Walgreen Employees Shifted to Private Healthcare Exchanges

In a sign of the times, Walgreen has become the largest employer to move from employer supplied health care to a cash benefit employee exchange program. The move by Walgreen is expected to affect 120,000 employees and should be implemented in 2014.

Although Walgreen is the largest to make the shift to insurance exchanges, they are not alone. Walgreen joins other notable companies such as IBM and Time Warner. The speculation from spectators is that the move from Walgreen will entice their competitors and others to seriously consider such a move also.

Aon Hewitt, the current administrator of the healthcare exchange plans, has seen enrollment in private exchanges increase substantially over the past few years. The enrollment for 2012 was near 100,000. The enrollment for 2014 is expected to be over 600,000 and by the year 2017, Hewitt says that a full 20% of all employees could be in healthcare exchanges and over 30% of the nations largest businesses will have moved in that direction.

The current coverage that is provided to Walgreen employees is near the middle of what will be offered through the healthcare exchange insurance plans. Almost half of current exchange members chose a cheaper plan than what they previously had. A quarter of the exchange members chose a more expensive plan. The rest remained roughly the same. Walgreen does not see making any other large benefit moves in the near future.

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