BI’s Article search uses Boolean search capabilities. If you are not familiar with these principles, here are some quick tips.
To search specifically for more than one word, put the search term in quotation marks. For example, “workers compensation”. This will limit your search to that combination of words.
To search for a combination of terms, use quotations and the & symbol. For example, “hurricane” & “loss”.
Talk of wellness programs is all the rage, but a lack of understanding by employers and employees can undermine even the best of them. Arthur Hall, senior vice president and employee benefits practice leader at USI Insurance Services L.L.C., writes about how wellness programs can affect health care costs.
The goal for most employers when implementing a wellness program is to improve the health of their employees and reduce health care costs.
The spectrum of wellness programs covers anything from no-cost or low-cost options such as newsletters and healthy eating days to comprehensive programs with participation or outcome-based requirements. When an employer implements a well-designed wellness program, it can expect to see a modest reduction in their annual premiums and a significant reduction in their long-term trend.
Understand cost drivers
It is no secret that unmanaged chronic diseases, such as Type 2 diabetes, drive health care costs higher and will continue to do so if they remain unmanaged. The American Heart Association published an article in a 2012 issue of Circulation, which found that a 7% to 10% reduction in weight from lifestyle modifications including diet, physical activity and behavior decreased the risk of several chronic diseases, including diabetes. But it is difficult for wellness companies to project such cost reductions into the future. When an employer cannot see data that illustrate a positive effect on health care costs, the wellness program often becomes stagnant or it is terminated.
Case in point: A food manufacturer with approximately 250 employees needed to cut skyrocketing health care costs but did not want to shift additional costs to their employees. The population health manager and benefits consultant reviewed the company's data and identified a significant number of claims generated from emergency room care that could have been handled by a primary care physician. The company incentivized their employees by reducing their payroll contributions for the next plan year if they visited a primary care physician for a physical in the current plan year. As a result of increasing primary care visits, the client saw a 49 percent reduction in the cost of emergency room care, to $20,500 in 2015 from $40,194 in 2013.
Initially during the renewal process for the current plan year, the senior leadership was hesitant to implement additional wellness initiatives but changed their position after reviewing the health report. The report showed that per-member-per-year health care claims costs had fallen by nearly 26 percent, to $3,707 in 2015 from $4,985 in 2013 and the projected savings for additional wellness initiatives were impressive. The new phase of the wellness program, which focuses on spouses, was introduced at the beginning of the new plan year and the client is seeing a continued decline in emergency room and urgent care facility utilization compared to this time last year.
Make it personal
In addition to reporting on health data, there is a human element to program success. Sharing stories of employees who credit the wellness program with improving or even saving their lives can be motivating and further establish the credibility of a program's effectiveness. Sometimes these stories are about early stage cancers discovered during the preventive screenings, such as mammograms and colonoscopies. With such preventive screening, cancer can be detected early, enabling employers and employees to avoid the financial and other burdens associated with advanced cancer treatment.
For example, a senior executive, a 40-something husband and father who skipped annual physicals due to his active lifestyle and healthy weight, shared a poignant story with his company.
As part of a new wellness initiative, this executive met with his doctor, who diagnosed a heart murmur during a physical. A subsequent echocardiogram revealed a malfunctioning heart valve. A cardiologist confirmed the diagnosis and referred him to a heart surgeon to repair the heart valve.
In preparation for the surgery, the heart surgeon performed an angiogram, revealing a blocked coronary artery that required a bypass. The surgery for the valve repair and coronary artery bypass was successful, and the patient made a full recovery.
The executive said: “If I didn't have my annual physical due to our wellness program, I'm not sure what would have occurred with my health. I can say with full confidence and passion that I believe in this proactive approach to wellness, as it has been life-changing and life-saving for me.”
The value of wellness
A wellness program is an important facet of a benefits plan and careful consideration is needed to develop a strategy that will reduce health care spending and help employees become healthier.
A West Coast-based ethnic food distributor with 600 employees saved approximately $145,000 by implementing diabetes management in its wellness program. Numerous success stories from participants include one employee who shared that she lost 27 pounds, found a caring doctor and got her diabetes under control.
Though a wide range of wellness programs are available, not all are created equal. However, implementing a well-designed program that gets to the root cause of the health care consumption will help an employer make an informed cost management decision. Following this strategy will lead to engaged, healthier, productive employees and lower medical costs.
Arthur Hall is senior vice president and employee benefits practice leader at USI Insurance Services L.L.C. Contact him at 212-706-9416 or firstname.lastname@example.org.
As the federal government gets more determined about prosecuting books and records and internal controls violations, gaps in directors and officers liability cover become apparent. Rodger Laurite, Mark Weintraub and Grady Kellogg of Lockton Financial Services discuss the regulatory trend and how companies can guard against it.