Marketers Become Consumer Driven Healthcare `Experts'- the Principal Financial Group Shows Them How.

DES MOINES, Iowa -- Leaders From The Principal Tour the Nation to Educate Marketers on How to Best Serve Clients

Playing to standing-room-only conference centers across the country, leaders of the Principal Financial Group(R) Health Division are helping to educate America's top brokers and their staff about the next chapter in health insurance - consumer driven healthcare. No longer simply an industry buzzword, consumer driven healthcare is now an insurance concept that many employers are researching to resolve the rising cost of healthcare. By providing the complimentary education seminar, "Consumer Driven Healthcare: Choice, Flexibility and Healthy Living all Wrapped into One," The Principal(R) hopes to provide brokers the tools and resources they need to go to their clients with answers.

Health insurance is the top problem facing America's business owners - in fact, over half of those surveyed by the National Federation of Independent Business cited healthcare costs as a "critical" problem. A 2004 study by Deloitte Consulting showed that over 85 percent of employee benefit specialists ranked controlling the cost of health benefits among their top priorities, and one third said they would look to consumer driven health benefit models as a potential option.

"We know from such research that business owners and benefit specialists understand the pros and cons of consumer driven healthcare, and want to learn more. Their natural next step is to contact a trusted employee benefit advisor. The question is, will the advisor be prepared to answer detailed questions about consumer driven healthcare and provide benefit solutions, instead of simply trying to sell products," noted Jerry Ripperger, director of Consumer Health for the Principal Financial Group and co-presenter for the seminar series. "We want to educate marketers on the history and future of consumer driven healthcare, and what it will mean to how they develop healthcare solutions for their clients. It's about identifying for which companies consumer driven healthcare will work, and which will need alternative solutions."

Part of the seminar focuses on the ins and outs of Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHP), including information on what size and character of company would most value these pre-tax healthcare solutions. "Our goal is to help marketers learn how to solve the employers' problems by bringing the right solution at the right time," said Ripperger. "To do this, the marketer must first understand how HSAs and HDHPs work, which employers and employee groups can most benefit from these plans, and how."

The seminars also concentrate on how marketers can communicate the benefits of consumer driven healthcare plans to their employer clients. "Any real significant cost savings will only occur when the financial incentives and health services provided by consumer driven healthcare plans actually improve the employees' health - improved health equates to benefits beyond lower health insurance premiums, but includes reduced absenteeism, lowers workers compensation costs and for the marketer, ultimately creates satisfied customers," noted Ripperger.

Tom McCone, RHU and president of McCone Insurance Group in Dallas, Texas, recently attended the seminar and found The Principal to provide comprehensive information. "While consumer driven healthcare plans are not going to cause health insurance costs to stop increasing, they do provide employers an opportunity to control costs," noted McCone. "The Principal emphasizes the importance of employee education and engagement, and provides educational ideas and tools for employers and employees. The seminar was excellent."

Consumers Entitled, Not Engaged

Not surprisingly, healthcare coverage has consistently been identified by employees of growing companies as the most valued employee benefit, according to the Principal Financial Well-Being Index(SM). A 2003 poll by Harris Interactive reported that, even when made aware that employers are facing big increases in cost of coverage, nearly half of employees still said it is "not fair" that employers pass a significant part of this cost on to them. In fact, 65 percent of Americans thought it was "unreasonable" that health plans do not cover all medical treatments and procedures. These statistics demonstrate the growing challenge employers, employees and the insurance market face in addressing rising healthcare costs - the growing feeling of entitlement in healthcare coverage.

"This growing sense of entitlement to healthcare coverage has contributed to the escalated expenses we experience today. Part of the consumer driven healthcare movement is increasing the participation of the employee in his or her own health," said Jerry Patterson, vice president and chief marketing officer for the Life & Health Segment of The Principal. "To fully understand consumer driven healthcare, marketers must be aware of what trends brought the healthcare industry to where we are today. The Principal will provide not only the product solutions marketers can bring to their clients, but also suggestions for possible behavioral changes employer clients can take back to employees - such as increased physical activity, taking advantage of online wellness resources and understanding the true cost of medical expenses."

"Consumer Driven Healthcare: Choice, Flexibility and Healthy Living all Wrapped into One," by the Principal Financial Group is planned for Atlanta, Ga, Waukesha, Wis., Oak Brook, Ill., Des Moines, Iowa and Indianapolis, Ind. The seminar series has already been held in Grapevine, Texas, East Peoria, Ill., Houston, Texas and Tulsa, Okla.

To learn more about consumer driven healthcare solutions offered by The Principal, contact your local Principal Financial Group financial representative or visit www.principal.com.

About the Principal Financial Group

The Principal Financial Group(R) (The Principal(R))(1) is a leader in offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement and investment services, life and health insurance and banking through its diverse family of financial services companies. A member of the Fortune 500, the Principal Financial Group has $149.8 billion in assets under management(2) and serves some 14.7 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit www.principal.com.

High Deductible Health Plans and custodial services for Health Savings Accounts are provided by Principal Life Insurance Company, a member of The Principal.

(1) "The Principal Financial Group(R)" and "The Principal(R)" are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.

(2) As of March 31, 2004