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2018 Iowa Employer Benefits Study© Results
Employers Report 8.4% Increase in Health Premiums

Today, we issued our 19th Iowa Employer Benefits Study© results. As with past studies, the wealth of data is immense. This year’s study found that Iowa employer health insurance premiums increased an average of 8.4 percent from 2017 to 2018.

The 8.4 increase is an average that factors in employers receiving no rate change, an increase or decrease in their health premiums. This number represents the average increase in premiums employers received PRIOR to making design changes to their medical plans – such as increasing cost-sharing arrangements with employees.

The 2018 Iowa Employer Benefits Study© found that average annual premiums for employer and employee contributions (combined) were $6,874 for single coverage and $17,449 for family coverage. Since 1999, the year this study began, the single premium has increased by 233 percent while the family premium has jumped by 217 percent. (NOTE: In a number of slides below, the year 2017 was excluded because no survey was performed.)

During the post-ACA period (2011-2018), total family premiums increased by 31.2 percent, while employees with family coverage experienced an 18.4 percent increase. This information is depicted in the following graph.

How did Iowa employers respond? They continue to ratchet up employee cost-sharing arrangements, by increasing employee premium contributions and plan-sharing responsibilities, resulting in higher deductibles and out-of-pocket maximums.

Iowa employees were asked to contribute an annual average of $1,351 for employee-only coverage, while employees with family members were asked to pay $5,256 annually. Over the course of 19 years (1999-2018), employee contributions have increased by 204 percent for single coverage and 147 percent for family coverage. 

The average 2018 deductible for single coverage is now $1,900, while the family deductible is $3,899. Since 2004, deductibles for both single and family have risen by 236 percent and 229 percent, respectively. Please note, the survey year 2011 was somewhat of an anomaly, as a higher percentage of manufacturing organizations were targeted to be respondents.

The post-ACA period (2011-2018) reveals the deductibles continue to climb for both single and family, approximately 27 percent and 23 percent respectively.

Understandably, employers do not like to pass along increased premiums and medical plan cost-shifting to their employees, as it negatively impacts salary adjustments and purchasing power. With this said, the employer market is considerably more stable than what is currently happening in the individual insurance markets, both in Iowa and nationally.

The above information is just a small fraction of our survey results. The complete 2018 Iowa Employer Benefits Study© is available for purchase and download on this site.

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

Coming Soon! 2018 Iowa Employer Benefits Study©

We are very pleased that 1,001 Iowa employers have responded to our 2018 Iowa Employer Benefits Study©! This number met our goal of having at least 1,000 organizations participate in our 19th survey. The results of this study will be available in early September.

As we prepare to release our 19th Study, here are a few things to keep in mind:

  • The Overall Summary of the 2018 Iowa Employer Benefits Study© will be available for download from our website.
    • Employers who participated in the 2018 Survey will be sent an email in early September to download this report using a specific pass code.
    • Employers who did not participate in the 2018 Survey will be able to download this Overall Summary for a small fee.

We have also updated our benchmarking program – Lindex®  allowing employers to compare their specific benefit offerings with other Iowa employers. Lindex® was developed with simplicity and intuitiveness in mind. In addition to learning how your benefits package compares with other Iowa organizations (using pertinent criteria such as employer size and industry), employers will be able to learn their individual Lindex® score and how their total benefits package compares to Iowa norms. There are some very sophisticated aspects about this benchmark program that will be extremely helpful to employers of all size and industry!

Our 2018 Iowa Employer Benefits Study© and/or Lindex® benchmarking program will be available for purchase in early September.

How can employers determine their Lindex® score?

You can either contact DPLB to learn more or visit with your authorized-benefits consultant to develop your Lindex® score. If your consultant does not currently participate in the Lindex® program, have them contact DPLB to learn how!

Please continue to visit our website to learn when our:

  • 2018 Iowa Employer Benefits Study© is available for download
  • Lindex® benchmark program has been updated with fresh 2018 survey data

An easy way to stay informed is to subscribe to this blog.

Real Healthcare ‘Consumerism’ Begins with Legitimate Transparency

Almost without exception, price transparency in non-medical-related products and services work extraordinarily well in our consumer markets. When price is coupled with quality metrics and easily available for public scrutiny, consumers ultimately determine which products will become successful.

The exception? Healthcare.
But healthcare is changing, albeit very slowly.  Just last week, the Centers for Medicare and Medicaid Services (CMS) issued a final rule that hospitals will be required to post online a list of their standard charges beginning January 1, 2019. Currently, hospitals are required to make this type of information public only when requested. This new, finalized rule requires hospitals to proactively post the information online to “encourage price transparency” and improve “public accessibility.” Additionally, hospitals much update this information annually.

