Aon Hewitt Shows Continued Cost Savings for Companies and Individuals Participating in the Aon Active Health Exchange

Third Straight Year of Below-Market Cost Trends; Companies Saved More Than $750 per Employee

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Sep 18, 2014, 09:23 ET

LINCOLNSHIRE, Ill., Sept. 18, 2014 /PRNewswire/ -- Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE: AON), today announced that employers and individuals participating in the Aon Active Health Exchange are seeing notable reductions in health care spend for the third straight year.

More than 600,000 employees and their dependents enrolled in health benefits through the Aon Active Health Exchange for the 2014 calendar year. All of the 18 companies that participated in 2014 are returning to the Aon Active Health Exchange in 2015. Across those companies, rates for medical coverage increased an average of 5.3 percent. This is lower than the industry average and includes costs associated with the Affordable Care Act. According to Aon Hewitt's estimates and several other organizations,¹ average health care cost increases in 2015 for large U.S. employers with self-insured arrangements are projected to be between 6.5² percent to 8.0 percent³ before employers make changes in deductibles and copays. Based on employer and employee feedback, plan designs in the Aon Active Health Exchange for 2015 will once again remain unchanged.

Companies participating in the Aon Active Health Exchange also reduced their overall health care cost for medical coverage by more than $750 per employee compared to their expected 2014 spending. These numbers factored in the savings delivered through the exchange model, the impact of employee choices to buy less rich coverage and the impact of employees who chose to purchase richer—and often more expensive—medical plans. Average health care costs were $8,342 per employee, down from $9,098 per employee. These savings were shared with employees through reduced payroll contributions, as well as through offering a range of more affordable health care coverage options.

"The Aon Active Health Exchange is designed to create a more effective and efficient health care ecosystem by aligning employers, employees, providers and insurance companies," said Ken Sperling, Aon Hewitt's National Health Exchange Strategy Leader. "After three years in operation, we continue to see evidence that our fully insured, multi-carrier model is fostering competition at the consumer level and encouraging individuals to become smarter about their health care choices, which have helped drive down the cost increases that employers and employees have experienced over the last decade."

According to Aon Hewitt's post-enrollment analysis conducted by an independent third-party, nearly 75 percent of enrollees felt confident they chose the health plan that offered the best value for them and their family, and 87 percent liked being able to choose among multiple carriers.

The Aon Active Health Exchange, the only private exchange for large employers that offers fully insured group health plans from multiple insurance companies, is part of the company's innovative suite of exchange solutions designed to align the interests of the players in the health ecosystem by creating a competitive market for benefits that offers more individuals more choice and transparency over their health benefits.

"Health care cost increases continue to be well above general inflation and remain high for employers and employees," said Timothy Nimmer, fellow of the Society of Actuaries, member of the American Academy of Actuaries and chief health care actuary at Aon Hewitt. "The Aon Active Health Exchange is netting average cost increases that are well below the industry norm, which is positive reinforcement of the overall sustainability and success of our model."

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About Aon Hewitt
Aon Hewitt empowers organizations and individuals to secure a better future through innovative talent, retirement and health solutions. We advise, design and execute a wide range of solutions that enable clients to cultivate talent to drive organizational and personal performance and growth, navigate retirement risk while providing new levels of financial security, and redefine health solutions for greater choice, affordability and wellness. Aon Hewitt is the global leader in human resource solutions, with over 30,000 professionals in 90 countries serving more than 20,000 clients worldwide. For more information on Aon Hewitt, please visit www.aonhewitt.com.

About Aon
Aon plc (NYSE:AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 66,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world's best broker, best insurance intermediary, best reinsurance intermediary, best captives manager, and best employee benefits consulting firm by multiple industry sources. Visit aon.com for more information on Aon and aon.com/manchesterunited to learn about Aon's global partnership with Manchester United.