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Employer Health Exchanges Akin To ObamaCare Approach See Lower Costs
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Employer Health Exchanges Akin To ObamaCare Approach See Lower Costs

Mar 6 2014, 12:00am CST | by

Pioneering companies that turned to a new concept of giving their workers money to buy health benefits via private online marketplaces known as exchanges are seeing lower health care costs. Aon...

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25 weeks ago

Employer Health Exchanges Akin To ObamaCare Approach See Lower Costs

Mar 6 2014, 12:00am CST | by

Pioneering companies that turned to a new concept of giving their workers money to buy health benefits via private online marketplaces known as exchanges are seeing lower health care costs.

Aon Hewitt, the large employee benefits consultancy, which last year launched its Aon Hewitt Corporate Health Exchange, said the average cost increase in “fully insured” premiums from three companies was 5.1 percent. The three pioneers were Aon (AON), Sears Holdings (SHLD) and Darden Restaurants (DRI).

By comparison, average cost increases for large U.S. employers are projected to be between 6 and 7 percent in 2014, according to Aon Hewitt’s annual cost trend data report.  The lower trend in the exchanges is significant, benefits analysts say, because the rate increase in the exchanges also included reinsurance fees levied on group plans under the Affordable Care Act.

“One of the primary goals of our private exchanges is to bring down the rate of increase in overall health care cost to something that looks more like general inflation,” said Ken Sperling, Aon’s Hewitt’s national exchange leader.

More and more benefits firms like Aon Hewitt rival, Mercer, and insurance companies like Aetna (AET), Cigna (CI), Humana (HUM) UnitedHealth Group (UNH) are developing their own private exchanges.

The exchanges work like those that are operational by states or the federal government under the Affordable Care Act in that they offer consumers more choices plus people who buy coverage are empowered to make choices for their individual needs, benefits consultants say.

Under the health law, millions of Americans are eligible for federal subsidies of about $5,000 to help them buy coverage from health insurance companies that sell individual and small group policies. That subsidized coverage is offered on the government exchanges.

Under the private exchange approach, employers decide on a subsidy or credit that each worker will get to purchase coverage. Then, the employees take to the exchange to select their coverage. The subsidy will vary from employer to employer.

Aon Hewitt has said its exchange turns “selecting health benefits into a retail shopping experience” akin to Amazon.com (AMZN) or Orbitz (OWW).

The Aon Hewit Exchange has grown to include more than 600,000 employees and their family members.

Though it’s still early in the development of private exchanges, consultants are optimistic.

“Our private exchange allows companies to maintain this benefit without having to erode its value or increase what individuals have to pay for it, which has been the pattern for the last decade,” Sperling said. “The second-year premiums in our exchange show early but promising signs that this downward shift is indeed occurring as the exchange helps aligns the interest of employees, employers and insurance companies.”

Source: Forbes Business

 
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Khazanah throws MAS RM6b lifeline

Aug 29 2014 5:01pm CDT | Source: Business Times Singapore

August 30, 2014 1:15 AMKHAZANAH Nasional will inject RM6 billion (SS$2.4 billion) over three years to resuscitate loss-making Malaysia Airlines (MAS) under a recovery plan that includes even an Act of Parliament. Other key moves are migrating its operations, assets and liabilities to a new comp ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 
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2 days ago

MAS posts loss of RM307m for Q2

Aug 28 2014 5:00pm CDT | Source: Business Times Singapore

August 29, 2014 1:13 AMMALAYSIA Airlines (MAS) registered a loss of RM307 million (S$122 million) for the second quarter to end-June, but warned of worse to come in the second half when the "full financial impact of the double tragedies of MH370 and MH17 ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 

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