Walgreens to pay employees to select their own health insurance

Walgreens has joined a growing list of companies that will soon provide subsidies to employees who, in turn, will select their health insurance coverage through a private exchange.

On Wednesday, Walgreens announced that in 2014 about 160,000 eligible employees will begin making subsidized purchases of health insurance through a private marketplace run by Aon Hewitt Corporate Health Exchange. Walgreens officials cited rising healthcare costs and opportunities made available by the Affordable Care Act for the switch.

Walgreens officials say the new program will provide more choices and lower the out-of-pocket costs for most employees. Walgreens said the Aon marketplace will offer a variety of benefit options and carriers for medical, dental, vision, pharmacy, and other benefits coverage.

“Under this new program, employees will have expanded choices to personalize their healthcare coverage in a competitive environment, giving our diverse workforce the flexibility they need to meet their healthcare needs,” said Kathleen Wilson-Thompson, Walgreens senior vice president and chief human resources officer. “We will continue to invest in the health of our employees and their dependents while using a marketplace solution that offers a wide variety of plan options that meet the affordability standard of the Patient Protection and Affordable Care Act.”

In recent months, several large corporations have announced plans to have employees purchase health insurance through private exchanges. They include International Business Machines, Time Warner Inc., Sears Holdings Corp., and Darden Restaurants.