Are Private Exchanges Good or Bad for Health Insurer Profits?

An article that appeared in today’s AISHealth is saying that health insurers could see their profit margins more than double if their large employer clients transition from a self-insured model to full risk via private insurance exchanges.

The article, which was reprinted from INSIDE HEALTH INSURANCE EXCHANGES, says that the Sept. 17, announcement that Walgreen Co. would move its 160,000 self-insured employees to Aon Hewitt’s multicarrier insurance exchange has gotten the buzz started. Continue reading

PA Blues Plan Offers Consumers Choice Of ‘Health-Care Tiers’

An article in today’s Kaiser Health News produced in association with the Philadelphia Inquirer describe how two new HMO plans introduced last week on the federal insurance exchange by Independence Blue Cross (IBC) are offering Philadelphia-area consumers a road map to cut out-of-pocket health-care costs.

The article notes that consumers who sign up for Blue Cross’ HMO Proactive plans will need to choose hospitals, primary-care physicians, and specialists in the least expensive of IBC’s three price tiers of health-care providers.

IBC officials emphasized that tier one, the cheapest, is not a limited or narrow network because customers have access to the entire network; they just have to pay more if they choose a provider – a doctor or a hospital – in tiers two or three.

The article notes that it is far too soon to say how IBC’s tiered network will affect the Philadelphia market because it is uncertain how many people will choose such plans.

What do you think? Join the discussion below.

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Why Payers Like Defined Contribution Programs

Low administrative costs and the capability to compete with public health insurance exchanges are driving factors. So is the promise of access to big data, which can give payers a strategic edge.

For employers, defined contribution plans take the guesswork out of budgeting for healthcare costs from year-to-year. An employer puts a cap on how much to spend on employee healthcare benefits. Each employee receives a set amount of money to spend on the exchange to purchase the health benefits that meet his or her needs.

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Southland Benefit Solutions, LLC, Announces Formation of a New Company to Focus on Defined Contribution Employee Benefits Training for Agents and Brokers

Southland Benefit Solutions, LLC, (Southland) today announced that it has formed, Health Partners America, LLC, (HPA) a health insurance training and services company that offers its clients long-term solutions in a rapidly changing healthcare benefits environment. Based in Tuscaloosa, with a sales office in Birmingham, AL, HPA will operate as a subsidiary of Southland. Formerly known as Innovative Benefit Consulting, HPA has more than forty years experience in the insurance and financial services industry.

In announcing the addition of HPA to the Southland family of companies, Southland President, James Leitner said that acquiring HPA was part of a strategy to better position Southland to engage in trends currently emerging in the employee benefits industry. He noted that the purchase of HPA and its national distribution channels for delivering training programs and business services to health insurance brokers and agents will better prepare Southland to provide products and services in the evolving healthcare benefits marketplace.

Leitner pointed out that one emerging trend is something called a defined contribution health plan. He said that a defined contribution health plan is an alternative to traditional group health plans and that they are rapidly growing in popularity. Rather than paying a portion, or all of a premium, under a defined contribution health plan, an employer sets aside a fixed dollar amount each month for employees to use to pay for individual health insurance or other medical costs such as doctor visits and prescription drugs. This allows even the smallest of businesses to offer their employees health-related benefits, but it requires that insurance brokers and agents follow defined rules and guidelines to maximize the benefits to the employer and the employees.

“Health Partners America has developed one of the best defined contribution health plan training systems for agents and brokers that we have seen and they are quickly achieving a national reputation for their defined contribution health plan expertise,” said Leitner.

Josh Hilgers, president of HPA said, “The HPA defined contribution health plan training program is designed to give brokers and agents the knowledge and tools they need to help companies of all sizes maximize their health, life and other insurance benefits investment without sacrificing quality.”

About Southland Benefit Solutions:
Southland Benefit Solutions, LLC, (SBS) an employee benefits administrator began offering benefit solutions in 1983. It administers self-insured benefit programs for the Alabama Public Education Employees’ Health Insurance Plan and processes tens of thousands of claims per month with an accuracy rate of better than 99%.


Aetna Launches New Sales, Enrollment and Billing Platform with Benefitfocus Technology

Charleston, S.C. – September 27, 2011 – Benefitfocus today announced that Aetna has selected theBENEFITFOCUS® Platform to integrate online sales, enrollment and benefits management for Aetna customers. By providing Benefitfocus technology across all market segments and lines of business, Aetna delivers a consistent, unified experience to its brokers, plan sponsors and members, who will be able to manage all of their Aetna benefits in one place.

“Aetna is dedicated to helping lower the overall cost of health care by developing innovative online capabilities that make the health care system work more effectively,” said Frank McCauley, Senior Vice President and Head of Aetna’s Local Employers and Consumers business. “We are pleased to work with Benefitfocus – a leader in providing technology that works for individual consumers, small employers and large complex employers – to help achieve these objectives.”

