The wellness path not taken
Original article: https://ebn.benefitnews.com
By Kathleen Koster
With full implementation of health care reform marching along, the landscape of employer-sponsored health benefits will never be the same. As employers turn to private and public exchanges beginning in 2014 as allowed under the Patient Protection and Affordable Care Act, the purpose for and implementation of worksite wellness programs also are likely to change.
Dr. Matthew Liss, East Coast medical director of NBCUniversal Health Services, fears that employers may not see wellness as their responsibility or employees will be less engaged in wellness initiatives because employers won't work as closely with vendors in the exchange.
Employers may not have access to health data as in the past, which could influence their investment in wellness programs, as well as impact incentives for healthy behavior. Liss points to premium reductions for nonsmokers or incentives for going to the gym that are currently offered by working hand in hand with health care providers. Employers may lose this ability to work with vendors while developing wellness incentives if employees receive coverage through a public or private exchange.
Certain populations could lose out
Bryce Williams, the president and CEO of Extend Health, Inc., which operates the nation's largest private exchange recently acquired by Towers Watson, believes that the most likely demographic to move employees into public exchanges would be small employers with 500 or fewer employees. Employers in this situation would be more likely to stop providing or lessen wellness services to workers than those entering private exchanges, he says.
In general, small employers don't have data to show them the best practices in wellness programs, explains Dave Ratcliffe, a principal at Buck Consulting. This could remain the case for small employers whose workers enter the public marketplaces. Ratcliffe adds that the more employers measure their initiatives, the more investment they make into wellness.
In the retail industry, where part-time workers outnumber full-time workers, some employers will reframe their total reward strategy for a post-2014 health care reform world. Some of Ratcliffe's clients in this sector are considering restructuring jobs and recalibrating total remuneration in order to attract, retain and motivate the workforce. For example, he says an employer may limit part-time workers to clock fewer than 30 hours each week, while rewarding top talent with over 30 hours of scheduled work so they can receive the best health benefits as defined under PPACA. While such a workforce restructuring may require more part-time employees who work under 30 hours per week, this framework could be a motivational carrot to drive talent.
Instead of developing wellness programs exclusively to drive down the health cost curve, employers will use wellness to improve population health and the overall productivity.
"Even if your employees are getting coverage through the exchange now, you want to make sure that they are healthy because a healthier employee is a more productive employee," says Julie Stich, research director at the International Foundation of Employee Benefit Plans.
Williams adds that large employers could leverage any savings they absorb through an exchange setup by reinvesting them into employees, especially into their wellness component.
Giving up a global edge?
According to a recent report from Buck Consultants, 87% of global employers recognize managing employee health as their responsibility in 2012, up from 75% in 2010. Further, 49% of multinational employers now have global health promotion strategies, up from 34% in 2004.
Based on these results, employers believe they need a healthy and productive workforce to have an edge in a global economy.
"If you look globally, the universal responses from all of the countries that productivity and reducing presenteeism was the No. 1 goal for their wellness program, [whereas] for U.S. companies, the No. 1 goal is reducing health care costs," Ratcliffe says. For most employers outside the U.S., employees receive coverage from a government-sponsored system, yet they continue to view wellness initiatives as paramount to driving a profit.
Further, the 2014 reinsurance tax (which could increase employers' health insurance costs by 1-2%), a looming 2018 excise tax, mandated benefits and auto-enrollment could all cause employers to consider shifting cost downward and investing more into wellness. In recent years, plan sponsors have managed a 5% trend rate by predominantly cutting benefits or cost-shifting. "From an attraction and retention standpoint, how much more can we afford to continue to cut benefits? So we're left with wellness to manage costs instead of shifting costs," says Ratcliffe.
In the new health care reform environment, Ratcliffe believes incentives and disincentives will play an even larger role in motivating employees to participate and succeed in wellness. PPACA permits an increase of allowable incentive dollars from 20% to 30%, and more employers are using outcomes-based incentives to drive results.
Overall, the U.S. spends roughly 18% of their total GDP on health care, while the rest of the world spends 9.5% on average. However the U.S.'s average rate of obesity is nearly double the rest of the world's (28% compared to 15%), according to 2012 OECD health data.
"Regardless of health care reform, we're not going to be able to compete in the future without making a change," says Ratcliffe.
