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ADP offers health exchange for full-time and contingent workers

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Human resources and benefits administration technology provider ADP L.L.C. has launched a private exchange that enables employers to assist both full-time employees and those ineligible for employer-sponsored coverage in selecting health plans.

Roseland, New Jersey-based ADP's private exchange, launched Thursday, allows benefits-eligible employees to enroll in health plans within its existing human capital management and benefits administration platform, while also directing those part-time, temporary and contract workers to the public exchange offered through GoHealth L.L.C.

Chicago-based exchange technology provider GoHealth powers a private health insurance exchange that also sells subsidized health insurance plans under the Affordable Care Act, ADP said in a statement Thursday.

“Until now, many employers either did nothing or directed their workers who do not qualify for a group plan straight to public exchanges, where they would enroll in benefits and apply for federal subsidies often without assistance or their employer's knowledge,” ADP said.

But ADP found that most employers are interested in assisting their benefits-ineligible workforce to enroll in health insurance as it will help them stay engaged and productive, Gerry Leonard, ADP's Alpharetta, Georgia-based president of benefit services, said.

“There's a lot of companies who have a fairly large contingent workforce” who are not eligible for benefits through the company but are still obligated to “pick up health insurance,” Mr. Leonard said.

Employers say “if we can easily make the products available for (contingent workers) and let them shop much more seamlessly, then we'd like to do that,” he said.

On the GoHealth platform, employees will be able to apply for federal subsidies and compare health plans and prices.

At the same time, employees eligible for employer-sponsored health insurance are able to shop for benefits offered through the employer's chosen insurance broker and can compare plans for price and coverage using decision support tools through ADP's exchange.

USI Insurance Services Inc. is the first broker to partner with ADP's private exchange, but Mr. Leonard said ADP will partner with any broker or insurer.

Currently, few employers offer employees access to a private health exchange, despite major benefits consultants, such as Towers Watson & Co. and Aon P.L.C., launching their own.

According to the Society of Human Resource Management Inc., only 2% of employers moved to private exchanges in 2015.

But Mr. Leonard expects more employers to shift employees to a private exchange model once the burden of compliance for the next enrollment season passes.

“Once that wave passes, they'll move on to the next big issue, which is the excise tax” — the 40% tax on the portion of health plan premiums that exceeds $10,200 for single coverage and $27,500 for family coverage slated set to take effect in 2018 — he said. “They'll begin to ask for more innovative strategies to address that, and I think exchanges will begin to pick up again.”