1. Benefits Exchanges, Explained!
Rajeev Mudumba
VP, Strategic Alliances
hCentive
May 08th, 2014

2. © 2014 by hCentive, Inc. All rights reserved
Our mission:
Who we areOVERVIEW
• First and Largest Developer of State Exchanges
• Integrating and Connecting the Nation’s Largest Health
Plans to all 50 Exchanges/Marketplaces
• Headquartered in Reston, VA with back office in Noida,
India. Regional Offices in NY, CO and PA
• Over 500 employees and growing
2

3. © 2014 by hCentive, Inc. All rights reserved
Insurance Carriers
State Exchanges
Who we serve
3

4. © 2014 by hCentive, Inc. All rights reserved 4
Rajeev Mudumba
Rajeev
Mudumba
is
VP
of
Strategic
Alliances
at
hCen<ve.
In
this
role
he
oversees
strategic
partnerships
&
business
rela<ons
for
hCen<ve.
Prior
to
this,
Rajeev
has
managed
Private
Exchange
Solu<ons
at
hCen<ve.
He
has
over
18
years
of
interna<onal
leadership
experience
in
the
Health
&
Wellness
and
Technology
Consul<ng
industries.
Rajeev
received
his
MBA
from
Old
Dominion
University,
Norfolk,
VA.
He
also
holds
an
MBA
from
Center
for
Management
Research
&
Development,
Pune,
India
and
a
Masters
in
Personnel
Management
from
Pune
University,
India.

5. © 2014 by hCentive, Inc. All rights reserved
• Retail Consumerization – What is the context in the Benefits world?
• What are Private Exchanges? What do they offer? What more will they
offer?
• Why will Private Exchanges complement than compete with – FFM and
state-based exchanges?
• How will the role of Brokers evolve in the post PPACA world?
5

6. © 2014 by hCentive, Inc. All rights reserved
Where did we come from?
An employer-driven payer model….
Where are we headed?
Involve employees and individuals to make their own health
decisions with a defined contribution approach….
“If at first the idea is not absurd, then there is no hope for it.”
― Albert Einstein
6

7. Retail Consumerization – What is the
Context in the Benefits World?
7
© 2014 by hCentive, Inc. All rights reserved

8. © 2014 by hCentive, Inc. All rights reserved
• I haven’t been to my bank unless I am signing a mortgage!
• Most of my travel was booked online, however; I need advise from my
agent on specifics from time to time.
• I haven’t paid a bill in person or via mail
Reason – Technology has streamlined the process, minimized or removed
paperwork totally and saves valuable time and energy along the way.
Online Banking, Travel & Payments are here….to stay!
Why not how we buy our benefits?
Over the last several years…
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9. © 2014 by hCentive, Inc. All rights reserved
Performance
Transparency
Customer
Experience
Price
Quality
What Does Consumerization Mean?
A Health Plan Perspective
9
Consumer Empowerment
Choice and
Flexibility
More
Control
over
Employer
Benefit
$
Lower
Switching
Cost
More
Purchase
Op>ons
Ø Industry
Consolidation
v Need for Scale and Scope
Economies will lead to
Consolidation
Ø Business Model
Innovation
v Partnered ecosystem with
collective accountability will
evolve
Ø Sustainability
Challenge
v Unless clear Competitive
Advantage is created, member
retention is difficult
Market Shifts

10. 10
© 2014, hCentive, Inc. All rights reserved

11. © 2014 by hCentive, Inc. All rights reserved
• Retail centered & consumer focused
• Online and offline storefronts
• Wholesale markets for individual & group plans
• Point of sale innovation, integrated billing & payment services
• Packaged innovative benefit plans combining traditional
insurance models with care solutions
• Retail, Travel & Banking have gone through change, now it’s
health insurance & other benefits!
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12. © 2014 by hCentive, Inc. All rights reserved
• Create competition in the insurance marketplace
• Protect consumers
• Promote good administrative services
• Establish high standards for health plans
• Provide easy to understand information &
engage consumers
• Create seamless integration with Federal & State entities
Quality Care – Efficient Services – Lower Costs
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13. © 2014 by hCentive, Inc. All rights reserved
• Provide consumers product/services know-how in simple
terms for quick assimilation
• Provision clear, comparable information about health
insurance plans
• Provide a simple, easy-to-use “shopping experience” with
robust decision assistor tools to facilitate informed purchase
decisions
• Facilitate ongoing support to build on consumer loyalty
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14. © 2014 by hCentive, Inc. All rights reserved
• Benefits has evolved into an e-commerce product, branding &
appeal will play a crucial part in where the customer goes; cost
& value not withstanding.
• The exchange navigators provide the orientation, education,
and assistance in plan administration
• Designing your exchange to follow the consumer & the cost.
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15. © 2014 by hCentive, Inc. All rights reserved 15
Types
of
Exchange
Play
Exchange
Operated
by
• SBE
at
Eligible
Individuals
&
Family
• SBE
at
Eligible
SHOPS
(<50
and
<100
in
2016)
• Operated
by
Carriers
• Operated
by
emerging
and
established
Intermediaries
• New
business
model
-­‐
free
benefit
system
to
employers
with
broker
commission
as
revenue
• True
compe<<ve
marketplace
likely
operated
by
Benefit
Expert
Intermediaries
• Operated
by
Carriers,
TPA
Individual
Public
Exchange
SHOP
Public
Exchange
Single-­‐Carrier
Private
Exchange
Mul>-­‐Carrier
’No-­‐Choice’
Private
Exchange
Mul>-­‐Carrier
‘Choice’
Private
Exchange
Single-­‐Carrier
Private-­‐Private
Exchange