Vendor relationships also will morph
The private exchange market, whether insured or self-funded, will function more like a group exchange, where the employer contracts with the exchange instead of sending people individually to a public exchange. For these private exchanges, "employers are not losing access to that data because they are still in a group world in 2014," Ratcliffe explains.
Public exchanges may tell a different story. Employers won't get data for people sent to public exchanges, but Ratcliffe doesn't expect many employers will go this route initially in 2014. Farther down the road when there's a viable individual market similar to Medicare, vendor relationships may change.
Employers' relationships with health vendors, in addition to how they measure and run wellness programs, are sure to change in coming years as employers consider private and public exchanges as options to provide insurance coverage to workers. It remains to be seen how exchanges will change wellness initiatives, but it's clear that wellness programs will always be a business imperative to keep workers healthy, productive and satisfied with their employer.
Moving beyond baby steps with wellness
Source: https://ebn.benefitnews.com
By Samuel H. Fleet
Employers want to do the right thing when it comes to health benefits for their employees, not only because it is humane, but also because it makes good business sense to take care of their most important assets. As health benefits have become increasingly costly, employers have struggled to find the key to meeting healthcare needs without breaking the bank. Many have pinned their hopes on wellness initiatives, the most popular offerings including newsletters and websites, weight-loss programs and smoking cessation programs.
Why baby steps are not enough
The earliest wellness initiatives were grounded in the concept that once employees are confronted with information about unhealthy behaviors they will make improvements that will lead to better health.
Information alone, however, is rarely enough to make a difference. Employers are beginning to face the hard truth that giving employees access to wellness support has done little to change the overall health of their workforces. To reach that goal, they have to move beyond providing information to a much more effective level of wellness support: Employee health risk management.
Tying consequences to health risk management
Employee Health Risk Management is an approach that allows employers to actively manage the health risks of their employees. Among the tools are health risk assessments and biometric health screenings to help identify risks that are driving healthcare expenses.
When made mandatory for employees, these tools can be coupled with consequences. Instead of appealing to reason (“if you exercise, you will be healthier”), these advanced wellness initiatives provide both carrots and sticks to link an employee’s actions and outcomes to consequences. For example, people who continue to smoke even after having access to cessation support pay higher premiums for their health care. Or people who join a gym and use it three times a week pay lower premiums. Or a person who agrees to regular cholesterol and blood pressure screening earns an annual bonus. Ultimately the goal is to implement value-based plan designs tailor-made for employee populations.
Finding the right partner
When plans are well-designed, the requirements are both attainable and accompanied by support to help employees succeed. For example, a well-designed plan does not ask an employee to reduce Body Mass Index from 40 to 25 in one year. A 10% or 15% reduction goal, supported by free access to plans like Weight Watchers, and supported with rewards and recognition may inspire the behavioral changes that will lead to a lower BMI with little further encouragement.
Wellness initiatives have always had the right idea: a healthy workforce costs less when it comes to health care benefits. But until recently, most have stopped short of the hard work it takes to get people to change their habits and lifestyles. In the era of health care reform, smart employers are stepping up their wellness efforts to make them more effective, and brokers are leading the way with cost-effective solutions. Now is the time to move beyond baby steps and actively manage the health and well-being of employees and their dependents.
Wellness Programs Can Reduce Worker Medical Costs by 18 Percent: Study
Source: https://www.workforce.com
By Sheena Harrison
Workplace wellness programs can reduce medical costs by more than 18 percent for the average worker, according to a report published by the American College of Occupational and Environmental Medicine.
The January edition of the Journal of Occupational and Environmental Medicine, published by the Elk Grove Village, Illinois-based ACOEM, includes a study titled "Medical Care Savings From Workplace Wellness Programs: What Is a Realistic Savings Potential?"
The report said wellness programs could reduce costs for risks such as physical inactivity, smoking, high blood pressure and obesity. If the risk factors were lowered to "theoretical minimums," health care expenses could be lowered by an average of $650, or 18.4 percent, for all working adults, the study said.
Cost savings can reach up to 28 percent for aging employees and retirees who participate in wellness programs, according to the study.
"Medical care savings from workplace wellness programs will increase with time given that more eligible wellness program members participate, effective control of heightened risk factors improves, and greater risk reversal can be achieved," the report says.
