Mortgage Bankers Association to Open Healthcare Exchange for Members
The trade group is offering member companies access to a healthcare exchange, with the goal of assisting them in reining in the cost of providing benefits.
If you’re looking to build a healthcare exchange for your association, you might do well to keep an eye on what the Mortgage Bankers Association is doing.
On Tuesday, MBA announced it was launching MBA Health Link, a new private exchange with the goal of improving healthcare offerings for its member companies. The group will work closely with insurance broker Arthur J. Gallagher & Co. The association says the goal of creating MBA Health Link is to help relieve some of employers’ common concerns, such as cost control, predictability, and both administrative and compliance responsibilities.
“Industry data show that our members face major challenges in getting control over certain costs, particularly in the healthcare and benefits arena,” Pete Mills, MBA’s senior vice president of residential policy and member engagement, said in a news release. “Where MBA Health Link stands out as such an attractive option for our members is in its ability to create administrative and financial efficiency while delivering high quality benefits to their employees.”
Along with the private exchange setup, MBA Health Link will rely on a defined contribution approach, rather than the more traditional defined benefit strategy used by most companies. Defined contributions, more commonly used for 401(k) plans, tie a certain level of funding to the healthcare offered, rather than the other way. The approach has been gaining ground; backers say it increases transparency and makes the expenses incurred by the health plans more predictable.
“Employers want to understand and start to predict what their health benefits costs are likely to be,” Hay Group consultant John Hennessy told the Society for Human Resource Management last year. “They are thinking that the plans and approaches available in the past aren’t going to fit in the future.”
In its news release, MBA noted that it chose the approach in part because “it works best in a private exchange environment, where employees have a choice on how to spend their benefits dollars.”
While MBA’s approach is relatively rare in the association space, it’s not unique. Back in July, the DC hospitality group Industree announced it was offering a insurance exchange for restaurants and bars, businesses that often struggle to give healthcare benefits to employees.