Wellness Program
Good HealthGood for EmployeesGood for Business
Americans are Leading Unhealthy Lives
• Only 30% of U.S. adults engage in regular leisure time physical activity
• “Fried chicken” was the fastest growing food category
• 21% of U.S. adults smoke
• 30% of U.S. adults age 20 and over are considered obese
• 18.2 million people (6.3%) in the U.S. are diabetic, with another 41 million people who are “pre-diabetic”
The Effect on Employers
• Our unhealthy lifestyles result in two major problems for employers:
– Escalating health and disability claims costs
– Lost employee productivity
Why Wellness? Why Now?
UNHEALTHY BEHAVIOR
Physical inactivity, poor eating habits, tobacco use, unmanaged stress
HEALTH RISKSObesity, high blood pressure, elevated cholesterol and blood sugar
CHRONIC DISEASEDiabetes, heart disease, hypertension, stroke
HEALTH CARE COSTS
Costs Follow Risks
Healthcare Costs
14% Retention (overhead)
86% Claims
14%
86% Addressing the
Driver“CLAIMS”
Types of Wellness Programs
• Wellness programs fall under two general categories:– Disease Management programs, which
target the 22% of the population who drive 85% of medical claims, often because of chronic illness
– Lifestyle Coaching programs, which target the rest of the population (78%)– Keeps the healthy population healthy– Encourages those at high risk to take
action so they adopt healthier lifestyles in an effort to improve quality of life, reduce claims, and prevent them from moving to the chronically ill population
– Creates a culture of wellness at the workplace
* Leopold, Ronald. Work and Health in the Era of the Aging Workforce, Metropolitan Life Insurance Company
Disease Management
• Between 50-60% of patients are non-compliant with their physicians’ prescribed treatments
• Goal of Disease Management Programs – Increase compliance and decrease relapses in
behavior of employees with chronic illness
– This results in healthier, more productive employees
– Healthcare costs are lowered for employees with chronic conditions that are well-managed and therefore require fewer episodes of acute care (i.e., ER visits, hospital readmissions)
Lifestyle Coaching
• Lifestyle Coaching programs can help employees become more proactive in developing healthy lifestyles and address preventable risk factors before they lead to chronic illness
• Multiple studies have shown that between 50-70% of all diseases are associated with modifiable risk factors and could be prevented
• Most common lifestyle programs which address the two greatest risk factors for preventable disease are:
• smoking cessation
• weight control
Lifestyle Coaching: Smoking Cessation
• The Centers for Disease Control estimates that companies spend $3,856 per smoker per year in direct medical costs and lost productivity
• Smokers generate 31% higher claim costs than non-smokers
Sources: National Business Group on Health Center, Center for Prevention and Health Services
Lifestyle Coaching: Weight Control
• Average absence for a worker who files an obesity-related Short Term Disability claim is 45 days
• Obese individuals have a 30-50% greater risk of developing chronic medical conditions than those who smoke or drink
• Obesity is an independent risk factor for over 30 chronic conditions
• Almost 80% of obese individuals have diabetes, hypertension, CAD., gallbladder disease, high cholesterol, and / or osteoarthritisSources: Leopold, Ronald, Reigning in the Cost of Obesity, Business and
Health; Partnership for Prevention Healthy Workforce 2010
Lifestyle Coaching Program Savings
• Employers who have implemented prevention programs for cardiovascular disease (including smoking cessation and blood pressure and cholesterol monitoring) have seen an average:
– 28% reduction in sick leave
– 26% reduction in health care costs
– 30% reduction in workers’ compensation and disability costs
Source: National Business Group on Health Center, Center for Prevention and Health Services
How To Get Started: Wellness Process
Management Support
Wellness Committee
Program Goals
Incentive Strategy
Resources
Wellness Themes
Employer Sponsored Events
Communications
Participation
Year End Results with Leadership
Management Support
Senior Level Support is Critical!
Control Purse Strings
Allows Time to Support Wellness
Program
Creates Acceptance of Wellness into
the Company’s Culture.
Wellness Committee
Wellness Committee Oversees Program.
Select 4-5 people who are excited about
program
Cross Section of employees – not just
health/fitness conscious people
Enough power to effectively run
program
Program Goals
Identify 3 or 4 Goals.
