July 15, 2011
Report documents Iowa's 'rural-urban divide' in health care, insurance coverage
Rurally employed Iowans and their employers face mounting challenges maintaining health insurance coverage, including paying significantly higher premiums for higher-deductible, higher co-pay, and higher out-of-pocket maximum coverage when compared to Iowans working for urban organizations, according to a new report from the University of Iowa College of Public Health's Healthier Workforce Center for Excellence.
The report, based on statewide employee and employer survey data, compares health outcomes, primary health care utilization, preventive services, insurance coverage and cost trends among Iowans working for rural-based employers and urban-based employers.
"The rural-urban differences are striking and speak to equity in both employment and health care, especially for small and rural employers and their employees," said author James Merchant, M.D., UI professor of occupational and environmental health and director of the Healthier Workforce Center for Excellence (HWCE). "We call it the rural-urban divide."
The report, "Iowans Speak Out on Their Health--The Rural-Urban Divide," is a collaboration between the Healthier Workforce Center and David P. Lind & Associates, L.L.C. (DPL&A). The project involved a HWCE survey of more than 1,600 Iowa registered voters, as well as new analyses of seven DPL&A statewide annual surveys of Iowa employers between 2004 and 2010. The full report is available online at http://www.realiowans.org.
According to the Iowa Employer Benefits Study, since 2006 the cost of Iowa health insurance for employers has increased an average of more than 10 percent annually while coverage has deteriorated. To cope with rising insurance costs, Iowa employers continue to shift costs to their employees through plan design changes such as higher deductibles. Employee deductibles have doubled since 2005, and rural employees have significantly higher deductibles -- approximately $1,000 more per year for family coverage compared to urban counterparts.
As a result of dramatically increasing health insurance premiums, the authors observed that rurally employed Iowans more frequently adjust health insurance coverage and their health care behaviors, including reducing their utilization of medications, doctors and hospitals.
The rural-urban divide is even more striking depending on employer size, according to the report. A rural worker with family coverage working for a small employer can expect a deductible of more than $4,300 per year. By comparison, the deductible of their urban counterpart is $2,000 less.
"Analyzing seven years of our data has documented trends that are quite disturbing and should be of concern to our entire state," said David Lind, president of DPL&A.
If this trend continues, the annual deductible for rural-based employees would quadruple to a staggering 29 percent of household income in 2020, according to the report. By comparison, deductibles for urban employees are projected to rise to 14 percent of income by 2020.
The increasing cost of health insurance adversely affects Iowa employers as well, the authors note. If current trends continue, by 2020 projected employee and employer combined health care premiums would exceed half of household income, according to the report.
"As Iowa seeks to build new and better jobs, Iowa employers are paying over 10 percent annually in rising insurance premiums, an unsustainable burden increasingly borne by their employees and their families," the report concludes.
STORY SOURCE: The University of Iowa College of Public Health Office of Communications and External Relations, 4258 Westlawn, Iowa City, Iowa 52242
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