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Wellness Key to Small Business Insurance Plan

Posted Aug 24 2008 9:57pm
One solution often discussed for controlling health care costs for small business is letting these employers form "associations" and let them buy insurance as a group. The idea is that this would create a big pool of employees to spread risk around, which would put smaller businesses on the same footing as big business when insurers price group plans for them.



This is also one feature of GOP Sen. John McCain's health care proposal .



Well, a program in Iowa set up to let small employers join together to buy insurance like this hasn't worked out the way sponsors have planned.



Why? So far, according to an article in the Des Moines Register, the policies written to these groups haven't been that much cheaper than plans small businesses can get on their own.

Leisa Fox, a vice president of the Iowa Association of Business and Industry, a group of 1,300 employers, 75 percent of them with less than 100 workers, has an association plan available to members. Results haven't come yet, the paper reports, but the program is only three months old.

Fox remains hopeful. Why? As the paper reports:

[O]ne of the main attractions of the new association plans is that they have strong wellness programs that could pay off within a few years. Those include incentives for participants to have their blood pressure and weight checked and to quit smoking.



The wellness programs are designed to get at the biggest source of health care inflation, which is the prevalence of chronic diseases caused by smoking, obesity and other preventable factors, Fox said.

She hopes the wellness efforts head off a problem that plagued an earlier generation of association health plans. The problem was that employers with relatively healthy workers wound up splitting off because they could get better insurance rates outside the association plans. That left the association plans saddled with relatively unhealthy, expensive workers.

So: Maybe association plans can help hold down employer health care costs--provided a corporate wellness program is involved.
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