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Despite predictions by consultancies of more than 18 million active enrollees in private exchanges by 2018, many large employers are hesitant to make the jump. Here are the five reasons that employers in the Dallas-Fort Worth Business Group on Health, whose 80 members have more than 1.5 million employees nationwide, say are preventing them from changing.

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Fear of the Unknown

This is a fear of the unproven; the unknown is employers don’t know if private exchanges contain long-term cost savings, Marianne Fazen, executive director of the Dallas-Fort Worth Business Group on Health, says. Private exchanges “are too new to demonstrate any real true value.” While year one may see dramatic cost savings, that may be a result of employees buying a bare-bones level plan. Fazen’s members tell her, “There is no proof of long-term cost savings, only promises from those who put the market together.”

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Early in the Process

The private exchanges market “is very immature, not just for just for employers but also providers and insurers.” For example, Fazen says her employer groups tell her hospitals and physician groups have a lot of changes to make to their IT systems to accommodate a private exchange model.

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Competitors

Many of Fazen’s employer groups say they worry employees will leave for competitors who are not on a private exchange, since they feel they may not be getting a good deal or their employer is cutting costs by making the switch.

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Complexity

Employee reaction is one of the “most daunting things,” Fazen says. With a private exchange, employees need help making all these decisions and need to be educated on the changes. While many exchanges have consumer decision support tools, DFWBGH’s members say their employees want someone to help them make the decision. “One company’s HR department said, ‘My employee wants me to make the decision for them,’” Fazen says. “[Employees] are asking the benefit manager, ‘Which plan is right for me?’ They don’t know how to evaluate.”

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Political Instability

Every year — or even every month — something changes, Fazen says. Employers have more uncertainty then anything, so, “wait and see is a safer route,” says Fazen.

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