Towers Watson expects about 1.2 million employees, retirees, and their eligible family members from over 1,500 employers to choose their health care and other insurance coverage through Towers Watson's exchange solutions in 2015. This is up from over 800,000 individuals at the end of 2014, representing a 50 percent increase in the number of people who could evaluate, select, and enroll in their benefits through Towers Watson's private exchange solutions.
Towers Watson said that its exchange solutions support all workforce populations, including full- and part-time employees, and pre-Medicare and Medicare-eligible retirees.
The company said that total spending on full-time active employee health care by employers participating in its “OneExchange” was projected to grow by just 1.8 percent from 2014 to 2015 – a rate close to the Consumer Price Index (“CPI”) and much lower than historical and projected health benefit cost increases. Because the excise tax under the Patient Protection and Affordable Care Act (“ACA”) – also known as the Cadillac tax – is linked to CPI, keeping health cost increases within its range is crucial for avoiding the excise tax, not only in 2018 but also beyond.
Towers Watson said that among the new employers adopting OneExchange for full-time active employees for 2015 are Envision Healthcare and Time Inc.
Don King, vice president of benefits and compensation at Towers Watson, said, “Towers Watson has developed a program that allows our employees more provider, health plan, and price options than previously available, which is almost unheard of in today's health care marketplace. Expanding insurance carrier options spurs competition, which improves long term cost-mitigation opportunities.”
Towers Watson said that Convergys Corporation was one of the first companies to adopt OneExchange for full-time active employees and is in its second year.
“We're pleased that OneExchange has helped us manage escalating costs associated with health care benefits for our company and our employees,” said Dennis Hicks, the vice president of compensation and benefits for Convergys. “At the same time, we are pleased with how our employees have responded to the change. Post-enrollment data show us that our people chose their insurance options with an eye toward value. In fact, two-thirds of them enrolled in the best-in-market health insurers by price, and over 90 percent felt the information they received from OneExchange helped them make informed choices.”
“Private exchanges represent an opportunity for employers to manage the high cost of delivering health care and other benefits. Our model lets employers leverage plans from several top carriers in each area across the nation and gives employees greatly expanded plan choice – a competitive environment that is difficult for any employer to create on its own,” said Jim Foreman, the managing director of exchange solutions for Towers Watson. “OneExchange is also compelling for employers seeking ways to avoid the ACA's excise tax, which goes into effect in 2018.
“Convergys, Envision Healthcare, and Time Inc. are leading their industries in adopting innovative, new ways of thinking about how to better deliver quality, cost-effective health benefits that are sustainable for the long term,” added Mr. Foreman.
Learn more: www.towerswatson.com.
Victoria Spears
Victoria Prussen Spears is senior vice president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. A graduate of Sarah Lawrence College and Brooklyn Law School, Ms. Spears was an attorney at a leading New York City law firm before joining Meyerowitz Communications. She may be contacted at [email protected].