Back Button
Menu Button

Seeking Truth in Health Care (Part I)

Iowa Employer Benefits StudyI recently had the privilege of presenting summary results of the 2012 Iowa Employer Benefits Study© to the Iowa Hospital Association (IHA) Board. This group consists of leaders from hospitals across the state who are confronted with many difficult and disruptive challenges that will forever change how health care will be delivered and paid. It is my view the paradigm shift occurring in the insurance industry, as great as it is, pales in comparison to what is happening in the health care provider world.

Health care is very a humbling subject – the deeper I dig to learn the truths about this vast topic, the less I actually know! What a great paradox – as the health care discussion is both exhilarating and frustrating at the same time.

My message to the IHA Board emanates from four observations about the employer community that come from previous consulting work, discussions with smart professionals, attending regional and national conferences, and from our annual studies. Such observations, in no particular order, are simply stating a few obvious facts:

  1. Health insurance premiums for Iowa employers have increased by 164 percent from 1999 to 2012. A great deal of uncertainty exists for employers about the future of health insurance.
  2. Momentum continues for employers to embrace wellness initiatives – as there is an increasing desire to have both a healthier and a more productive workforce.
  3. Lack of transparency in health care is a major concern and frustration to Iowa employers and their employees. Health insurance has become a huge distraction to employers.
  4. Health care reform is viewed with considerable skepticism by Iowa employers.

Again, I admit these observations are quite elementary, especially for those who follow health care issues and policies. However, it is the potential implications of these observations that will cause major disruption within the health care industry. In next week’s blog, I will address some of those implications and how health providers will most likely be impacted.

Vaclev Havel, a Czech playwright, essayist, poet, dissident and politician (President of the Czech Republic from 1993 – 2003) once said: “Keep the company of those who seek the truth. Run from those who have found it.”

I could not say it any better – especially in the ‘new world’ of health care.

To learn more, we invite you to subscribe to our blog.

Exchange Tally Complete

Tally marksThe “roll call” on Health Insurance Exchange decisions from each state has come and passed on December 14. Each state has the option of operating their own exchange or ‘partnering’ with the federal government to run an exchange. Should the state decide to do neither, they default to a federally-facilitated exchange. Regardless of the decision, the exchange must be ready to cover qualified individuals and small employers by January 1, 2014.

Iowa made the decision to pursue the “Partnership” Exchange, which is a ‘hybrid’ between a Federal Exchange and a State-based Exchange. Given the deadline to make this decision, it was Iowa’s best option for the time being. The Cliff Note version of the Partnership Exchange is that states can choose to:

  • Operate certain plan management functions
  • Operate certain consumer assistance functions
  • Conduct Medicaid and Children’s Health Insurance Program (CHIP) eligibility determinations (or have the Federal Government perform this)

The Department of Health and Human Services (HHS) will perform any remaining exchange functions in order to meet the standards established by the Affordable Care Act (ACA). With its’ decision, Iowa must submit a blueprint to HHS by February 15, 2013. HHS will then issue approvals beginning in March, 2013.

Establishing its’ own exchange takes considerable time and analysis for any state, Iowa included. The Partnership Exchange appears to be a viable solution that will allow Iowa to eventually pursue its’ own exchange – perhaps as early as January 1, 2015. Until then, heavy lifting will be necessary to assure that stakeholders are heard, insurance markets are carefully analyzed, and most importantly, Iowans are best served.

So what is the final tally* of the decisions made by states regarding exchanges for 2014?

  • Partnership Exchange (7 states)
  • Federal Exchange (25 states)
  • State-Based Exchange (18 states and the District of Columbia)

The next year promises to be a very tumultuous period for Iowans regarding health care and health insurance. Iowa employers will need to spend considerable time and energy learning about the changing insurance world that will impact their business. It will not be an easy task.

To learn more, we invite you to subscribe to our blog.

*The Henry Kaiser Family Foundation

Lindex® to be Released Soon!

David P. Lind BenchmarkDuring the second week in January, we will be releasing the Lindex score to the general public. In addition, 2012 Iowa Employer Benefits Study© participants who scored above the statewide “average” will receive their Lindex number prior to Christmas. Below is an explanation of the Lindex and why it matters to Iowa employers.

What is the Lindex®?

There is a vast array of employer benefits and insurance options and costs. How do employers know which sets of benefits are best? It is too difficult to take all of these variables into account. The Lindex simplifies this process. The Lindex is a complex algorithm that measures the availability, costs, and use of many key benefits and provides an indexed number between 0 and 100. It permits organizations to benchmark and compare their benefits to those offered by other organizations across Iowa.

Why should an employer use the Lindex®?

Employee benefits data can be both voluminous and complicated for any employer. The Lindex distills this data into one relevant number to provide clarity. Employers alter their benefits offerings as they adapt to changing economic conditions, but when doing so, they have no way of knowing whether such changes may put them at a competitive disadvantage when recruiting and retaining qualified employees. The Lindex simply allows the employer to compare their overall benefit offering to other employers on an on-going basis. As benefit offerings change, the employer will understand their competitive position at all times. All major benefits offered by employers are factored into the Lindex “score.”

How is it calculated?

About 1,000 organizations participate in the Iowa Employer Benefits Study© on an on-going basis each year. The Lindex is calculated from these study results. It is based on a variety of factors including types of benefits offered and employee costs associated with those benefits. The Lindex ranges from 0 to 100, with low scores indicating fewer and more expensive benefits, and higher scores indicating more benefits being offered at a lower cost.

How do organizations interpret the Lindex®?

As stated, the Lindex ranges from 0 to 100. A higher score indicates that an organization offers its employees more benefits at lower costs. However, benchmarking is important. The Lindex is calculated annually statewide and for each of several industries. An organization can assess their benefits compared to others in their industry throughout the state. For example, an organization with a Lindex of 68 might appear to be somewhat low, but if this score is above the average Lindex score for similar organizations then it could be considered a good score for your organization.

Why can employers trust the Lindex®?

Since 1999, David P. Lind and Data Point Research have conducted over 10,000 interviews with Iowa organizations. Depending upon the benefits offered by each organization, over 250 variables have been collected. That is a lot of information! When combined with the other research conducted, such as the Iowa Employment Values Study© and the professional expertise of David P. Lind Benchmark, the Lindex is an accurate, unbiased summary on employee benefits in Iowa.

How can the Lindex® help employers?

The Lindex provides benefits information from organizations throughout Iowa that can be used to assess, compare and improve your benefits offerings. Organizations can use their Lindex score as a recruiting tool to attract and retain high quality employees. Others can use it to determine whether benefits changes are required to keep their benefit offerings competitive with similar organizations.

How frequently is the Lindex® calculated?

On a statewide level, the Lindex is calculated once a year. New industry-level Lindices are published in addition to Lindices for the four Iowa Congressional Districts. New Lindices will be segmented by employer size, industry, as well as by congressional district.

This new measurement is not only unique to Iowa but to the country as a whole. Stay tuned for more information after the holidays!

To learn more, we invite you to subscribe to our blog.