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Total Worker Health – the Time is Now

Within the past week, the Healthier Workforce Center for Excellence (HWCE) announced the release of a Total Worker Health (TWH) Supplemental issue from the Journal of Occupational and Environmental Medicine (JOEM). Quite a mouthful, isn’t it?

This document contains relevant information for both small and large employers to consider. David P. Lind Benchmark (DPLB) co-authored an article with HWCE entitled, “An Employee Total Health Management-Based Survey of Iowa Employers.” The article addresses health and wellness program activities within Iowa based on a random survey conducted in 2012 by DPLB along with the research expertise of Data Point Research, Inc.

For the last five years, I have had the honor of collaborating with HWCE on many research-related issues regarding health care in Iowa. As part of the University of Iowa College of Public Health, HWCE’s mission is to improve the “health of workers in Iowa and nationally through integrated health promotion and health protection research, collaboration with peer institutions, and dissemination of successful interventions.”

As discussed in the published JOEM article, when comparing the number of employee well-being programs offered within the workplace, a great chasm exists between small Iowa employers and their larger counterparts. Smaller Iowa employers (less than 50 employees), make up 94 percent of all Iowa employers and yet a relatively small number offer well-being initiatives.

Perceived lack of resources certainly affects whether employers will implement the programs discussed in the article. Based on another study we completed in 2012 for Capital Crossroads, there is some hope. Employers without wellness programs appear to see the benefit of offering wellness initiatives but are unsure how to begin the process – and, keep the program sustainable into the future. The key is to find ongoing-community resources to help assist employers.

The aim for all employers is to mitigate increasing healthcare costs and the subsequent health insurance premiums that follow. Having healthy, productive and mentally-engaged employees at the workplace is equally important.

There are many insightful articles found in this JOEM issue. Hopefully, you will find a few gems to help make your “employees healthier, safer, and more productive” within your workplace environment.

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Employer Mandate Delay – The Impact?

Employer Mandate DelaySo what is the big deal with delaying the Affordable Care Act’s employer mandate for one year? How many people will not have access to employer-based coverage as a result? How many businesses would be paying a penalty for not offering affordable coverage to their workforce?

All good questions — and one new study attempts to provide a few responses.

According to the RAND Corporation, a nonprofit research organization, implications from delaying the employer mandate may be as follows:

  • About 1,000 fewer organizations will offer health coverage in 2014 (about 0.02% of all organizations within the U.S.)
  • 300,000 fewer people will have access to affordable insurance in 2014
  • Only about 0.4% of organizations who employ approximately 1.6% of the workforce will pay a penalty for not offering health insurance at all
  • An estimated 1.1% of organizations will pay some penalty for offering unaffordable health coverage (based on current employer contribution rates). This will affect less than 1% of the workforce
  • Due to the one-year delay, the federal government will receive $11 billion less in revenue

RAND also estimated that repealing the employer mandate entirely would result in federal revenue being reduced by about $149 billion over the next 10 years.

Giving employers one more year to digest the employer mandate is considered by many employers to be a welcome relief. However, this delay does prolong the uncertainty in which employers must operate while confronting the Affordable Care Act.

Here in Iowa, over 95 percent of employers who have at least 50 employees already offer health coverage so the impact of this delay affects a small number of the employer population.

Percentage of Employers Offering Health Coverage in Iowa

Additional data reflecting the current Iowa marketplace will be released soon in our 2013 Iowa Employer Benefits Study©, so stay tuned!

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Iowa Number$ on Consumer-Driven Health Plans

Consumer-Driven Health Care in IowaConsumer-Driven Health Plans (CDHP) — a trend, fad or an anomaly in Iowa?

Unsure? So am I.

Let me briefly explain using a few results from past studies.

A CDHP is considered by many to be the next generation of medical coverage that employers will offer to their employees. Under this approach, an employer will allocate a sum of money annually to offset the employees’ portion of a high-deductible plan. By doing this, employers continue to support their employees’ health care needs, while allowing employees to more directly control their own health coverage. The whole concept of CDHPs is to put the patient back into the health care cost equation, where they now have ‘skin in the game’ and should be capable of assessing the true value of health care. 

There are various hybrid arrangements of CDHP’s. The two most common funding vehicles for CDHP’s are Health Reimbursement Arrangements and Health Savings Accounts.

  • Health Reimbursement Arrangement (HRA) – The HRA is an employer-provided fund that must be used by the employee for qualified medical expenses. HRAs allow the employer flexibility in plan design, such as permitting employees to roll over any unused balance into the following year. Typically, employees do not “own” such an account, and any balances are usually forfeited back to the Plan should the employee terminate employment.
  • Health Savings Account (HSA) – HSAs may be funded by the employee, employer or both. HSAs are permanent, portable, tax-favored savings accounts available to anyone with a qualified high-deductible health insurance plan. Because the HSA is owned by the employee, the employee retains control of their HSA even when changing employers.

In 2005, 4.5 percent of Iowa employers (regardless of size) reported they offered some type of a CDHP to their employees. In 2008, over 17 percent of Iowa employers reported offering a CDHP – whether it was a full replacement of other traditional health plans or offered as an option to traditional coverage. Our data was telling us that each year more Iowa employers were jumping on the CDHP bandwagon. This was beginning to look like a big trend in Iowa – not unlike what was being observed in other parts of the country. However, in 2012, something very strange happened. The number of employers reporting CDHP dropped to 13.3 percent.

David P. Lind Benchmark

In addition to observing this supposed-trend reversal, a large number of employers in our 2012 survey (over three-quarters) indicated they were ‘very unlikely’ to offer CDHPs within the next 12 months. This was also a big change from 2005 when only 41.5 percent of employers reported to be ‘very unlikely’ to offer CDHP coverage.

David P. Lind Benchmark

What happened? Not sure, but do have my suspicions.

CDHPs sound great in theory. In fact, I have been on a qualified, high-deductible health plan for at least seven years. Can they reduce unnecessary spending by the employee without undermining the preventive care aspects of coverage? Does the current marketplace offer the appropriate tools that are necessary for the health care ‘consumer’ to become more of an astute purchaser of health care? Frankly, there are national studies that show mixed results regarding these questions. My advice is to carefully review such reports and pay close attention to who commissioned these reports. It can make a difference on how the above questions are addressed.

So are CDHPs a trend, fad or an anomaly in Iowa?

Stay tuned to see what our 2013 Study reveals within the next two months.

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