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What Iowa Employees Value Most – Lessons to be Learned?

Iowa Employment Values StudyAlthough it has been six years since we completed the “Iowa Employment Values Study,” the lessons learned are still important today. In fact, in some cases, we may assume the results are…timeless!

This Study was conducted in 2007 to better understand the opinions, perceptions and values of Iowa employees and how they differ from those of executives in Iowa organizations. With assistance from Data Point Research, Inc., almost 700 people were interviewed from 56 different organizations. Executives numbered 159 while 537 were employees.

The intent of the Study was to ask employees what 11 key workplace ‘values’ were most important to them – and if these values would keep them employed at their particular organization. In addition, we asked the executives within these organizations to rate how important these same values were to their employees. As you might expect, the results were both revealing and, in many cases, reassuring.

The 11 key employment workplace values are listed below in descending order of employee preference. This table clearly shows that:

  • Employees regard every value statement as more important than executives realize.
  • The order of importance of those values to employees was clearly misunderstood by Iowa executives.

NOTE: The questions were presented to respondents using Likert scales. Scored on a 1 to 100 scale, the highest number represents the most positive response.

 Values Study - Workplace Values

From the table we learn that executives understand Respect at the workplace and a sense of Achievement on the job are very important values to their employees. However, when ranked, executives mistakenly believe that Job Security, Money, Employer Leadership, Benefits and Personal Safety are all more important to their employees than the opportunity to Balance work time with family needs.

Here’s the big takeaway from the above table:

The importance of employees having a well-rounded lifestyle is critical to the mental well-being of employees – and Iowa employers should take note.

Some other interesting findings from this Study that may be worth noting, include:

  • By Gender: Female executives are in-tune with female employees. In contrast, male executives underestimated the importance of many values to both male and female employees. The largest disconnect being the importance of Balance and Time to their female employees.
  • By Age: Separated into categories of those younger and those older than 50 years of age, executives under 50 underestimated the importance of workplace values for their employees in all 11 categories. Employees, regardless of age, rated workplace values similarly.
  • By Generation: Generation X employees (born between 1967 – 1976) rated Money as the second least important workplace value, considerably lower than the other generations. All generations of executives significantly underestimated the importance of Balance and Time to all generations of employees.
  • By Income: Lower paid executives clearly underestimated the importance of 10 of the 11 workplace values to employees who earn less than $50,000 (79 percent of the respondents).

This survey was conducted before the full impact of the Great Recession – which began in 2007/2008. My suspicions, however, are that many employee and executive views in today’s environment may be relatively similar to those views found within this Study. Having Respect, a sense of Achievement and a work-life Balance are most assuredly timeless values…

Iowa employees value Respect, Achievement and the opportunity to Balance work time with family needs as most important, even more important than pay. In today’s globally competitive environment, Iowa employers will need to create a culture that is more responsive to these employee needs and values to attract and retain qualified employees. Being appreciated and valued on the job is the number one value to employees. When asked “What is the one main thing your organization could do better?” the answer: “Show appreciation for hard work,” was consistently heard. This is not an expensive solution, as appreciation can be effectively expressed in a non-monetary way.

Similarly, employees who are proud of their organization were significantly more positive about all aspects of their job. Employers are best served to communicate accurate details about the organization to employees and foster employee pride. Organizations may also consider flextime programs that allow for individual needs, as employees responded overwhelmingly in this Study that they value a healthy work and family balance.

I will continue to ‘dust off’ other gems found within this report, which to my knowledge, was the first study of its kind within Iowa that objectively addressed the disconnect between employer-employee opinions on employment values. Performing another Study similar to this one is definitely on my wish list for the future!

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Iowa ‘Partnership’ Exchange – We’ve Only Just Begun

Iowa 'Partnership' Labyrinth

Iowa ‘Partnership’ Labyrinth

As we now know, Iowa has elected to implement a ‘state partnership exchange’ for at least 2014 with the expectation to migrate to its own exchange in subsequent years.