"Healthiest Companies in America" Announced
Healthcare Costs Decline Among Top-Rated Companies as Employees Engage in Performance-Based Wellness Programs
Performance-based health programs deliver substantial results for companies and their employees
Source: https://www.prnewswire.com
CHICAGO, Feb. 23, 2012 /PRNewswire/ -- Interactive Health Solutions, Inc. (IHS) today announced their 2011 "Healthiest Companies in America." Citing clinical and medical claim data from companies' performance-based employee health programs, IHS is presenting the awards for the fifth consecutive year.
The 70 honorees are corporations and organizations nationwide that have created a "culture of wellness," significantly reducing their healthcare costs through widespread employee participation in proactive health and wellness initiatives. The selection process involved evaluating healthcare data for the companies with clinical information demonstrating improved employee health across an index of key indicators.
IHS utilizes comprehensive data-driven analysis to customize care based on the employee's unique personal risk factors. Beginning with an initial health evaluation, IHS identifies individuals with health risks. Upon review of the employee's personal risk factors, a team of qualified health professionals creates an outreach program designed to ensure each individual is on a pathway to health.
"We engage an employer's entire employee population throughout the year to help individuals get and stay healthy. Our approach is highly personal in that we customize goals and a course of action, providing tools and support in a proactive way. This is about staying healthy and possibly even saving lives, as well as containing costs," said Joseph A. O'Brien , President and CEO of IHS.
On average, employers offering the IHS performance-based program reduced their health care costs by 8.4 percent year over year, while 81 percent of enrolled employees achieved or exceeded wellness goals. Market leaders in data-driven health and wellness programs for employee populations, IHS works with more than 1,400 employers with over one million employees.
"We've tracked over 36 million data points to deliver analysis and benchmarks against national norms and peer groups," said O'Brien. "'Healthiest Companies in America' recognizes those companies that do an outstanding job encouraging employees to engage with these programs. It's just one way to showcase this crucial component of containing healthcare costs nationally."
For more information on "Healthiest Companies in America," visit https://www.healthiestcompanies.com/
Five trends in wellness incentives for 2013
Five trends in wellness incentives for 2013
Employers want return of investment for their wellness programs. They want to know what incentive dollars are really being used for. Here are five trends to look for in wellness incentives in 2013.
1. Personalization of incentives
The idea of incentivizing people to participate in wellness programs is one of the few to be embraced with equal enthusiasm across the board.
While the concept held enough innovation and promise to spur health plans and employers to spend over $60 billion last year to motivate consumers to engage in health, incentives have often been primitive in execution. Incentive dollars flow to plan members as reward or encouragement for healthy behaviors, but what consumers do with that money has until now been largely a mystery to employers and health insurers.
A 2009 survey conducted by MasterCard and Harris Interactive found 61% of employees participate in a wellness program if incentives are offered versus only 26% when there is no added incentive. Additionally, 25% of employees reported that being incentivized was actually the driver and the very reason they agreed to enroll in a wellness program at all.
Instead, the answer is to better tailor the incentives to fit the person, and to provide incentives that motivate while driving program ROI. A recent study from the Journal of Economic Psychology shows consumers prefer to be incentivized with cash. Yet the utility of cash (even cash rebated to a paycheck) leads many to decisions that fail to drive long-term engagement, satisfaction and ultimately outcomes.
2. Incentives tailored around health related products and services
Health incentives need to focus on an emotional affinity felt by participants toward earned rewards—a paradigm that has the potential to create the initial embrace of health behavior change and perpetuate it. Yet, today’s healthcare dollars are stretched thin, and employers want to make sure every dime spent on health and wellness programs is targeted to accomplish health goals. They have increasingly offered discounts to fitness clubs, healthy foods, supplements and Weight Watchers as incentives.
3. New focus on analytics
The Patient Protection and Affordable Care Act (PPACA) increases the cap on wellness incentives—now at 20% of an employee’s total health insurance premium cost—to 30% and then 50% by 2014. This provides an opportunity to create an incentive program with influence.
Yet as increasing dollar amounts are being driven towards wellness/incentive programs; understanding exactly how funds are being spent; what they are being spent on; and how the actual spending is impacting outcomes and ROI will be critical to understanding the overall impact and success of wellness incentive programs. To that end, rich new data sets being driven by innovation in payments technology will play a key role over the next 18 to 24 months in determining how funds can better be allocated within programs to achieve results.
