Office of Consumer Health Services
OVERVIEW U.C.A 63M-1-2504 The Utah Health Exchange is part of Utah’s overall health system reform effort that is aimed at increasing the number of Utahns with health insurance. It is designed as a market-driven solution to create a competitive environment while providing multiple medical plan options for consumers. The Exchange brings the consumer back into the equation by promoting employee engagement to choose health coverage for themselves and eligible family members. The Utah approach to reform is based on enhancing consumer choice and the ability of the private sector to meet consumer needs. Individuals are able to find coverage by using a “farmers market” approach, which gives consumers three on-line options to shop for and buy a policy. Currently, there are five private online shopping services, five insurers and thousands of agents available through the Exchange. Small businesses are able to leverage group rating rules — just like in the wider traditional market — but with an increased focus on choice and value. The Exchange’s defined contribution model gives employee’s control over health care costs and lets employees choose the policy that works best for them. Three participating carriers currently offer more than 140 plans ranging from high-deductible options to comprehensive coverge.
Small Businesses and Defined Contribution The Exchange’s primary market is small businesses with 2-50 employees. We have found that focusing on small businesses lets us help the greatest number of Utahns with the highest degree of efficiency. This is because approximately 98 percent of the state’s business community is made up of small businesses — and those small businesses employ roughly half of all Utahns. In addition, we have found much success in the small business market, thanks to our innovative “defined contribution market,” which benefits employers and employees alike. The defined contribution model lets employers offer an extensive array of benefits and provider networks, from which employees make selections ranging from very rich plans to high-deductible plans, all with a pre-tax advantage. At the same time, employers pay a flat dollar amount toward employee benefits, helping them remain within a predictable budget. As in the traditional market, groups on the Exchange pool risk for employees in the company, which results in the potential for overall lower rates. When join-
Governor’s Office of Economic Development • 2012 Annual Report • www.business.utah.gov
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