Since launching its private exchange solution a year ago, the human capital management powerhouse has continued to add clients and plot its future moves, explains Will Giaconia, ADP’s vice president of healthcare strategy. EBA spoke with Giaconia to find out how the marketplace continues to develop.
EBA: It has been a little over a year since launching the ADP exchange. How is it going?
Giaconia: It is going well. We have a different take on these than some of the … first movers and players in the space. What we were looking to do … was to bring that kind of a solution to our broader portfolio of benefits administration and related products and services, all within the human capital market environment that we play in.
From that perspective, it has been really successful. [It is] really helping our clients who are potentially interested in these things now or in the future to know that they have an option with us. … That was what we were looking to accomplish more than anything.
EBA: You said at the time of the launch that you would work with brokers, are you doing so?
Giaconia: A lot of our clients wanted an exchange and wanted to keep their broker, but they didn’t have that option, unless that broker or consultant happened to have an exchange that best fit the client’s needs. Our approach was to be broker/consultant agonistic. From that perspective, it has been really good for our broker/consultant partners in the market, where we serve mutual clients and prospects. We don’t intend to be a threat; we want to work with them of behalf of clients.
When a client comes to us and they want a pre-packaged exchange solution and they’re not interested in staying with their current broker or they are actively looking for a new broker, we can bring strategic partners to the table. But, most of what we have experienced with our clients and our prospects is they have brokers and consultants and advisers that they trust and they want to keep. They like the fact that we will work with their current brokers. The vast majority are staying with their current broker. It’s a very high percentage that want to keep their current broker/ consultant and work with us on the exchange technology side.
EBA: What is the future of the ADP exchange?
Giaconia: Things that won’t change are we will continue to be broker/consultant agnostic, which is very important. The second thing is we will continue to focus on is providing an exchange experience that is fully integrated with the broader human capital experience — client HR, payroll, talent management, and Affordable Care Act compliance. Those two things you can expect to stay the same because they are the backbone of our offering.
Things that will change will evolve with the market: Broader benefits administration and exchange capabilities, augmented with new or different consumerism tools or sets of products and services. For example, an expanded set of voluntary products or offerings. Or maybe an expanded suite of tools related to cost and quality.
Those are the types of things that if the market reaches a tipping point and our clients want to see those things on a pre-packaged basis versus a customized basis that is where you will see us move. But, it will only be when the market dictates it. I think that may be why some of the uptick in the private exchange market may have been a little slower than anyone expected. There was lot of things that happened and offerings that were created to respond to what we thought might be a need, versus what the actual client and market need was. So, we will remain focused on what the market is looking for versus trying to push something on the market.
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