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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.

Anticipating the Hockey Puck

2015 Iowa Employer Benefits Study“A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.”
Wayne Gretzky, superstar NHL hockey player

Last week I received phenomenal news from our research firm, Data Point Research, indicating that Iowa employers have responded to our latest survey at a record pace! Our annual goal of randomly surveying at least 1,000 employers will be accomplished during the week of June 22 – a few weeks ahead of schedule. Kudos to Data Point!

Having at least 1,000 employers participate in our 17th survey is the next best thing to surveying EVERY employer in Iowa – but certainly a lot less expensive! Through our time-proven survey process, we are able to project highly statistically accurate results. This number of respondents allows us to update our Lindex Online® program providing the accuracy desired within the employer community.

As with each annual survey, we ask Iowa employers the core benefits-related questions, e.g.: health insurance components such as premium, employee contributions, deductibles and co-payments (office calls and Rx). Understanding these many key features is crucial to predict benefit trends in Iowa. This information calculates the Lindex® scores, which serve as Iowa’s employee-benefits index.

We also strive to learn much more from Iowa employers. Gaining insight into their challenges, preferences and behaviors can help us anticipate where that ‘hockey puck’ will eventually travel within the benefits-related healthcare ‘game.’ By asking these questions, like Gretzky, we’re better able to anticipate the direction of the puck.

So what additional modules did we include in this year’s survey? Here are three:

  1. Healthcare outcomes and challenges for employers – Using a six-point scale, employers rate the importance of five outcomes they hope to achieve and five challenges facing their organization.
  2. Employer views on the prevalence of medical errors performed within Iowa.
  3. Do employers see value in having more insurance companies competing for your business, and should healthcare provider systems become their own insurance company?

As in past years, we plan to have the results of this year’s study available by early September, generating both the summary report (Study) and the Lindex Online benchmarking tool. Needless to say, the month of August serves as my ‘tax season!’

As hockey superstar Gretzky also said, “You miss one hundred percent of the shots you don’t take.”

I couldn’t agree more!

To stay abreast of employee benefits and healthcare issues, we invite you to subscribe to our blog.

The Pursuit of Health Information – and Trust

Trusting a Partnership for Health InformationWhen making workplace health-plan decisions, what type of healthcare information is desired by Iowa employers? Do employers know about web-based resources on Iowa hospitals? Who do employers trust to be their primary source for health-related data?

We asked a series of important questions in our 2013 Study. And, you might be surprised by the results.

As you might imagine, the needs and desires can vary greatly based on employer size. Using a 6-point scale, with 6 being ‘most important,’ Iowa employers responded that ‘Cost’ information was most important to have (4.9 score), with the largest of employers (1000+ employees) scoring this a 5.7. ‘Comparing Physicians’ followed next with an overall score of 4.5, while ‘Health Status/Wellness’ and ‘Comparing Hospitals’ both scored 4.4. Healthcare ‘Use’ finished with an overall score of 4.3.

Importance of Health Information to Iowa Employers

As found in the chart below, Iowa employers are unfamiliar with existing web-based resources on Iowa hospitals. Larger employers appear to be more aware of these web resources, but only a very small number of employers reported being ‘Very Aware’ of this on-line information. In case you are curious, some of this information might be found on the Iowa Hospital Association and Iowa Healthcare Collaborative websites. As mentioned earlier, ‘cost’ information appears to be most desired, followed by comparing physicians and hospitals, presumably on quality-related metrics.

Knowledge of Web-based Data on Iowa Hospitals

When employers responded to how optimistic they are on the effectiveness of ‘Medical Homes’ and ‘Chronic Disease Management Programs,’ employers with over 1000 employees were at least twice as likely to be optimistic (43 percent) than smaller employers with under 250 employees. Overall, only 21 percent felt optimistic about these initiatives being effective to improve workforce health. Another 30 percent were not that optimistic and responded that such initiatives will make ‘No Difference.’ Half of all employers indicated that they would need to have more information on both programs before making judgments as to the effectiveness of health improvement.

Primary Care Initiatives in Iowa

So, if organizations desire critical information to make future decisions on workforce health, it begs the question who they desire to be the primary source of this information. This question elicits some very interesting results.

Overall, 27 percent of Iowa employers desire insurance companies to be the primary source of health information. Yet interestingly, the largest employers with 1000+ employees were less likely to desire insurance carriers to be the primary source – only 18 percent voiced their interest. Only three percent of organizations desired the government to be the primary source of health information, which speaks volumes about their lack of appetite for a single-payer system.

Primary Source of Health Data

The preponderance of organizations (two-thirds) voiced their desire for ‘Health Providers’ (hospitals and physicians) to be the primary source of health information to help manage their costs. More questions will need to be asked of organizations in the future as to ‘why’ they desire health providers to be the primary source, but my initial take is simply they appear to trust this source more than other sources.

The healthcare provider community may take some comfort in knowing that a majority of employers view them as a trusted resource. With this trust, however, comes the responsibility to validate and enhance it by providing a greater array of transparent information on costs and delivering higher-quality outcomes. From our 2014 Study, we know that employers expect to receive reasonable costs, consistent quality of care and safe care that is appropriately delivered to patients.

This type of feedback for insurance companies is most assuredly humbling. Yet, it should also re-awaken the pursuit of new initiatives to make inroads on gaining a trust-related partnership with their clients. The silver lining for both health providers and insurance companies reveals lots of room for improvement – and immense opportunities. But opportunities can only happen if relentlessly – and thoughtfully – pursued.

Trust is the currency of commerce. In our healthcare world, we can always use more of it.

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