OBLIGATION OR OPPORTUNITY?
By Todd Whitthorne
An effective CEO shouldn’t spend too much time worrying about today, or even tomorrow for that matter. Instead, CEOs need to ask, “How should I be preparing my organization for the next five to ten years?” Obviously managing health care will be a primary concern. But what about health?
The term “wellness program” has come a long way in the past decade. It wasn’t long ago that, whenever the term was mentioned, most people would respond with a furrowed brow and a “What’s that?” Today it’s a different story. Now whenever a wellness program is mentioned, more times than not, the response is a nod and an “Oh yeah, we have one of those!”
For most companies, a wellness program is par for the course, much like water coolers, holiday parties and 401(k)’s. The problem is that not all wellness programs are created equal. In fact, most are a waste of time and resources.
Most, but certainly not all.
Here are the five key strategies for creating a successful wellness program.
- Stop calling it a Wellness Program
What does “wellness” even mean? To be honest, the driving force behind these programs is economics, not philanthropy. Companies are encouraging employees to be healthier so they can be more productive and save money. There’s nothing wrong with that — after all, companies exist primarily to generate a profit. Unfortunately that’s become increasingly more difficult in light of annual double-digit increases in the cost of health care.
Wellness is a vague term that usually includes things like lunch-and-learns, fruit and vegetable challenges and fun runs. These activities are all fine, and can contribute to the overall culture of an organization. But if the goal is to improve the health of the troops, it’s imperative to be laser-focused on measureable outcomes. That means making sure to prioritize and incentivize the things that will make a difference, then measuring the results.
Instead of wellness, consider a term like Clinical Improvement Program. Why? Because it all boils down to risk factors — the risk factors that lead to diseases like diabetes, obesity, arthritis, depression, heart disease and cancer.
If the wellness efforts are not measurably improving clinical risk factors, the organization is simply spinning its wheels.
- Look in the Mirror
Is this the kind of company whose goal is to create a culture that holds employees accountable for their behavior, or one that’s interested in offering some wellness options that the workforce may or may not embrace? Either is ok, but the latter won’t do much to slow the production and destruction of disease, nor will it have much economic impact.
If a company really wants to move the needle around health, the leadership must engage in honest dialog, asking some tough questions to determine the core beliefs about the organization’s role in health care.
For example, which of these best reflects the organization’s beliefs?
- The company’s role is to provide access to, and share the cost of, market-competitive health insurance.
- As a provider of health benefits, it is the company’s responsibility to influence employees’ personal behavior as it affects their health.
There is no right or wrong answer, and the organization will likely fall somewhere between the two extremes. The real goal is to help leadership define “rights” and “roles.”
Here’s another question to help an organization define its position regarding health care:
- It is part of HR’s job to design and administer benefits, but health status is a private matter.
- It is part of HR’s job to improve the health status of employees and covered dependents.
Remember that the only way to improve corporate health is to get individuals to change the behaviors impacting the risk factors that lead to health problems — and insurance claims. If an individual has skin in the game, the odds that a positive change will occur improve dramatically. It boils down to accountability.
Think about an individual’s driving habits. Someone who knows that getting a speeding ticket would not cost a dime would not think twice about driving too fast. The same concept applies to personal health. If someone else is paying for the office visit, acid reflux medication or bypass surgery, then an individual is going to be much less likely to skip the Krispy Kreme or go for a walk.
For some companies, the concept is easy to embrace. The leadership understands the status quo is not a sustainable option, and they recognize they must get their employees to participate in their own health care.
Other companies fear the fallout. They believe their employees will complain and morale will suffer. But now that the Affordable Care Act is picking up considerable steam, most employees understand they have to be more accountable. It’s often a matter of how the message is communicated. Are the changes perceived as carrots or sticks?
- Assess Your Problem
If your organization has 100 employees and they reflect the national averages, then:
- 69 are overweight
- 36 of those are obese with a Body Mass Index above 30
- 12 have diabetes
- 37 have pre-diabetes
- 33 have high blood pressure
- 17 have high cholesterol
- 33 have high triglycerides
- 17 smoke
- 95 fail to get enough physical activity
- 62 have sleep issues
- 77 struggle with stress
- 9 suffer from depressive issues
- 41 live with chronic pain
All companies — and their employees — are unique, but most reflect the national averages. Still, it’s extremely helpful for individual companies to collect aggregate data, which requires annual biometric screening. This assessment needs to include height, weight, waist circumference, family health history and blood pressure. It must also include a fasting blood analysis that measures cholesterol, triglycerides, blood glucose and hemoglobin A1c.
