Over the past few years, there has been some high profile press regarding the transition from traditional employee benefits offerings to private exchanges. Many corporations have made this transition. And there is broad speculation that exchanges will increasingly become a presence in the employee benefits world.
Milliman is in a unique position to assist employers in evaluating if the switch to a private exchange makes sense (a feasibility study) or helping conduct an RFP. Some employers have asked Milliman to assist in evaluating the RFP responses even when we were not conducting the RFP. Milliman is uniquely qualified to assist employers because we do not offer our own exchange solution and we are completely independent. Coupled with our deep actuarial and benefits expertise, we ensure an apples-to-apples comparison and simplify the explanation regarding how the impact of the exchange will affect both the employer and the employees.
Private exchanges are relatively new and their savings promise has not been tested over time. This makes a detailed understanding of the underlying savings estimates necessary in determining what the actual savings may likely be (realistic estimates) versus the higher (and more optimistic) savings sometimes quoted in the sales pitch from private exchange vendors.