Employee Benefits Purchasing Alliances: Creating Stability in an Unstable World

Abstract

Over the past decade, employee benefits purchasing alliances have flourished across the United States to help employers satisfy their employees’ health care and other needs. Today in California, such alliances are available for all sizes of employers. Small businesses can join one of two such alliances—PacAdvantage and CaliforniaChoice. Midsize employers can join BenefitsAlliance, and large employers can become members of the Pacific Business Group on Health. Purchasing alliances are especially helpful to small and midsize employers, offering them advantages normally reserved for large firms. These include more choices, greater purchasing power, human resource efficiencies and cost savings. They also allow employers to adopt a defined contribution strategy, basing their contribution to employee benefits on the lowest cost plans. These advantages create stability in an unstable benefits world for small and midsize employers.