Difference Between Public and Private Benefits Exchanges

The Difference Between Public and Private Benefits Exchanges

When considering health care options for your company’s employees, the difference between a public and private benefits exchange can be unclear. It’s important to remember that the two are very different and that, generally, private benefits exchanges offer more choices for employers. In order to make the best possible decision for your company, consider the differences between these two exchange platforms.

Public Benefits Exchanges

Public exchanges are synonymous with the Affordable Care Act Marketplace in New York. Public exchanges are sponsored by the state or federal government and offer services for individuals and small companies with up to 50 employees. Public exchange coverage programs are paid for by individuals and small companies, although many public exchange plans are also covered by government subsidies.
Generally, the insurance that is provided by public exchanges covers only medical care and prescription drugs. Although this can be helpful for people who don’t currently have insurance, the plans are generally quite skeletal and don’t provide important benefits like dental or vision.

Private Benefits Exchanges

For employers who want more control over their health care choices, private exchanges offer some clear benefits. Private exchanges are run by private companies and, as such, they offer more health care choices for the employees of companies large and small. Unlike public exchanges, private benefits exchanges like the Lawley Marketplace offer a variety of vision, dental and voluntary benefits, along with other ancillary options, such as pet insurance and identity theft monitoring all in one online place, which allows employees to tailor a plan to fit their specific needs.

Additionally, private exchanges also offer the benefit of defined contribution. This means that employers can define their annual contribution budget, which insulates companies against the shifting costs of health care. Defined contribution also offers employees more freedom in how they choose to shop for coverage.

The Case for Private Exchanges

For employers who are concerned about great value and employees who want more health care plan options with added benefits, private exchanges are the way to go. In addition to offering more health plan choices for employers and employees alike, private benefits exchanges also offer increased control over costs and a higher level of care for enrolled individuals.

To learn more about the Lawley Marketplace and find out what our proprietary exchange can do for your business, visit our employee benefits page today.