Last year at this time, David P. Lind Benchmark was hired by the State of Iowa to provide background information for Iowa’s Health Benefit Exchange (HBE). We were responsible for providing two reports to the state regarding Iowa’s health coverage marketplace:

  1. Background Research
  2. Background Research & Simulation Modeling

As a sub-contractor to CSG Government Solutions, Inc., our firm worked very closely with Data Point Research (DPR) on both reports. DPR is the firm that we’ve worked with over the past 14 years on our annual “Iowa Employer Benefits Study.” Additionally, we sought the assistance and expertise of Magnum Actuarial Group for their comments, analysis and input on the second report listed above.

During the time of this research, we worked on the premise that Iowa would develop its own HBE, which required a great deal of assumptions about many unanswered PPACA*-related provisions affecting state-based exchanges. Much like examining an onion to determine its core, we took great care in peeling back the many layers of this complex subject in an attempt to learn the core issues specific to all stakeholders within Iowa.

To provide a glimpse of the many complex issues being addressed within the second report, below is the ‘Summary’ as found on pages 6 and 7.

“Under the Affordable Care Act (ACA), private insurers are required to deliver coverage to individuals and small businesses in more open and transparent insurance markets. Beginning in 2014, insurers must offer products with more comparable benefits and cost-sharing. Additionally, they would be required to provide coverage to anyone regardless of any pre-existing health conditions, allowing consumers to more easily shop for coverage. A Health Insurance Exchange (HBE) will facilitate insurance purchasing with the hope that new competition among insurers will help to moderate premiums for individuals and small groups. The Federal government will subsidize the cost of coverage for low and moderate income individuals who buy insurance through the Exchanges.

As with all other states, Iowa will need to make many critical policy decisions to implement new insurance market rules and decide whether and how to operate Exchanges. Many of these decisions may be influenced by how competitive Iowa’s insurance market is perceived to be, with the subsequent results of these decisions affecting how insurance markets operate and the cost of coverage. Because Iowa is highly concentrated with few insurers in both the Individual and Small Group markets, Iowa may lean toward using the purchasing power of an Exchange to counteract the market power of one or a few large insurers. Given the various political and economic dynamics found within Iowa, unique considerations will need to be made to avoid unintended consequences for both the Individual and Small Group markets.

When assessing the Individual and Small Group markets inside the HBE, a key decision that Iowa must address is whether the Iowa HBE should take an Exclusive, Qualifying, or Open approach. The implications stemming from each approach are far-reaching, as it will affect many inter-related issues. Requiring or not requiring carriers to offer their Qualified Health Plans (QHPs) outside the HBE would also provide potential advantages and disadvantages under each scenario. However, it is only after considering whether to standardize the health plans offered both within and outside the Exchange that a combination of choices can be generated to provide some clarity of which paths to seriously consider.

Determining how best to develop and implement the transitional reinsurance program for the individual market is another decision to be made by Iowa. As with the HBE, Iowa will be able to either take an active role in designing and running the reinsurance program or default to a Federal option. If Iowa chooses to run its own program, the next steps would involve forming the reinsurance entity or entities and contracting with an administrator. The analysis indicates that Iowa should seriously consider running its own transitional reinsurance program, but adopt the 2014 assessment rates and reimbursement parameters.

The ACA does not dictate a timeline to merge the Individual and Small Group risk pools, which means that both markets can be merged at any time on or after 2014. Given the complexities of the various reform provisions of ACA for 2014 and beyond, Iowa may wish to experience ACA-required changes to both markets before deciding to merge them. A preliminary analysis performed by The Urban Institute for this report shows that merging both markets would likely lead to higher premiums in the Small Group market and lower premiums in the individual market.

It is difficult to predict the change to the insurance market that would be caused by classifying organizations with 51-100 employees as small groups before the 2016 mandate. The ACA has many moving parts. The creation of a Basic Health Program (BHP) and Exchange along with the possible market disruptions from merging the individual and small market plans, defining sole proprietors as small employers, and adding organizations with 51-100 employees to the small employer definition all interact with each other with various outcomes that are most likely to be unknown.

Iowa may need to first decide whether to merge the Individual and Small Group risk pools before determining the potential impact of sole proprietors being defined as “individuals” or as “small employers.” If the two risk pools are not merged, pricing differences could emerge. In either event, there does not appear to be any compelling ACA-related reason not to include sole proprietors in Iowa’s definition of “small employer” and to allow them to purchase either individual or small group coverage.