16. What are Private Exchanges?
What do they offer? What more will they offer?
16
© 2014 by hCentive, Inc. All rights reserved

17. © 2014 by hCentive, Inc. All rights reserved
• Robust consumer-centric, functionality-oriented Web Portal
• Customer Service Support
• Marketing & Outreach Services
• Provider Integration Support
17

18. © 2014 by hCentive, Inc. All rights reserved 18
Move
and
Align
Fully-­‐insured
Employers
(or
migrants
from
Self-­‐Insured)
move
to
Defined
Contribu>on
model
by
alloca>ng
a
fixed
dollars
Stay
and
Involve
Self-­‐insured
employers
custom-­‐
design
defined-­‐benefit
plans
with
emphasis
on
wellness
and
healthy
lifestyle
Stay
and
Shop
Fully-­‐insured
employers
nego>ate
and
shop
to
get
the
best
rate
defined-­‐benefit
plans
Dump
and
Exit
Employers
pay
free-­‐rider
penalty
and
exit
from
offering
benefits
to
employees
Employer
Benefit
Strategies
Large
Group
Small
Group
High
Income
Small
Group
Low
Income
Large
Group
Low
Income,
Re>rees,
High
Income
High
Income
Small
Group
High
Income
Mul>-­‐Carrier
‘Choice’
Private
Exchange
Single-­‐Carrier
Private
Exchange
Single-­‐Carrier
Private-­‐Private
Exchange
Individual
Public
Exchange
Mul>-­‐Carrier
’No-­‐Choice’
Private
Exchange
SHOP
Public
Exchange
Small
Group
is
<
125
Large
Group
is
>
125

19. © 2014 by hCentive, Inc. All rights reserved 19
Fully
Insured
Employer
62.6M
(20%)
Self
Insured
Employer
90.8M
(29%)
Individual
15.6M
(5%)
Medicaid
51M
(16%)
Medicare
40.7M
(13%)
Uninsured
&
Other
Public
(Dual
etc.)
53.2M
(17%)
Health
Plan
PE
Carrier
Enrollment
/
PE
Health
Plan
PE
State
Medicaid
CMS
Part
A/B
–
28
M
Health
Plan
Broker
Broker
Broker
Medicaid
Health
Plan
Health
Plans
–
Part
C
–
12
M
Part
D
Public
Exchange
Benefit
Consultant
Exchange
TPA
Public
Exchange
Public
Exchange
to
Medicaid
Broker
Consor<um
E-­‐Broker
Re<ree
Exchange
PEO
E-­‐Broker
Public
Exchange
E-­‐Broker
U.S.
Popula>on
of
about
313.9M
Consumer
Engagement
Avenues
2011-­‐12
distribu<on
-­‐
h`p://kff.org/other/state-­‐indicator/total-­‐popula<on/

20. © 2014 by hCentive, Inc. All rights reserved
• Integration of health, payroll, workforce productivity & wellness solutions
• Integration of tax-advantaged benefits (HRAs, HSAs, IRAs)
• Partner with third party vendors to develop add-on insurance products
to attract employee buy in
After that….
• Follow the cost
• Find triggers and send alerts to integrated products/services
• Enable employee health & productivity management
• Facilitate & Show Cost Savings
20

21. Why will Private Exchanges complement than
compete with – FFM and state-based
exchanges?
21
© 2014 by hCentive, Inc. All rights reserved

22. © 2014 by hCentive, Inc. All rights reserved
• Federal Mandate: Individual and SHOP (<50 Employees)
• State Mandate: Specific to states
• Centered around Essential Health Benefits
• Compliance heavy: for payers and employers
• Large Employer: Availability in 2017
• hCentive has built the following State Exchanges: NY, CO, KY
22

