There are several private exchanges already operational in the health insurance market, with many others scheduled to launch over the next few months. Public exchanges on the other hand are not scheduled to open until January 1, 2014, by which time, the existing private exchanges would have a couple of years under their belt. Thus, by the time the public exchanges roll out, insurers and commercial payers would be able to collect two years worth of operational results and insights through private exchanges and would be able to get some clarity on the best exchange operation practices and methods.There is a lot of doubt and ambiguities associated with public health insurance exchange with the ACA awaiting Supreme Court ruling and most of the US states reluctant to proceed ahead with their exchanges. To top it all, there is a lack of consistency in various states health insurance exchange implementation efforts. Even if some health insurance exchanges roll out by the January 2014 deadline, there is likely to be administrative and operational complexities after the initial roll out. Private exchanges are also free from most health reform mandates that provide them greater flexibility in choosing their health products and potential insurance markets. For instance public exchanges are allowed to offer insurance to small businesses with 100 or less than 100 employees, at least for the first couple of years until January 2016. Private insurance exchanges are not obligated by any such reform mandate and can offer insurance to small and large businesses irrespective of their organizational setup.The defined contribution plan model has gained much traction among the private exchange implementers as it allows them to attract small and large businesses looking for a pre-defined defined contribution health package. Insurer designed CDHP packages frees employers from the complex task of defining employer and employee contribution for health plans. Employers can utilize the exchanges and offer their employees the option to choose from an array of health plans from the options available at the private insurance exchanges. Facilities such as this further reduce the administrative complexities for businesses as exchanges facilitate and assist employees in enrolling and managing their health coverage. Employers just need to decide on the subsidy values that they want to offer their employees.All healthcare entities are looking for smarter ways to reduce their administrative and health associated costs. Many employers offering insurance coverage to their employees have shown an inclination to exploring health insurance exchanges for administering coverage to their employees. At present as less as 4% of the employers are using the exchange based model to offer coverage to their employees.Private exchanges stand to benefit a lot from their present market standing as the state exchanges plans for most states are in limbo and employers are looking for new and smarter ways to reduce healthcare costs, increase employees access and choices to various plans and improve the wellness quotient of their employees.