For the past 10 years, eBenX has sold procurement, enrollment, billing and payment services directly to mega-companies such as PepsiCo. But with its recent acquisition of online benefits administrator Arbor Associates, the company's using a network of brokers to court the middle market as well. And a new partnership with PeopleSoft extends its reach in the large-employer market. After years of anticipation, eBenX is projecting profitability in the fourth quarter of 2001. Indeed, business viability is becoming more of a critical consideration for online benefits companies.
HR departments have to be cautious.
As a cautionary example, he points to the experience of WebMD Corp. and its BenefitsCentral enrollment and administration product. Now with the stock reduced, WebMD has informed all of their employer groups that they're shutting the system off in June. Like eBenX, UltraLink made its name in the early '90s helping large companies such as Xerox Corp. procure, enroll and administer HMO plans, including bill reconciliation and payment. Working with 450 HMOs and integrating with virtually all HR-information systems products, the company has amassed a client list of 26 Fortune 500 companies. Brokers get the core product for free, and BenefitPoint reaps a cut when products are sold.