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2015 Iowa Employer Benefits Study Results
Employers Report 7.7% Increase in Health Premiums

Press Release on LindexToday, we issued our 17th annual Iowa Employer Benefits Study© results. As you might imagine, there is a wealth of data coming from this year’s survey, but as always, one of the most newsworthy findings is the headline – 7.7 percent.

It is important to distinguish how this increase is determined each year. The 7.7 percent increase is an average that factors in employers receiving no rate change, an increase or decrease in their premiums. This number represents the average increase in premiums employers received PRIOR to making design changes to their medical insurance plans – such as increasing cost-sharing arrangements with employees. After modifying the plan design, the net increase over the past year was 2.8 percent for single premiums and 4.6 percent for family premiums.

We have been surveying employers since 1999 (2001 was the first year we began asking questions on premium adjustments). With this relatively “tame” increase (compared to double-digit increases between 2001 and 2010), Iowa employers reported making the following changes during the past 12 months:

What Employers DID
Since 1999, the annual Iowa single premium has increased 198 percent, while the family premium has increased 184 percent.

Premium History Since 1999

Slide12Since 2000, employee contributions have increased by 139 percent for single coverage and, as indicated in the graph to the right, 132 percent for family coverage. These numbers are more staggering when compared to the average weekly wage (for all industries), which increased 42.7 percent between 2001 and 2014 (Source: Iowa Workforce Development).

We asked Iowa employers to rate the importance of five key healthcare outcomes using a 6-point scale, where 1 means “not at all important” and 6 means “most important.” The top outcome desired by employers (scoring at 4.9) is “Lowering Health Risk of Employees.” Larger employers (250+) are more likely to find each of the five outcomes more important than their smaller counterparts. Urban employers rated these five slightly higher than rural employers.

Desired Healthcare Outcomes

Helathcare ChallengesWhen asked to consider the five key challenges they face in providing healthcare coverage to their employees, using a 6-point scale, the “Unpredictability of healthcare costs” was tops, followed by “Motivating employees to accomplish healthier behaviors.”

A concern in many insurance markets around the country, including Iowa, deals specifically with having adequate insurance competition. Recent consolidations of large insurance companies fuel this topic.

Iowa employers were asked the following question:
“Do you believe having more insurance companies competing for your business will keep health insurance premiums lower?”

A clear majority of overall respondents (61%) indicated that having more insurance companies would keep health premiums lower. All size categories of employers believe this. Urban employers are more receptive of this belief (63%) versus rural employers (58%).

Having More Insurance Carriers in Iowa

The complete 2015 Iowa Employer Benefits Study© will be available for purchase and download very soon.

The above information is just a small fraction of our survey results. To learn more, we invite you to subscribe to our blog.

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