LMC Insurance and Risk Management announced today it has collaborated with Wellmark Blue Cross and Blue Shield to offer a new type of health insurance pool option for small to medium-sized employers in Iowa that have between 51 and 500 employees. 

The program, known as the Employer Coalition, will be available beginning Jan. 1, with coverage underwritten by Wellmark. The plan will provide a more predictable insurance pool with features designed to stabilize costs long term, simplify administrative burdens, and help employees better understand and use their benefits, the companies said. 

“Our goal is to create an innovative, new health insurance offering derived from the results of information shared from employers across the state of Iowa in our Midwest employer benchmarking survey, Share to Compare,” said Richard DeBartolo, senior vice president of LMC Insurance, based in West Des Moines. “Today, employers in the fully insured market are asking for more influence in the decisions impacting their health insurance programs. Employers are looking at plans and technology designed to drive better consumerism.”

Although new state rules were released in September designed to spur creation of association health plans (AHPs) and multiple employer welfare organizations (MEWAs), this plan is neither of those, DeBartolo said. 

“We didn’t think we needed to go down that path,” he said. Each company participating in the Employer Coalition will be individually rated according to their own employees’ claims experience, but will collectively participate in programs to help improve their companies’ health care costs. 

Iowa Insurance Division spokesman Chance McIlhaney said the division, which must certify employer groups seeking to operate as AHPs or MEWAs, has not yet certified any in either category. 

Although Wellmark jointly released a news release with LMC, officials there did not offer any comment on the plan and did not immediately respond to requests for comments. 

DeBartolo said that LMC has identified a “flagship group” of companies that are interested in participating in the plan, which will ask employers to commit to staying with the plan for at least three years. Among the qualifying criteria is that employers that join the pool must pay at least 50 percent of their total plan premium, which LMC’s survey has shown correlates with more highly engaged employers that keep plan costs lower. 

“We want employers who are serious buyers of health insurance,” he said. “If a company isn’t willing to put a lot of money in [to their health plan], they probably won’t be getting young, healthy people in their group because those people are going to go to an employer who does.” 

As an initial strategy for creating better employee engagement, the plan has no deductibles or co-insurance, because very few people understand those insurance concepts, he said. Rather, participants will deal with a single copayment amount and an out-of-pocket maximum. 

Among other differentiating elements of the plan: All employers in the pool will be invited to participate in semiannual plan meetings to discuss their stake in the pool. “The key message is you have a seat at the table,” DeBartolo said.

The Employer Coalition plan is now available to quote to qualified employers. For more information, visit www.lmcins.com/iowa-health-insurance-pool.