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Tuesday, January 15, 2013

Walmart Considering Setting Up A Health Insurance Exchange

Health insurance exchanges were created by Obamacare (Affordable Care Act) to provide employees a place to shop for affordable health insurance. With the cost of health insurance a particular concern for small business owners, one company might have the answer. Walmart, the nation's largest retailer, is contemplating starting its own private health insurance exchange to offer affordable health insurance to small business owners.

Walmart's plan is to work with health care providers and insurers to establish lower health insurance costs for small business. Considering Walmart's massive bargaining strength versus the very limited choices small businesses have in health insurance plans for their employees, the plan might be a win-win situation for both Walmart and small business.

The Walmart exchange would most likely work similar to the way in which many Fortune 500 companies operate health exchanges for their employees. Large companies allow health insurance providers to compete for the opportunity to sell their plans to the company employees. The competition keeps the prices down and lowers premium costs for employees. It's good for the providers as well because it gives them access to more customers.

Through a Walmart health insurance exchange, small business would have more leverage to negotiate better rates with health insurance providers. Although the details have not yet been determined, the final plan could prove to have positive and far-reaching benefits to small businesses in every state.

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