Another question to be addressed by Iowa is whether to revise the definition of “small employer” outside the HBE to be consistent with the HBE definition. Successful state Exchanges have often ensured a level playing field between policies in and out of the Exchange by standardizing definitions and regulations. These common regulations and definitions reduce the potential for adverse selection.

By deciding to establish and run its own Health Benefits Exchange (HBE), there are several key considerations for Iowa to make when confronted with the eight main issues found in Milestone 7. Each issue presents unique and complex challenges in addition to the challenges of maintaining and promoting affordable coverage and competitive markets within Iowa. When factoring in the current market conditions inherent within Iowa’s insurance industry, the state must carefully make decisions that will no doubt have both intended and unintended consequences for each insurance market. All issues are intertwined, accentuating the complex decisions the state must eventually address.”

As mentioned earlier in this blog, Iowa has elected a ‘State Partnership Exchange,’ whereby some of these questions may need direction from the federal government, but many will ultimately require difficult decisions from Iowa.

And, so the journey continues…

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PPACA* – Patient Protection & Affordable Care Act

Wellness in Iowa – Not as Expensive as You Might Think (Part II)

Healthy lifestyle concept.Continuing with last week’s blog – much was learned from the 2012 Capital Crossroads Wellness & Community Study. Iowa employers cite these key reasons for not offering wellness programs:

  • Too expensive or no budget – 45 percent
  • No staff to administer program – 40 percent
  • Their organization is too small to offer wellness – 39 percent
  • Difficult to manage program – 23 percent
  • Never considered offering wellness – 23 percent
  • Unsure how to start program – 18 percent
  • No time available to start program – 17 percent
  • Lack of management support – 13 percent
  • Employees are healthy/no need to offer program – 5 percent

Understanding these perceptions can provide a wonderful opportunity to educate employers, regardless of size, on just how easy and inexpensive many basic wellness programs can be. Employer location also appears to determine whether wellness programs are offered. Employers in urban areas (60 percent) are more likely than their rural counterparts (40 percent) to offer at least one wellness program.

In addition, the distribution of wellness offerings varies widely by industry. Over 60 percent of organizations in Finance, Insurance and Real Estate are most likely to offer these programs, while only 21 percent of employers in the Construction industry offer wellness.

Also within this extensive survey of 913 Iowa employers, wellness programs were divided into three categories:

Education and Health Management – of the nearly 70 percent of employers who offer wellness programs, Workplace Safety is the most commonly-offered education program, with more than six in ten employers providing workplace safety education. Education programs that are expected to grow the most in the next year, include managing:

  1. Obesity and cholesterol (about nine percent may offer program in the next 12 months)
  2. Tobacco cessation (8.3 percent)
  3. Hypertension and diabetes (almost 8 percent each)

Preventive and Screening – of the nearly 60 percent of employers who offer Prevention and Screening programs, offer the following:

  • Cold & Flu prevention (50 percent)
  • Blood Pressure Check (34 percent)
  • Cholesterol Check (29 percent)
  • Blood Sugar Check (29 percent)
  • Health Risk Management (29 percent)

Fitness and Nutrition – 57 percent of employers who offer Fitness and Nutrition programs, offer the following:

  • Nearly 40 percent promote healthy eating programs
  • 31 percent include healthy choices in on-site vending machines
  • 25 percent provide fitness memberships
  • 23 percent have on-site exercise programs

Other Findings:

Larger employers reported being most familiar with the Healthiest State Initiatives (HSI), a statewide program that aims to make Iowa the healthiest state in the nation by 2016. There is a clear trend of familiarity with the HSI and the size of the employer. There is also a clear relationship between an employer’s familiarity with the HSI and their willingness to offer a wellness program. Only one in five employers unfamiliar with the HSI offer wellness programs, while four in five employers familiar with HSI do.

The 2012 Capital Crossroads Wellness & Community Study contains many great nuggets of information to assist Iowa employers on implementing and enhancing quality wellness programs.

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