The biometric screening can be done in a doctor’s office or during an onsite assessment, during open enrollment or at an annual health fair. Participation in these annual screenings might allow employees to receive a discount on their premiums — up to 30 percent — which is a very powerful “carrot.”
One of the most important lessons from a biometric screening is, in the aggregate, how many employees have diabetes or pre-diabetes? The outcomes can often be shocking, and the health care for someone with diabetes costs at least twice as much as it does for someone without the disease.
The real opportunity to impact both the health of the employees and the cost of health care is to keep those with pre-diabetes from converting to diabetes. More than 90 percent of diabetes is Type II diabetes, which is primarily a lifestyle disease attributed to both obesity and physical inactivity. In other words, it’s preventable. From an impact perspective, this is the low-hanging fruit.
An excellent predictor of diabetic risk is metabolic syndrome, or MetS. Metabolic syndrome is a cluster of conditions — increased blood pressure, high blood glucose, excessive body fat around the waist, elevated HDL cholesterol and elevated triglycerides — that dramatically increases the risk of heart disease, stroke and diabetes. Individuals who have three or more of these factors out of range have metabolic syndrome. It’s estimated that at least 25 percent of adults in the United States have metabolic syndrome, and over 50 percent of adults above the age of 50.
This is a perfect example of why it’s critical to accurately assess the health of the workforce. Unless risk is objectively measured, it’s impossible to know how many serious and expensive illnesses lie in wait.
- Have a Definitive Strategy
After determining risk, it’s possible to develop a strategic game plan. The first step is to combine aggregate biometric data with demographics and claims history to predict future costs. Then the leadership can design a plan to improve employee health and flatten the cost curve.
The cost of health care coverage ultimately boils down to just two factors: utilization and price. To effectively move the needle, both must be addressed.
Aggressively working to improve the health of the workforce will result in lower utilization. Employees simply won’t need as many “ectomies.” For this strategy, it’s important to assess and prioritize risk factors. For instance, if only three percent of the workforce smokes, investing in a smoking cessation program is not a good use of resources. However, if a significant percentage of the workforce has metabolic syndrome, it may be an excellent place to start.
There are multiple solutions that enable employers to measurably improve the health of their workforce. Be sure to look for programs that are scalable and easy to implement, and that offer clinical results. Don’t hesitate to ask for performance guarantees.
It’s also critical to focus on the price an organization is paying for medical procedures and services. There are several stakeholders in the health care equation: patients (employees), employers, doctors, hospitals and insurers. Not all of these stakeholders are aligned and, for a variety of reasons, what patients ultimately end up paying has always been something of a mystery. The idea of asking the doctor, insurance company or hospital what a procedure will cost before having it done was, until recently, almost unheard of. But that’s changing in a hurry. Since employees and employers often both have skin in the game, it makes sense to compare costs before booking an appointment. After all, the cost of a simple MRI can vary from $640 to $1,900 depending on where the service is delivered. The variance for a CT scan is $540 to $2,600. An in-network knee replacement in North Texas can vary from $29,400 at location A to $57,500 at location B.
It’s also important to understand that there is really very little correlation between quality and price. Many times the least expensive option for a particular service or procedure also has the best customer satisfaction scores and lowest complication or readmission rates. Until recently, this type of information was not available to the customer. Now, however, price transparency makes it easy for companies to save money by taking advantage of proven, low-cost solutions.
- Rely on Experts
The key to any successful Clinical Improvement Program to dovetail it with the organization’s health plan. More times than not, companies keep their health care coverage and wellness programs separate. That’s a mistake — the two must be integrated.
While compliant wellness programs have been sanctioned by law since the ‘90s, there are exciting changes ahead for employers. As of January 1, 2014, employers can charge a 30 percent differential on health care premiums based on outcomes such as body mass index, cholesterol, blood pressure and blood glucose, among others. The law allows for a 50 percent differential for smokers.
This gives employers a tremendous ability to hold employees accountable, as long as they follow the rules established by HIPPA, GINA, ADA, ERISA, etc. HIPPA privacy issues matter for companies of all sizes, but can be a particular challenge for smaller organizations.
Health care costs have been rising for years and the worst is yet to come. There are really only two choices: Stand by and pretend everything is going to be fine, or evaluate the options and develop a plan that will measurably improve the physical and fiscal health of the organization. There are hundreds of Texas-based companies doing the latter, and they are reaping significant rewards.
Todd Whitthorne is the president of Dallas-based ACAP Health Consulting. Prior to joining ACAP Health, Todd spent 14 years as president & CEO of Cooper Concepts, a division of the Cooper Aerobics Center where he assisted organizations in developing strategies to increase employee health and productivity and decrease health care related costs.