Private Exchange vs. Public Exchange: What is the difference?

What do I need to know about the Private Exchange?
The private exchange is an online resource set up by brokers, insurance carriers, or benefit consultants for individuals and/or employees. It’s a tool for individuals to shop and enroll in a plan, potentially qualify for discounts, visit a health insurance comparison, and submit an application.

In the past it was considered uncommon for large groups to take part in the private exchange. However, due to the health care reform, we’re finding larger groups have taken an interest in the private exchange; under this exchange you’re not subject to ACA rules, regulations, and penalties.

What do I need to know about the Public Exchange?
A public exchange is typically set up by the state or federal government and allows an employee or individual to go online and potentially qualify for a government subsidy which allows them to receive a discount off the cost of their insurance. They can then proceed to buy health insurance through a particular carrier that’s available in the area. At this time, private exchanges are only offered to small businesses and large employers. As of yet, we don’t have private exchanges for individuals within most states.

What is the best choice for my business, public or private exchange?
This works on a case by case basis. Typically public exchanges are–at this time–better for individuals or families. The private exchange is more applicable for mid to large size businesses. Within this past year there has been an emergence of private exchanges for even smaller business owners, with operations down to 10 employees. This depends on what the costs are, what plans are available, and what best suits the employers needs.

As your ultimate business insurance resource, we’re here to help you design your next benefit package to help you retain quality employees. Set up a one-on-one visit to get a detailed insurance evaluation by giving us a call at 866.405.7226.

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