When it comes to making an important decision, a significant investment or even beginning a business relationship, my mother has always given me the same advice: “There’s a lid for every pot.” She was right; her advice directed me to find the product or service that was the best fit for my unique needs. The same stands true for private exchanges. Even in this new market, private marketplaces vary widely. Before choosing just any lid to cover your business’s pot, make sure you know the types of private exchange models. Knowing your options will help you narrow down the private exchange model that suits your business needs – and the needs of your clients – best.
Single Carrier Exchange
The single-carrier private exchange model offers only one carrier’s plans. Now, there may be a variety of plans offered by that carrier, but the group and their employees will only be able to choose products from that one insurance carrier.
If you have a strong, preferred carrier relationship, this might be a great model for you. However, if you'd rather offer a wide selection of plans to your groups or want more flexibility, you might want to keep shopping.
Multi-Carrier Exchange
The multi-carrier model offers your groups and their employees a range of carriers and their plans. The number of carriers and plans will vary by exchange so if this is the model you’re considering, be sure to ask what carriers are participating – and how many plans are offered – to ensure you have the right mix of products (and carriers) to suit your needs. In this model, you might see a wider selection of ancillary products as well which can be beneficial to you as an added revenue stream. It can also provide the group's employees more options for their benefit spend.
Hybrid Model Exchange
In a hybrid model exchange, brokers will have more flexibility to customize the system to their needs. The main differentiator is that hybrid exchanges will allow you to add your own plans. This is a great option for brokers and employer groups who do not want to be limited to a carrier (like in the single carrier exchange model) or to the plans available (in the multi-carrier model).
Typically, you’ll see this exchange model offering standard plans similar to the multi-carrier exchange model but will also allow custom or additional plans to be added at the broker's or group’s discretion. If you prefer having more product and carrier options, as well as flexibility to serve your clients, this is probably the best model for you.
Individual Exchange
The individual private marketplace serves the non-group market. Simply put it’s an online e-commerce platform (think Amazon.com or EHealthInsurance) that allows individuals to shop for a variety of health and ancillary plans for their own needs as well as those of their family. Some individual exchanges allow brokers to enroll members and pay a commission for this assistance, while others don’t. If you’re a broker serving an individual client base, be sure to explore systems that are broker friendly.
Once you've determined which private sector exchange model is right for you, there are some other factors to consider like enrollment support tools, defend contribution functionality and so on. If you’re ready to take the next step in your selection process, you should identify the top features to look for in a private exchange.
Finding the right exchange model is important to your business and to creating added value for your client base. There’s a variety of privately-run exchanges out there so do your research and make sure you find the right lid to go with your pot.
Any questions about your current Solstice products? Login to your portal on https://www.solsticemarketplace.com/
Want to start selling Solstice? Give us a call at 877-760-2247 or email us at sales@solsticebenefits.com