Once the end-to-end solution is completed, Aetna’s individual and employer customers of all sizes will be able to use the Platform to:

  • Shop for benefits and evaluate options with advanced plan comparison tools;
  • Learn with integrated video and decision support tools;
  • Manage eligibility and enrollment for all types of benefits;
  • View and pay invoices, making real-time adjustments as needed; and
  • Communicate with live chat, personalized messages and the latest social media tools.

Aetna’s Employers
Prospective employers will be able to shop online, complete applications, and review and accept quotes. Once they become Aetna customers, benefit administrators can manage enrollment and billing activities year round. When it is time for Open Enrollment, they will be able to leverage industry-leading technology for employee self-service, as well as a suite of sophisticated management tools that includes benefit mapping, work flow and reporting.

Aetna’s Consumers
Consumers will be able to shop and apply for health and voluntary benefits online, while comparing all Aetna products and rates. Once approved, individuals can accept coverage and pay online. Consumers will also be able to manage their benefits on an ongoing basis, make recurring payments and manage health care finances.

Aetna’s Broker Community
Brokers will be able to manage prospects, provide quotes and complete the sales process for consumers, small employers and large employers. After the sale, brokers will be able to use the technology to analyze their client base, provide ongoing support and manage the renewal process. Having all of this information in one place will help brokers provide better service to their clients.

“Today’s health care consumers want to shop, apply and pay online for their benefits in the same way that they make other purchases,” said Shawn Jenkins, President and CEO of Benefitfocus. “Aetna is making a big leap forward by providing technology that engages consumers and enables them to do all of their benefits shopping on one website. What is even more exciting is that Aetna is extending the capabilities to employers and brokers as well, staying in front of customer expectations while preparing for the many layers of health care reform. We are proud to be selected by Aetna and to partner with them to respond to the new market dynamics.”

Aetna has been a member of the Benefitfocus network of data exchange partners for many years. They have also deployed Benefitfocus software to meet specific market needs. For example, Aetna previously launched the Platform’s electronic enrollment software for its Small Group business and also uses online enrollment and billing capabilities for its dental, supplemental life and disability products. The expanded capabilities across other business areas will be introduced to the market starting in the fall of 2011 and continuing through 2012.

“This is currently being incorporated and built into our Voluntary business, and we feel that the Platform will provide a differentiated sales and service experience for our members, plan sponsors and brokers,” said James Reid, Head of Aetna Voluntary Plans. “We look forward to our continued work with Benefitfocus and leveraging their technology across our entire customer base.”

About Aetna Aetna is one of the nation’s leading diversified health care benefits companies, serving approximately 36.5 million people with information and resources to help them make better informed decisions about their health care. Aetna offers a broad range of traditional, voluntary and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans, and medical management capabilities and health care management services for Medicaid plans. Our customers include employer groups, individuals, college students, part-time and hourly workers, health plans, governmental units, government-sponsored plans, labor groups and expatriates. For more information, see

About Benefitfocus Benefitfocus is the largest health care and voluntary benefits software provider in the U.S. with 14,099,528 consumers, 308,583 employers, 61,022 agents and 3,519 carrier representatives live on the Benefitfocus Platform. Benefitfocus offers a single Web-based platform for benefit shopping, enrollment, management and industry-standard data exchange. Benefitfocus – All Your Benefits. One Place.


Benefitfocus Unveils Open Platform At One Place Event

Charleston, S.C. – May 18, 2011 – Benefitfocus, the industry leader in healthcare and benefits technology, today announced that it has opened the BENEFITFOCUS® Platform to select third party developers. Benefitfocus announced the availability of the Benefitfocus API, ad hoc reporting and third party apps at this morning’s keynote address at One Place, the company’s premier event for its employer clients, insurance carrier clients and technology partners.

The keynote address was delivered by Benefitfocus President and CEO Shawn Jenkins, who described the company’s evolving strategy: from self-service, to managing all benefits in one place, to the current open Platform. The keynote featured a live demonstration of the Maryland Health Care Commission’s newVIRTUAL COMPARE plan comparison portal, as well as iPad and Android demonstrations of new mobile shopping and enrollment tools. More than 800 attendees gathered at the historic Charleston Music Hall to hear Jenkins and guest speakers from Allstate, Blue Cross and Blue Shield of Kansas City, BlueCross BlueShield of South Carolina, CareFirst BlueCross BlueShield, EMC, Microsoft and PayChoice.

“Companies that develop a core platform with a cloud-based infrastructure and then provide development tools for others to extend it are the companies that are seeing hyper growth,” said Jenkins. “That statement has really come to define our open Platform strategy. Benefitfocus is the industry leader in benefits shopping, enrollment, management and data exchange. By investing in the extensibility of our technology, we can provide our customers access to the best voluntary benefits, wellness tools and financial planning resources, to name just a few.”

