Digital Benefit Advisors said today it has begun enrolling New Jersey businesses in its online private insurance exchange, a system it says will benefit small to midsize employers by enabling companies to provide coverage on fixed budgets with fewer administrative burdens.
Digital Benefit Advisors, a division of Digital Insurance, an Atlanta-based employee benefits only agency, says it is bringing New Jersey companies and employees a consumer-friendly approach to choosing benefits through the technology it has been developing over the past decade.
"The software has caught up to the marketplace enough that you can create online stores and allow people to choose for themselves solutions customized to their needs," Digital Insurance Chief Marketing Officer Mike Sullivan said.
Private exchanges differ from traditional benefits, where employees choose a health insurance carrier and pay a portion of the premium. Private exchanges allow the employer to specify the amount they want to pay toward benefits per employee. Decision making then shifts to the employee, who selects plans and coverage.
"What that means is a broader choice at the individual and family level," Sullivan said. "Instead of employers trying to make a generic choice for 500 or 5,000 employees, this provides a customized approach directed at the individual."
Private exchanges also differ from public exchanges operated by the government, such as those created by the Affordable Care Act, that apply to health insurance only. Private exchanges also include life insurance, disability, dental, vision and other benefits.
Sullivan said the private sector is applying the idea of public insurance exchanges, pushed by government, to a broader scope. Public exchanges are appropriate for employees eligible for government subsidies, Sullivan said, but Digital Insurance otherwise believes people will gravitate toward privately run systems.
"If we can't compete with what is effectively the DMV of health care, then shame on us," Sullivan said, referring to widespread glitches that have overwhelmed healthcare.gov.
"We are going to create a framework that gives employers greater flexibility and choice."
Long-term, the company says employers will benefits from more predictable budgets, less administrative costs, and customer service provided by Digital Insurance's call centers.
Sullivan said New Jersey was an attractive choice because Digital Benefits Advisors has about 500 employer clients in the state, which it serves from a Philadelphia office, and plans to expand presence.
"It's a prelude to an acquisition strategy," he said. "It's a very competitive marketplace."
Sullivan said the company enrolled about 100 small to midsize employers in New Jersey to its private insurance exchange, called Digital Exchange Marketplace. The parent company operates in about 45 states, he said.
For more information, employers can visit digitalbenefitsmarketplace.com.