Employers are showing growing interest in delivering health benefits by giving workers a fixed amount of money to buy coverage through an online marketplace, according to a report from The Wall Street Journal.
About a million Americans will get employer health coverage through the marketplaces in 2014, and that number will grow to 40 million by 2018, according to estimates from Accenture, a management consulting company.
Companies such as Xerox's benefits consulting firm Buck Consultants and insurance broker Digital Insurance are launching online marketplaces that allow employers to give their workers various options to choose from, according to the report. These private employer exchanges are different from the marketplaces for individuals and small businesses opening under the Patient Protection and Affordable Care Act.
Sears Holdings Corp. and Darden Restaurants have already adopted this approach to benefits, and companies of all sizes are showing interest, according to the report. Providing a fixed sum for employees to purchase coverage through a private exchange could save employers money.
Some health policy experts have said the approach could prove problematic for workers if the fixed-sum amounts don't keep up with the cost of health insurance premiums. However, marketplace operators say the employers have been providing annual fixed sum increases that keep pace with premium growth, according to the report.
The average sum increase between 2012 and 2013 was about 5 percent, according to Bloom Health Corp., a company that specializes in defined contribution health benefits. Annual premiums for employer-sponsored health insurance increased by 4 percent for family coverage and 5 percent for single coverage in 2013, according to a Kaiser Family Foundation survey.
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