4. Deeper integration of wellness incentives into overall care continuum
Through a richer data set of spend analytics tied back into larger Big Data initiatives focused on efficient healthcare dollar allocation, the role of wellness incentives, their impact on behavioral economics, and ultimately their importance within the overall care continuum will be far better understood. Health plans and employers will increasingly have the ability to design and integrate highly targeted incentive dollar programs to reduce costs, and improve outcomes.
5. Continued focus on gamification
The recent gamification of wellness programs, employee challenges and the role that both competition and fun in wellness program engagement will continue, as these wellness tools have proven successful in driving initial and—in many cases—longer term engagement and results. That said, there will be an increased focus in 2013 on the actual currency being offered as rewards.
According to a March 2012 study by Fidelity and the National Business Group on Health, employers on average are spending a $169 per-employee per-year on wellness platforms. Yet they are spending nearly three times that on the actual incentive, or $460 per-employee per-year. The incentive dollars represent the single greatest investment into wellness programs. Until now, these dollars have been limited in their ability to be tangibly measured and evaluated for their effectiveness. This will be a critical area of change in 2013, and one that will fundamentally shift how actual incentive dollars are perceived and utilized across all aspects of healthcare to drive cost reduction.
What Employers Need to Know About the New Proposed Rules of Health Care Reform
PPACA is confusing as it is and staying up with "proposed" and "final" rule clarifications is even harder. We have broken each of the guidelines down further making them easier to understand.
On Nov. 20, 2012, the Department of Health and Human Services issued three sets of proposed rules that provide some of the details on how PPACA will probably unfold. In early December , 2012, they issued two more sets. All rules are still in the “proposed” stage, which means that there may – and likely will – be changes when the final rules are issued.
The proposed rules address:
- Wellness programs under PPACA
- Essential health benefits and determining actuarial value
- Health insurance market reforms
- Benefit and Payment Parameters
- Multi-State Plan Program
Nondiscriminatory Wellness Incentives
The proposed rule largely carries forward the rules that have been in effect since 2006. There still would not be limits on the incentives that may be provided in a program that simply rewards participation, such as a program that pays for flu shots or reimburses the cost of a tobacco cessation program, regardless whether the employee actually quits smoking. Programs that are results-based (which will be called “health-contingent wellness programs”) still would need to meet several conditions, including a limit on the size of the available reward or penalty. Beginning in 2014, the maximum reward/penalty would increase to 50 percent for tobacco nonuse/use and to 30 percent for other health-related standards.
Essential Health Benefits (EHBs) and Actuarial Value
The proposed rule confirms that non-grandfathered plans in the exchanges and the small group market will be required to cover the 10 essential health benefits and provide a benefit expected to pay 60, 70, 80 or 90 percent of expected allowed claims. The proposed rule also says that self-funded plans and those in the large employer market would not need to provide the 10 EHBs; instead, they would need to provide a benefit of at least 60 percent of expected allowed claims and provide coverage for certain core benefits. The proposed rule would consider current year employer contributions to a health savings account (HSA) or a health reimbursement arrangement (HRA) as part of the benefit value calculation.
Market Reforms
The proposed rule confirms that non-grandfathered health insurers (whether operating through or outside of an exchange) would be prohibited from denying coverage to someone because of a pre-existing condition or other health factor. The proposed rule also provides that premiums for policies in the exchanges and individual and small group markets could only vary based upon age, tobacco use, geographic location, and family size and sets out details on how premiums could be calculated.
The “Benefit and Payment Parameters” proposed rule addresses a number of topics. Of particular interest to employers are proposed rules regarding:
- The Temporary Reinsurance Program (TRP): intended to provide funding to cover additional costs associated with covering formerly uninsured individuals who may have unmet health needs. Funding will be provided by assessing all fully insured and self-funded major medical plans.
- Small-business health options program (SHOP) exchanges: The proposed rule provides that, at least through 2016, eligibility for the small-business health option program (SHOP) exchange would be limited to small employers. An employer would be “small” for exchange purposes if it has 100 or fewer employees, although a state could elect to use 50 employees for the limit in 2014 and 2015.
