Health care service and their costs are a subject a lot of people have something to say about these days. With the recent announcement regarding MercyOne coming to Albert Lea, I thought I would write in regarding the impact on businesses. I work at Innovance (parent company of Lou-Rich and Almco). We have a self-insured medical plan, which means the company pays directly for every dollar spent. Over the past few years between the company and employees’ out-of-pocket costs, we have spent $3 million annually on just medical claims. This does not include pharmacy or other administrative costs. To help keep our costs down, we joined with five other companies to form our own clinic four years ago. This not only significantly reduced our costs for basic services, but also resulted in the employees having no out-of-pocket costs for the clinic services. This past year we also contracted with a Twin Cities orthopedic surgery group to perform certain surgeries at a considerably lower price. This enabled the company to save money, and again our employees had very little out-of-pocket costs. So, with the discussion of bringing in another provider to Albert Lea, we saw this as another opportunity to help bring competition to our area and reduce our medical costs across additional services. Better yet for the community, this opens up the potential savings to other companies and individuals, not just some of the larger companies that had the size to look at other options. As you can see based on the annual spending, if you apply the 20% to 30% potential cost reductions, you have a significant annual savings. That will allow our employees to reduce their out-of-pocket costs and allow our businesses to be more competitive, not only against Minnesota and United States companies, but also international ones.

One thing that seems to get misinterpreted in the discussions is that people assume that the community no longer wants the Mayo services. On the contrary, you want access to both clinics because this gives a healthy competition for the services and should provide them at a true market rate.

We know all the services will not happen overnight. Basic services will start initially and will grow with the patient load. But to make this happen, funds have to be available for the Healthcare Coalition to purchase and renovate the building. The amount needed is $5 million. This acquires the building, updates the parking lot and HVAC and renovates the interior of the building to get through phase two. As has been reported, an individual who was originally from Albert Lea has pledged $1 million. This amount along with business and personal pledges has gotten the commitments to almost half the amount needed. Now we have to have everyone: businesses, government and individuals step up and provide the other half during November. As the old saying goes, “It’s time to put your money where your mouth is.”

Steve Tufte

CFO

Innovance