcare is changing regardless of what the final regulation turns out to be. There is considerable opportunity for new and different entries and products to market in the public and the private side."