- A timing change for medical loss ratio (MLR) beginning in 2014: The proposed rule provides that MLR payments will be due Sept. 30, beginning in 2014. Beginning next year, if an MLR payment is used to reduce premiums, it would need to be applied to the next premium due after the MLR due date.
- A user fee for those using federally facilitated exchanges: HHS has proposed a user fee of three and one-half percent of premium to cover the cost of running a federally facilitated exchange (FFE) for those states that choose not to run their own exchange.
The “Multi-State Plan Program” proposed rule begins to address the complex topic of multi-state health exchanges. PPACA directs the federal Office of Personnel Management (OPM) to enter into contracts with private health insurance issuers to offer at least two Multi-State Plans (MSPs) through the exchanges. Health insurance issuers who wished to provide an MSP would apply to OPM. OPM would determine which issuers are qualified to become MSP issuers, enter into contracts with the issuers and approve the plans to be offered on exchanges.
Important: These rules are still in the “proposed” stage, which means that there may be changes when the final rule is issued. Employers should view the proposed rules as an indication of how plans will be regulated beginning in 2014, but need to understand that changes are entirely possible.
Small-business owners say wellness has positive financial impact
Survey: 3 in 4 small business owners tout health and wellness programs
While most small businesses don’t offer health and wellness programs to their employees, three of four that offer such programs find the initiatives positively impact their bottom line.
That’s one of the key conclusions of a study of more than 1,000 small-business owners by Humana Inc. (NYSE: HUM), Louisville, Ky., and the National Small Business Administration (NSBA), Washington, D.C. Conducted by the research firm StrategyOne, New York, the study aims to uncover health and wellness needs and barriers facing small businesses in today’s post-recession business recovery.
The survey defines health and wellness programs as initiatives designed encouraging employees to make healthier choices such as getting preventative care, eating right and exercising.
More than 9 in 10 (93 percent) of the study’s respondents consider their employees’ physical and mental health to be important to their financial results, but only one-third express confidence in their ability to help employees manage their well-being.
More than half of the people surveyed maintain that insufficient information is available that pertains to small businesses introducing health and wellness programs. Among companies less than 10 years old, more than six in 10 (63 percent) having already adopted health and wellness programs.
A key factor in small business owners’ decision about whether or not to introduce a health and wellness program rests with employee interest, the study indicates, adding that:
● Startups find their employees, many of them younger, prefer and pursue such offerings.
● 85 percent of startups say wellness programs are worth the investment and 63 percent are already adopting such programs.
● Most startups say these programs aid in recruiting and retaining employees.
While often focused on physical health, well-being programs can impact mental health too, the study notes, adding that:
● High employee stress is the number one concern for small business decision-makers, especially those at smaller companies, with stress levels more than triple other employee well-being concerns.
● Understanding this issue and incorporating stress-management into wellness offerings will be an important consideration for small business owners moving forward.
● 67 percent of respondents say offering programs that help keep employees healthy would be the best health-related option received by employees, versus only 17 percent who say allocating more sick days.
Enhancing employee engagement
By Beth Taylor
Source: https://eba.benefitnews.com
Actively disengaged employees cost more than $300 billion per year in lost productivity alone. That statistic from global consultant Gallup pinpoints the key to long-term success in a corporate wellness program - employee engagement. It is also the most challenging. Short-term success frequently plateaus until engagement slows or stops. The same employees participate in your clients' wellness initiatives, often resulting in missed opportunities to engage employees with the greatest health risks. A rising trend in wellness is to target employee engagement. The following presents three steps for helping clients improve their long-term engagement results.
Incorporate wellness in business
Business strategy that incorporates wellness initiatives sends a clear message throughout the organization that there is value in a healthy workplace. Like any area of performance, your clients should develop metrics that align with company goals, communicate objectives, and obtain feedback. Wellness strategy should focus on total health, including physical, emotional and social health. Measurable business outcomes in areas such as absenteeism, productivity, and safety incidents help refine goals.
Manufacturer Lincoln Industries has received national recognition as a case study in blending wellness initiatives with business strategy. Lincoln provided its employees with the tools for success, control over their results, and recognition through an awards program. By focusing on total health and integrating wellness, safety, and health benefits, this 500-employee company experienced more than 90% employee participation in wellness initiatives, decreased absenteeism and turnover, and lower workers' comp and health care costs.
