As inflation continues to impact bank balance sheets, employer-provided health insurance costs are expected to rise another 7% in 2024 due to chronic health conditions, catastrophic claims and rising costs of prescription drugs, according to a survey published in August by the International Foundation of Employee Benefit Plans. Those increases may be harsher when looking specifically at Indiana. Roughly 90% of the nation’s $4.1 trillion in annual health care expenditures are for people with chronic and mental health conditions, according to the Centers for Disease Control. The 2022 America’s Health Rankings placed Indiana 38th in the nation for the prevalence of multiple chronic conditions, 41st and 43rd for smoking and e-cigarette use, respectively, and 43rd in the nation for access to mental health providers. IBA members may be even more susceptible to steeper cost increases due to their smaller staff sizes. “Indiana is a high-cost health care state and banking has some of the highest percentage of claims,” according to Savannah Lowry, vice president and director of human resources at Home Bank, Martinsville. The fight to provide high-quality health coverage while also keeping one of a company’s largest costs in check is incredibly common. In fact, a 2021 UnitedHealthcare survey found that nearly twothirds of employers were struggling to strike that balance. The key is changing employee behavior, according to Shawn Norris. He serves as senior vice president of NFP, an insurance broker that serves as the primary consultant for the IBA Group Insurance Trust. “You can foster both behavior change and employee engagement through a mix of carrots and sticks, plus communication, education, plan design and consumerism,” he said. “But one of the biggest keys to success is awareness and appreciation of what is offered, from vision and values to compensation philosophy and benefit programs.” The world of employee benefits is increasingly complex every year, so there’s no magic bullet. Norris says you have to analyze your specific utilization data to identify risk management opportunities and develop a multi-faceted strategic approach to manage health care costs. One piece of that cost-control puzzle could be joining a larger pool of participants like the IBA Group Insurance Trust to diversify the company’s risk. The risk-sharing structure protects members from the impact of a single or even multiple high-dollar cost incidents by spreading the risk across a broader group of covered employees. This has historically led to greater stability in the cost of health care coverage and the increases relative to the market. “We continue to see significant increases in the cost of other employer-sponsored health care plans, while the IBA plan has provided stability in managing health care costs year-over-year. It’s a very cost-effective plan for member banks,” said David M. Findlay, CEO of Lake City Bank, Warsaw. Findlay is also IBA’s newly elected second vice chairman and chairman of the IBA Group Insurance Trust. “The IBA plan delivers a broader range of services than many other health insurance plans, which has clearly provided our employees with a strong option that protects them and their families. It’s a big part of our commitment to providing team members with the best possible terms and coverage structures.” The IBA understands we are only as successful as our members, which is what led the board to create the Group Insurance Trust back in 1957. Because it is managed by bankers, the Trust understands bankers and banking, giving it an advantage over independent brokers. The Trust currently represents more than 45 Indiana banks and financial institutions. Home Bank has been one of those since 2020. Evan Hoffmeyer Assistant Vice President - Communications Indiana Bankers Association EHoffmeyer@indiana. bank “Any organization is only as strong as the people who bring it to life.” – Shawn Norris, NFP
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