NEW YORK – Walgreens is preparing to make large-scale changes to its company-backed health care programs, the Wall Street Journal reports.

The drug store chain announced yesterday a plan that will provide payments to eligible employees for the subsidized purchase of insurance, beginning next year.

The plan will affect roughly 160,000 employees and will require them to purchase insurance on a private health-insurance marketplace. The company said it was making the move because of rising healthcare costs and compliance-related expenses associated with the new law.

Walgreens joins IBM and Time Warner in changing its benefits. The latter two recently announced plans to move retirees from their own company-administered health plans to private exchanges.

As companies begin fixing the amount that they pay for benefits spending, employees could end up assuming a greater share of the burden if health-care costs increase. At the same time, they will assume greater control over the administration of their healthcare benefits.

"You're completely moving away from a paternalistic employer deciding what's best for employees," said Paul Fronstin, an economist for the Employee Benefit Research Institute in Washington. "Workers don't need their employer anymore for health coverage. They just need the employers' money," he said.

Under Walgreen’s new plan, the company will pay a fixed amount to employees, who are then free to select coverage options in a private insurance exchange run by Aon Hewitt. The options include HMO-style coverage with no deductibles and bare-bones plans with higher deductibles. Workers could pay as little as $5 a month, Walgreen said.

It isn’t clear how much money the move will save Walgreen or whether the workers will face higher costs.

Roughly 24% of employers said they were “likely” over the next five years to provide access to a private or corporate health exchange where workers selected among various options, according to Towers Watson and the National Business Group on Health.