Incorporating wellness in business strategy is the first step in engaging employees in the process. The message starts with your clients' managers.
Hold management accountable
It is common practice for businesses to hold management accountable for their unit's performance. Successful organizations recognize the link between employee engagement and performance by adding that area to management evaluations.
Management is the front line for implementing your clients' business strategy, which should include wellness initiatives. To create the right environment for a culture of wellness, managers' key performance indicators should include measurements for employee engagement. Some companies go as far as integrating bonuses for their managers for measurable successes.
Visible signs of management accountability have a huge impact on results. For example, some companies post leader boards that share wellness activities results by units, departments or teams. If your clients have a point system for recognition, they can hold managers to two levels of accountability. The first measures the timely posting of results by managers. The second measurement reflects the earned points from the managers' direct reports.
Engage employee champions
Sponsor a company event and inevitably, certain employees emerge as champions. They are the first to volunteer and are quick to lend their support. Every wellness program needs employee champions. Grassroots efforts engage employees; however, you do not want to overlook other potential champions.
Engaging the same employees for every event discourages others from participating. That pattern contributes to wellness programs launching with a bang, and then fizzling away over time.
Making assumptions about employee populations kills even the best strategy. For every organization characterized as entrepreneurial or competitive, you will find employees who don't fit that mold. The quiet "steady Eddy" at your client's fast-paced workplace may be the perfect candidate for tracking award points or providing structure for meetings.
Help your clients recognize the hidden champions or the outside-the-mold employee and understand what motivates the them. For every champion your client engages, it increases the likelihood a buddy will come along for the ride. Another way to encourage the buddy system is by rewarding points to employees when a friend accompanies them to a wellness event.
By learning the motivational push buttons for employees, your client is able to customize wellness communications and activities for better engagement. Creating a winning solution for your clients' wellness programs, like a winning sports team, requires every member of the team be engaged in the same pursuit of success.
Employers Save Big on Wellness Programs
Source: benefitspro.com
Employers betting on wellness programs seem to be making the right call. They’re seeing $1 to $3 decreases in their overall health care costs for every dollar spent, finds a report from the International Foundation of Employee Benefit Plans.
“Without question, employers are beginning to understand the direct connection that wellness initiatives can have on both employee health and health care plan cost savings,” says Michael Wilson, Foundation CEO. “While the primary goal is reducing health costs, we’re also seeing other advantages from wellness initiatives, such as higher employee morale, increased productivity and reduced disability.”
The report also finds that wellness program incentives—such as insurance premium reductions and communications tools like web links and social networks—are used more by organizations that are achieving positive returns on their wellness investment.
Still, only 19 percent of organizations are measuring return on ROI on wellness programs, Wilson says.
IFEBP divided the respondents of the survey into two groups, the ROI group and the non-ROI group based on whether they measured and achieved positive returns.
Insurance premium reductions for participation in wellness programs accounted for the biggest difference between the two groups, with 49 percent of the ROI group providing this incentive as opposed to just 29 percent of the non-ROI group.
Other popular incentives included gift cards and non-cash incentives/prizes/raffles. Those in the ROI group were also more likely than their counterparts to attach incentives to specific types of initiatives such as health screenings (65 percent to 43 percent), health risk assessments (74 percent to 51 percent) and health care coaches/advocates (43 percent to 22 percent).
Participation among members of organizations in the ROI group increased dramatically when incentives are tied to health screenings and health risk assessments, the report shows.
Communication was another factor in achieving positive ROI. And, most organizations (74 percent) experiencing ROI are more likely to have a broader value-based health care strategy that offers initiatives such as health screenings, stress management programs, health risk assessments, and fitness and nutrition programs compared to just 45 percent of the non-ROI group.
“Determining ROI can be of great benefit for employers—leading to increased buy-in from organizational leaders and workers,” says Julie Stich, IFEBP’s director of research.
But she says it’s still not an easy process, as ROI can be “difficult to measure since health improvement may be influenced by a combination of factors and because it can take anywhere from three to five years to see cost-saving results.”
Roughly 650 people from the United States and Canada were surveyed in February.
OUTMATCHED
Fewer employers are offering a company match to their retirement benefits, a new study by the Society for Human Resource Management finds. About two-thirds of companies currently match their employees' contributions today, compared with 75 percent in 2008.