23. © 2014 by hCentive, Inc. All rights reserved
• Some compliance expected
• Less rigid, offer benefits more than just health
• Flexible and can be customized to address the needs of any employer
group
• Richer benefits offered at competitive prices
• Choice & Consumer Experience are a priority
• Are an extension to what Public Exchanges have to offer…
• Can interact with Public Exchanges and bring the best of both
worlds to consumers….
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24. © 2014 by hCentive, Inc. All rights reserved
• Private exchanges do not replace the role of benefit consultants,
agents, brokers or administrators.
• They serve as a new avenue to service
clients.
• Sales through exchanges are an added
revenue stream.
• Health Plans continue to move out of their comfort zones to
package and integrate their products with complementary ancillary
products/services to engage consumers better and keep them.
• Innovation in exchange marketplaces in terms of new offerings as
well as new ways to package and sell products ensures the health
of a growing new market.
24

25. © 2014 by hCentive, Inc. All rights reserved
• Private Exchanges drive an advantage by integrating tightly
with federal & state exchanges to ensure consumers have the
advantage of reviewing their federal subsidy eligibility on the
public exchange and make purchases within the private
exchange.
• Public Exchanges are able to extend their presence into new
marketplaces while private exchanges are able to provide the
best of both worlds to consumers.
25

26. © 2014 by hCentive, Inc. All rights reserved
• Private Exchanges enable Brokers, Employers and Members
to interact in more meaningful and beneficial ways with the
end consumers.
• Private Exchanges offer robust financial modeling & decision
making tools to support the online shopping experience.
26

27. How will the role of Brokers evolve in the post
PPACA world?
27
© 2013 by hCentive, Inc. All rights reserved

28. © 2014 by hCentive, Inc. All rights reserved
§ Be
open
to
adapt,
move
from
being
a
sales
agent
to
a
consultant,
an
educator
§ Tap
into
Individual
Markets
through
Small
Businesses
not
offering
health
insurance,
as
you
know
insurance
is
mandatory.
§ Become
a
cer<fied
producer
with
your
State
Exchange.
§ Partner
with
a
defined
contribu<on
provider
to
provide
plans
to
small
businesses
that
cannot
afford
or
meet
minimum
par<cipa<on
requirements
to
offer
group
plans.
§ Incorporate
a
Private
Exchange
solu<on!
Offer
products
beyond
health.
§ Become
an
Obamacare
expert.
Ninety-­‐four
percent
of
small
businesses
believe
the
need
for
an
outside
advisor
will
increase
or
stay
the
same
in
the
next
two
years.
According
to
the
U.S.
Census
Bureau,
98
percent
of
businesses
in
the
U.S.
have
fewer
than
100
employees,
accoun>ng
for
approximately
35
percent
of
the
U.S.
workforce
(40
million
workers).
Yet
only
half
of
these
companies
use
an
advisor
for
business
or
personal
needs
regardless
of
whether
they
offer
benefits
to
employees.
-­‐
LIMRA,
Worldwide
Research
&
Consul<ng
Org.
© 2014 hCentive, Inc. All Rights Reserved.
28

29. © 2014 by hCentive, Inc. All rights reserved
WebInsure Benefits Exchange
Employees
Shopping Enrollment Administration
Integrated Shopping
HRA/HIA
Consolidated Enrollment SSO/API Integration with
Administrators
Medical Dental Vision Life Accident STD/LTD
Carrier Dispatching
Life Status Changes
COBRA
COBRA
Commuter
Transit
401 KFSA
Integrated Experience
Payroll IntegrationRenewals
Payroll
Consolidated Billing
An integrated benefits management suite that assists employers in the design, purchase
and administration of employee benefits or contribution while bringing the cost advantages
of a competitive marketplace and lowering the administrative costs.
Exchange
Operations
GRAPHIC REPRESENTATION
WebInsure Benefits Exchange
Employer
29

30. © 2014 by hCentive, Inc. All rights reserved
© 2012 hCentive, Inc. All Rights Reserved.
§ Lower
total
cost
of
client
ownership
through
outsourcing
§ Complete
payroll
reconcilia<on
process
§ State-­‐of-­‐the-­‐art
support
center
with
consistent,
consistent
messaging
to
par<cipants
§ Customized
communica<ons
and
fulfillment
services;
variety
of
methods
to
provide
consistent,
focused
message
§ One-­‐stop-­‐shop
for
client
benefits
administra<ve
needs
§ Breadth
of
product
line
made
available
§ Parameter-­‐driven,
flexible
configura<on
-­‐
permihng
complex
case
set
up
§ Automated
electronic
verifica<on
and
reconcilia<on
of
eligibility
feeds
© 2013 hCentive, Inc. All Rights Reserved.
30

31. © 2014 by hCentive, Inc. All rights reserved
Contact:
Rajeev Mudumba | VP
Strategic Alliances
Direct 732.309.2228
Rajeev.Mudumba@hcentive.com
Questions?
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