Possible Goals:
Reduce Health Risks
Better Manage Health Care Costs
Improve Morale
Improve Productivity
Create Culture of Wellness
Incentive Strategy
Soft Tactics Days Off Movie Tickets Gift Cards Water Bottles Peer
Recognitions
Getting Employees to Participate
Hard Tactics (Greatest Outcomes)
Premium Credits / Surcharge
HRA Contributions
Necessary for Participation End of Year Reward: Focus on Long-term Goals
Resources
Blue Cross Blue Shield of RI
Internal Resources
Community Programs: Local Hospitals with
Free Programs
Wellness Company Engagement
Wellness Themes
Feedback from
Employees – Surveys
Wellness Committee Suggestions
Senior Management
Typical Themes
Physical Health
Emotional and Mental Health
Physical Activity
Nutrition
Employer Sponsored Events
Group Challenges
Community Events
Communications
Create Wellness Program Name: Wellness
Committee or Employee Suggestions!
Direct Messages from Management Emails
Positive Mention at Meetings
Posters in Visible Areas
Flyers
Company Newsletters
Participation
Create Tracking Forms
On-line Tracking Systems
Identifies who is Participating in Wellness Program for Rewards.
Year End Results with Leadership
Evaluating Outcomes with Leadership Participation
Reduction in Health Risks
Change in Utilization Patterns
Change in Health Care Costs
0
1
2
3
4
5
6
7
Coors
B of A
Kennecott
Equitable
General Mills
Travelers
Motorola
Pepsi
Dupont
Source: Mercer – May 2006
Dollars Saved for Every $1 Invested
Return On Investments
Average HRA/PHA Participation RatesType of Incentive Percent ParticipationNo Incentive 22%$25 Gift Card 41%$50 Gift Card 45%$150 Gift Card 67%$250 Gift Card 32%$75 Premium Reduction 75%$150 Premium Reduction 60%$250 Premium Reduction 52%$350 Premium Reduction 81%$500 Premium Reduction 85%
Source: PricewaterhouseCoopers’ Health and Wellness Touchstone, 2008Health Risk Assessment participation rate based on incentive
The Importance of Effective Incentives:
Case Study#1
• In year one, smoking decreased by 44% overall. This change was the catalyst in increasing the group’s PHA score by 2 points in the first year, resulting in more than a $148,000 prospective medical claims savings in year one.
Requirement Associate Spouse IncentivePersonal Health Assessment X X 10% premium increase in
2013 if non-compliant.Obtain biometric screening X XParticipate in tobacco cessation program if smoker X X
Case Study #2
• This design resulted in a 96% compliance in the wellness activities needed for the “wellness” benefit design.
• Healthcare expenses increased by less than half the national trend since 2005. 2009 average cost per employee was $7,765 (benchmark for the industry was $8,423.
Requirement IncentivePersonal Health Assessment
Eligibility to opt into a “wellness” benefit design with lower deductibles and employee co-share.Obtain annual physical
Complete at least 1 additional wellness activity
Case Study #3
• Year 1 yielded a 281% increase in PHA participation, and an 86% increase in Wellness Clinic participation.
• Utilizing the PHA, we have been able to assess a 5% increase in physical activity levels in this group, resulting in a potential one-year savings in excess of $13,000.
Requirement Incentive
Personal Health Assessment $50
Obtain annual physical or participate in onsite biometric screening $25
25 hours of wellness programming/ use of exercise log $25
Case Study #4
Requirement Associate Spouse IncentivePersonal Health Assessment X X 10% premium increase the
following year if non-compliant. Also, for being compliant there
was a $100/$200 cash reimbursement at the end of
the year.
Obtain annual physical X XObtain annual dental cleaning X X
Participate in 10 hours of onsite wellness programming in the calendar year X
• Overall compliance was 87% in year one, and 91% in year two.
• Annual well visits increased and more employees self-reported conditions such as high blood pressure and cholesterol in year one. By year two, those conditions made significant improvements.
• The outcomes showed that this program helped detect & manage chronic conditions in earlier stages. Also, healthcare trends have been lower than the comparable benchmark group.
