Employers balance disease management, wellness efforts

One key to getting the most value from money spent on health care is using a balanced combination of disease management and wellness programs tailored to the specific needs of an employer's workforce, experts say.

“Even in this financial meltdown, employers have not stopped doing what they are doing,” said Helen Darling, president of the Washington-based National Business Group on Health. “They haven't pulled back on (investing) in general wellness, in supporting a culture of health. They really got the message that if you want to control costs in any way, you've got to keep people healthier.”

If employers focus only on employees with chronic conditions, “they will get some savings a bit faster, but what they will not be addressing is that people who have those conditions in two to five years are people who have lifestyle problems today,” said Bruce Kelley, national leader of data services at Watson Wyatt Worldwide in Minneapolis.

“We have seen some tendency to put more emphasis on the short-term (savings), but I can't think of a client who has abandoned the longer-term strategy” of fostering employee wellness, he said.

Watson Wyatt data show that just 5% of the workforce—those with complex chronic conditions and catastrophic cases—spend about 50% of the health care dollars (see box, next page).

“The lifestyle behavior change literature studies show that right around 50% of (chronic medical) problems are theoretically preventable,” Mr. Kelley added. “We generally recommend a solution that has a short-term cost impact such as disease management, and that (clients) also consider implementing at least one program with a longer-term but more sizable impact like lifestyle behavior change.”

Studies cited by a spokesman for the Disease Management Assn. of America showed reduced hospitalizations for patients in disease management programs.

However, not all disease management programs result in a positive return on employers' investment.

“There's a lot of analysis being done right now to assess whether returns are materializing for disease management programs. Sometimes they do; oftentimes, not,” said Michael Thompson, a principal with PricewaterhouseCoopers L.L.P. in New York. It's important for employers to “figure out how to make it work or say it's not for my population,” he said. “Disease management programs are only as good as how employees engage and change their behavior,” he added.

“It comes back to a broader cultural change, an alignment of incentives, providing a system of support personalized to what people need given their situation,” which requires a wellness approach, Mr. Thompson said.

“It's hard to only engage people with chronic conditions. Disease management programs tend to be received better when they're part of a broader approach to the entire population. You can't sell them on disease management unless you educate them on taking better care of themselves, and that's a wellness concept,” Mr. Thompson said.

“You can't just focus on the 20% of employees who are sickest,” said Michael Puck, director of human resources at Ordnance Systems in Kingsport, Tenn., a unit of BAE Systems Inc. “Statistics have demonstrated that after they have had a bad year healthwise, then the next two years are not that bad. That 20% is a moving target, and age is contributing to the onset of diseases that can lead to catastrophic claims. Wellness programs can have a significant role in preventing those claims.”

Bart Halling, Minneapolis-based vp of product management for consumer-driven and emerging markets at UMR, a unit of UnitedHealth Group Inc., said he is seeing more employers question the value of wellness programs.

“It's becoming more evident through tangible studies that there is a 1.5 to 4 times return on investment for disease management over one to three years, but I think you've got to have a holistic approach,” Mr. Halling said. “If you go all disease management or all wellness, it's not going to work. It's like squeezing a water balloon,” he said.

“It really depends on an employer's unique situation,” said Mike Miele, president of Healthcare Analytics, a division of Gallagher Benefit Services Inc.

“If you have an older population with virtually no turnover, I can guarantee you that disease management would be much more valuable. If I have a young, healthy population with low turnover, that's where I probably want to spend more wellness dollars because they haven't been diagnosed yet with what they're going to get,” he said.

“You see a lot of diversity in how wellness and care management programs are structured” in preferred provider organization plans, said a spokeswoman for the American Assn. of Preferred Provider Organizations.

Employers should “really hold the vendor's feet to the fire in terms of performance,” Mr. Miele said. “Disease management is often measured on activity rather than results,” he said in citing the example of an insurer that guaranteed it would enroll 20% of the population in a disease management program in a set period. However, it turned out enrollment did not mean actively managing care for those employees, he said.

Wellness benefits

“The problem with the disease management focus is...people with diabetes may benefit from wellness programs. Getting someone to cook for themselves and eat well is sometimes more important than someone calling them up and reading their lab test results,” said Rich Williams, chief executive officer of Advanced Plan for Health in Irving, Texas.

“Disease management vendors not only invite the chronically ill who are having significant problems they can do something about, but also a large number of people who would be much better served by a lifestyle program,” Mr. Kelley said.

Jim Smith, president of the Catholic Employee Benefits Group, which serves Roman Catholic dioceses in Texas, said Advanced Plan for Health identified a high percentage of priests in the Tyler, Texas, diocese who had diabetes, so their disease is monitored. In addition, Catholic Employee Benefits Group mandates that all priests undergo an annual physical and made available weight management, nutrition centers and support groups “to help us mitigate that problem and avoid it running out into the future,” he said.

A combined approach can help improve employee health, said Sean McNattin, vp of product management for care solutions at Golden Valley, Minn.-based OptumHealth.

“We've tried to focus only on the 20% of sickest employees; and it has helped curb the (medical cost) trend a bit, but it hasn't wiped it out. So we tried to get ahead of the trend by helping employees stay well or become well,” he said.

“We believe that services along the entire continuum that help a member maintain health and wellness are all important,” said Sherry Brodeur, head of program design and sales support at Aetna Inc. in Fairfax, Va. “A wellness program that successfully works with a member who is obese and has a history of diabetes, if successful in helping manage weight, can also help manage the precondition for diabetes. He won't get it or will get it later in life.”

Wellness and lifestyle management programs are projected to grow at about 20% annually during the next five years, Mr. McNattin said.

For example, OptumHealth Behavioral Solutions recently introduced a Web-based tool to help people map their brain functioning to improve resilience and better manage stress.

“Studies show that chronic stress has a high correlation to the onset of illness” and affects employee productivity and disability, said Dr. Rhonda Robinson Beale, chief medical officer in Los Angeles. Several employers have incorporated the My Brain Solutions tool into their wellness offerings, she said.

The NBGH's Ms. Darling said it at times is difficult to get the sickest employees to participate in disease management and wellness programs.

“If I were sitting where I used to sit (as benefits manager at Xerox Corp.), I would want a very tightly designed, very aggressive program targeting those with serious problems who are likely to be hospitalized in the next year. The only way to save money is to keep them out of the hospital.”

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