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The Landscape of Small-Business Health Insurance

November 1, 2013 by admin

Five years ago, a start-up called Liazon began offering businesses a new way to provide health insurance to employees. On Liazon’s Bright Choices, an online marketplace, a company can specify how much money it wants to spend on each employee’s benefits, and employees can use that contribution to buy the plan of their choice.

Liazon was among the first companies to establish a private health insurance exchange, where the benefit provided by the employer is a defined contribution rather than a defined benefit (competing private exchange operators include Aon Hewitt andTowers Watson). “A company can make a budget, and decide exactly how much money they want to allocate to benefits,” said Alan Cohen, who founded Liazon along with Ashok Subramanian and Tim Godzich. “It has nothing to do with what some insurance company happens to say in a given year.”

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