Pricing – Designed to Protect the Sellers of Care

In healthcare, price transparency is similar to a unicorn. We all hear about it, but have yet to actually see (or experience) it in person. I fully understand that we have healthcare pricing tools provided to the public by third-parties that include, but not limited to, insurance companies, a smattering of medical providers, and crafty entrepreneurs who desire to crack the codes of using historical paid claims to determine ‘approximate’ prices within certain marketplaces. To date, price transparency tools for medical services have only nudged a small number of patients to actually use them, according to a new study funded by the NIHCM Foundation, “Consumer Responses to Price Transparency Alone Versus Price Transparency Combined with Reference Pricing.”

Imagine purchasing consumer products, such as groceries, a bicycle or car, and being told by the grocery store or dealership that you will eventually know the cost of that product sometime AFTER the purchase has been made, but NOT before. This scenario is the current state of our medical pricing – we are given approximations prior to the elective care we receive. But because the services have yet to be rendered, opaque pricing is masqueraded as being at least somewhat transparent with ‘approximate’ pricing.

After Medicare and Medicaid impose reimbursement terms on most medical providers, the payment pecking order continues. Insurance companies with the largest number of insureds in a given geographical area will likely receive better payment terms compared to carriers in the same market with fewer insureds. Terms of pricing details are carefully guarded. In fact, depending on the circumstances, favorable pricing terms are considered to be a ‘competitive advantage’ for dominant insurance companies and medical providers, and it is in their best interest that pricing terms be deliberately withheld from the public. Clearly opaque pricing is the modus operandi in healthcare. The magician that can somehow cleverly demonstrate this level of ‘deep pricing magic’ on the popular television show, “America’s Got Talent,” could possibly win the $1 million prize.

Transparent pricing empowers the buyer, while opaque pricing protects the seller. This is the crux of what is happening in healthcare.

As we continue to ‘break the code’ on transparent pricing, we must also focus on the other decision-making tools desired by consumers – quality. In healthcare, appropriateness of care is a quality component, but so too are the outcomes that result from care. Better outcomes in care should parlay to higher quality, right? Receiving safe care should also be a qualifying factor when determining quality of care.

IOWA Health Scores

Recently, a new website went live for Iowans that compares about 50 Iowa hospitals that encompass over 90 percent of hospital claims incurred by Iowa employer plans. The tool, IOWA Health Scores, is developed and sponsored by the Iowa Employer Group, “a coalition of employers and other purchasers that develop joint initiatives to improve quality and affordability of healthcare in Iowa.” Paul Pietzsch is President of Health Policy Corporation of Iowa, the organization that coordinates the activity of the Iowa Employer Group.

According to Mr. Pietzsch, the IOWA Health Scores website is “dedicated to providing the best comparative tools available for Iowans choosing healthcare. For now, that includes only hospitals – and a selected range of quality/patient safety ratings and metrics – but will be expanded over time. This site is intended to be used as a guide and assist consumers asking questions about care for them and their families.”

Is this website perfect? No, but as Voltaire was attributed as saying, “Perfect is the enemy of good.” Pietzsch himself will acknowledge this is merely the first iteration of a long-term goal of selecting measures from reliable sources – national in scope – that are simple for the average Iowa consumer to use when seeking care. The site currently uses the following primary sources to make hospital comparisons:

  1. Quality Measures – CMS Hospital Compare
  2. Patient Safety – Leapfrog Hospital Safety Grade
  3. Patient Experience – CMS Five Star Rating of Patient Experience

Specific measurements used within this website include:

  • Rate of readmission for heart-failure patients
  • Rate of complications from hip/knee replacement
  • Patients who developed blood clots while in hospitals who did not receive appropriate treatment that would prevent it
  • Surgical site infections from colon surgery
  • Average (median) time that patients had to wait before receiving pain medication after arriving to the emergency department with broken bones.

Finding quality-of-care sources online takes time, and frankly, a good dose of trust that this information is not misleading. The Iowa Employer Group has accessed a handful of national measurements from two well-known sources (CMS Compare and Leapfrog) to enable Iowans to compare up to three hospitals on selected quality metrics. The Iowa Employer Group encourages Iowa employers to add this website link to their webpage so that employees and family members can compare Iowa hospitals on different measures.

Check out this website then prepare your next grocery list!

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