Today’s announcement focused on three key examples of the open Platform: the Benefitfocus API, ad hoc reporting and Benefitfocus Apps. The Benefitfocus API allows others to plug in to Benefitfocus’ industry leading technology. The API is in use by some of the benefits industry’s largest companies, including Aetna and NASCO.

With ad hoc reporting, HR Administrators can now create their own custom reports, modify pre-built reports, and schedule and email reports to colleagues. Ad hoc reporting will be available to all Benefitfocus employer customers later this year.

Today’s keynote marked the official launch of several Benefitfocus Apps. “The availability of apps on the Platform extends the value of Benefitfocus technology for employers and consumers alike,” said Don Taylor, Chief Technology Officer for Benefitfocus. “It is exciting to see new types of apps available. Apps allow third parties to leverage their existing technology investments and tightly integrate their applications with our Platform.”

Examples of third party apps currently available on the Benefitfocus Platform include:

  • Allstate Benefits App: Offers a comprehensive portfolio of Allstate benefits through the Benefitfocus Platform as part of the core enrollment process, providing employees with an online marketplace for voluntary benefits. Created by Allstate.
  • Data Analytics App: Consolidates claims analysis, data warehousing, financial analysis, trending and forecasting to deliver a complete package of health plan analysis tools. Created by Benefit Informatics, a Benefitfocus company.
  • Discovery Benefits App: Integrates enrollment for flexible spending accounts, health reimbursement accounts, health savings accounts, COBRA and transportation benefits. Created by Discovery Benefits.
  • Financial Wellness App: Provides a financial planning content library with free employee tools like budget calculators, spending guidelines and videos. Created by Consolidated Credit Counseling Services.
  • Just InTime Wellness App: Delivers personalized, timely messages to employees about their health. Health alerts are based on each employee’s unique health profile and focus on the relevant issues pertaining to each person. Created by SCIOinspire.
  • PayChoice App: Simplifies benefits and payroll administration by integrating the Benefitfocus Platform with PayChoice’s SaaS payroll processing technology. Eliminates data entry in multiple systems and ensures that correct withholdings and deductions are processed for employees. Created by PayChoice.

With Benefitfocus Apps, participating companies combine their products, software, content and tools with the Benefitfocus Platform. “Benefitfocus is the platform standard for benefits shopping, enrollment and administration,” explained Robert Digby, CEO of PayChoice. “Combining our offerings closes the loop between benefits selection and employee paychecks for employers and insurance carriers.”

Blue Cross and Blue Shield of Tennessee Joins Forces with HealthCompare to Make Healthcare More Accessible

ORANGE, Calif.–(BUSINESS WIRE)–Blue Cross and Blue Shield of Tennessee, the state’s oldest and largest not-for-profit health plan with nearly three million members, announced today that it is partnering with HealthCompare to help individuals and families easily research, compare, buy and enroll in the right health insurance plan at the right price. HealthCompare ( is one of the nation’s leaders in offering individuals shopping for health insurance free, accurate and customized health insurance quotes and personal assistance.

“PersonalBlue is aimed at helping consumers navigate the complex and often confusing world of individual health insurance,” said Charlie Goe, business segment director of individual sales. “The beauty of this product is that it breaks down the health insurance shopping process into smaller, less intimidating chunks. HealthCompare will greatly support this product by helping Tennesseans understand their options and select the right plan for themselves and their families.”

Using proprietary technology, HealthCompare presents easy-to-understand information on HMO, PPO and indemnity health plans so people have the tools and materials they need to make the most informed decisions. In Tennessee, users can now simply enter their information and receive instant quotes online based on Blue Cross and Blue Shield’s local offerings and provider network.

HealthCompare, a Word & Brown Company, was developed in late 2009 to help individuals and families easily research, compare, buy and enroll in the right health insurance plan at the right price online. Working closely with brokers and national insurance companies, HealthCompare offers individuals free, accurate and customized health insurance quotes and personal assistance in finding and selecting the right program to fit their needs.

Headquartered in Orange, California, The Word & Brown Companies is the nation’s recognized leader in developing and offering innovative technology, health benefit plan models, and sophisticated employee benefits services to companies of all sizes. In addition to HealthCompare, The Word & Brown Companies include CHOICE Administrators®, the nation’s only private health insurance exchange administering healthcare programs for more than 10,000 employers covering as many as 150,000 members; CONEXIS, the nation’s oldest and most trusted employee benefits administrator, providing COBRA/HIPAA, FSA, commuter benefits and direct bill services to thousands of clients nationwide; and Quotit® Corporation, the leading Internet application service provider for the health insurance and employee benefits industry. For more information, visit