Blue Cross & Blue Shield of Rhode Island Employee Wellness Program
Case Study
BCBSRI
• BCBSRI employs 1040 full-time employees
• Located in Providence Rhode Island
• Background:– 2008 Health Care Costs were on the rise– Utilization of preventative services was low– Increased competition entering Rhode Island Market– Initiated Wellness Incentive Program for BCBSRI employees to:
• Address rising costs through promoting wellness and prevention• Lead by example• Establish a model to sell in the market
• Senior Leadership committed to the program
• Launched January 1, 2009
The evolution of incentives
2009 Incentive and Compliance based Structure
Level Points Incentive (Carrot)
1 250 $25 reward
2 350 $50 reward
3 450 $75 reward
4 550 $100 reward
5 675 $125 reward
Offering Category ParticipantsPHA Required (Compliance) Employees
Wellness Programming Elective (Incentives) Employees
Rewards will be in the form of Visa money cards.Raffles : 5 PTO days
The evolution of incentives
2010 Incentive and Compliance based Structure
Offering Category ParticipantsWellness Pledge Required (Compliance) Employees/Spouse
PHA Required (Compliance) Employees/Spouse
Physician’s Visit Required (Compliance) Employees/Spouse
Dental Visit Required (Compliance) Employees/Spouse
Wellness Clinic (biometrics) Required (Compliance) Employees
Carrot
$100 Visa Card Individual Plan
$200 Visa Card Family Plan
Stick
10% increase in insurance premium contribution
The evolution of incentives
2011 Incentive and Compliance based Structure
Offering Category Participants
PHA Required (Compliance) Employees/Spouse
Physician’s Visit Required (Compliance) Employees/Spouse
Dental Visit Required (Compliance) Employees/Spouse
Carrot
Raffle for free parking spot for 1 year
Raffle for free fitness center membership for 1 year
Raffle for Wii Fit gaming consoles (2 available)
Raffle for $500 VISA Gift Card (2 available)
Stick
5% increase in insurance premium contribution
The evolution of incentives
2012 - The future
Offering Category Participants
PHA Required (Compliance) Employees/Spouse
Physician’s Visit Required (Compliance) Employees/Spouse
Dental Visit Required (Compliance) Employees/SpouseObtain a BMI Screening (less than 30), or take
action to lower your BMIElective (Incentives) Employees
Health & Wellness Programming
Elective (Incentives) Employees
BCBSRI Fitness Center 25 Workouts/Quarter Elective (Incentives) Employees
The evolution of incentives
2012 - The future
Carrot
100 points= $100 HSA Contribution/ $100 Cash Incentive
BMI <30 or take action to lower your BMI = $100 HSA / $100 Cash Incentive
BCBSRI Fitness Center 25 X per Quarter= Free Fitness Center Membership
Stick
10% increase in insurance premium contribution
Incentives and Performance Management
Performance Ranking
2011 Average PHA Score Incentive Completion
Top 78.30 82.9%
Middle 78.17 79.8%
Bottom 77.42 72.2%
• Top performers have: Better PHA scores Better incentive program compliance Lower medical claims costs
• Wellness programming and incentives appeal to talent you aim to retain and incent
Lessons Learned
• Start with a basic incentive model to ease employees into the program
• Best to have an integrated PHA and Incentive Tracking System that will grow with you as your program moves toward outcomes
• Need a strong Communication and Promotional Strategy and multiple channels of communication:
Utilize Health Interest Surveys to gauge interest in different program topics and communication modalities. This allows tailoring of programs to the unique needs of your organization.
Lessons Learned
• Foster enhanced senior management and middle management support
Hold supervisor meetings with middle management to explain how participation in the program can actually improve productivity
• Shift accountability to employees
The message: “We are all in this together”
• Enhance and tweak the incentive packagesto foster maximum participation and potential behavior change
Be sure to check with your legal team prior to implementing an
incentive plan to ensure it complies with all state and federal laws
Recommendations
• In year one, start with no more than 3-4 requirements for compliance (i.e. an annual physical, completed PHA, and one other activity).
• A reasonable alternative must be provided to those employees who have legitimate medical or personal factors that make it impossible for them to participate in health improvement programs (this does coincide with HIPAA’s reasonable alternative nondiscrimination provision). HWI can provide a sample wavier form.
• Be sure to consult with your organizations legal counsel before implementation.
• Employees should be given enough lead time both before and after the implementation of a program in order to plan how they will approach the task of changing their behavior. Lead time will vary based on the specific strategy.
• Clear & concise communication is important to set the tone and expectations of the program.– Memo from CEO “the why”– Frequently asked questions– Incentive design & requirements
Favorite Quote
Take care of the people, and the return on investment will take care of itself.
-- Dr. Dee Edington, University of Michigan, Health Management Research Center
Thank You
Questions?