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From Wellness to Risk Analysis Programs

Why should companies incorporate wellness and risk analysis programs into their offerings for employees?

Healthcare is a $1.3 trillion per year industry in the United States, representing 14% of the GNP. Rapidly escalating health care costs (and associated health care insurance premiums) require that unprecedented attention be paid to chronic disease prevention. Absences cost employers upwards of $74 billion annually. Indirect expenses associated with employees' absences are typically four times higher than actual medical costs .

Ninety-nine percent of chief financial officers view rising health care costs as a concern. As health care costs continue to rise faster than workers ' earning s and inflation, employers continue to look for ways to partner with their employees to mitigate costs and improve the overall health and well-being in the workplace. Wellness programs arc an excellent way for companies to show employees that they care while improving the overall physical and mental health of the organization. Such programs have been in use for a number of years but in tight economic times wellness programs must be perceived as a benefit to the company, not just to employees.

There is a natural connection between healthy employees and benefit to the company. Employees with healthy lifestyles have fewer illnesses and injuries than other workers and they recover from illnesses and injuries faster. Employees who participate in regular physical activity have increased cardiovascular endurance. Those who eat low-fat diets, refrain from smoking, and get adequate rest are adding years to their lives. Employees who do all of the above are more alert, more positive in outlook, and better able to deal effectively with the stress and rapid change of the work environment.

Wellness programs can take many forms and can be as simple or as complex as the company desires. A basic wellness program is primarily information based and seeks to raise awareness and knowledge levels of employees with the hope that employees will choose healthy behaviors associated with diet and exercise. By adding incentives for participation and using services provided by the health plan carrier, a company signals an expectation that employees begin to change lifestyle decisions based on information and behaviors associated with a healthy lifestyle.

The more complex wellness programs arc based on risk analysis which may include biometrics such as pulse measurement, blood pressure, cholesterol and body fat, weight and waist measurements, and aerobic capacity. Participants may also complete a Health Risk Assessment to self-report health behaviors and history. Participants with high risk factors and/or chronic diseases receive coaching designed to change lifestyle behaviors and support disease management protocols,

A company's use of participation incentives combined with a support structure such as employee assistance programs (EAPs) and contracting with companies to provide outbound coaching for health, disease, maternity, disability and absence communicates an investment in behavior choices and changes leading to healthy lifestyles that impact the work environment. The incentive for a company to engage in the more complex wellness programs using risk analysis is tied to a goal of being able to influence the cost of health and worker's compensation insurance over time. A healthy employee group with low utilization of insurance benefits and documentation of reduced risk factors and improving lifestyle behaviors provide insurance carrier underwriters with data that influences assessment of risks and costs associated with the company's employee group.

The continuum of programs from informal wellness to formalized risk analysis programs represents the range of solutions from those employers build on their own to those they build on their own by piecing together offerings from multiple vendors to those they build with the services of a partner who offer one structure for health and productivity services. The continuum of programs represent the degree to which health and productivity ideas and behaviors are integrated into the culture and decision making structure of the management and employee group.

Goal: Increase efficiency of health and productivity programs resulting in better employee health and well-being and reduced health care-related costs.

Tier 1 - Informal Wellness Program

  • Ad hoc Wellness Committee
  • Informal program plan may include events such as Health Fairs, speakers and presentations and health information flyers
  • Voluntary participation
  • Unmonitored participation

Tier 2 - Wellness Program

  • Informal Wellness Committee
  • Program plan to include events such as Health Fairs, speakers and presentations and health information flyers
  • Individually designed wellness plans
  • Voluntary participation
  • Incentives for participation in agreed upon health related activities

Tier 3 - Formal Wellness Program

  • Formal Wellness Committee
  • Program plan to include events such as Health Fairs, speakers and presentations and health information flyers
  • Copyright March 2008 Pacific Benefit Planners
  • Encouraged use of Insurance Carrier website for additional information about health risks, health assessments and disease management
  • Partnership with companies providing structured wellness and health management programs
  • Encouraged participation in coaching activities
  • Voluntary participation
  • Incentives for monitored participation

Tier 4 - Formal Wellness and Risk Analysis Program

  • Formal Wellness Committee
  • Agreement of insurance carrier to reduce health plan premiums in conjunction with implementation of formal risk analysis program
  • Encouraged use of Insurance Carrier website for additional information about health risks, health assessments and disease management
  • Partnership with companies providing structured wellness and health management programs
  • Formal program of Health Risk Assessment (HRA) and Biometrics
  • Voluntary participation in HRA and Biometrics
  • Incentives for participation in HRA and Biometrics
  • Encouraged participation in coaching activities
  • Report of composite data from HRA and Biometrics reported to Insurance Carrier
  • Health risk data and utilization data used by insurance carrier underwriter to determine health plan premium

Tier 5 - Formal Risk Analysis Program

  • Formal Risk Analysis Administration
  • Agreement of insurance carrier to reduce health plan premium s in conjunction with implementation of formal risk analysis program
  • Formal program of HRA and Biometrics
  • Formal program of education about health risk behaviors and disease management protocol s
  • Partnership with a provider of health and productivity management solutions
  • Required participation in risk analysis and education program
  • Required participation in coaching program
  • Incentives for participation
  • Disincentives for failure to participate in risk analysis and education program, for failure to participate in coaching program and maintain disease management protocols and for relapsed risk behavior ranging from differentiation in deductibles, co-payments and co-insurance up to and including loss of job
  • Report of composite data from HRA and Biometric s reported to Insurance Carrier
  • Attendance and absence monitoring and reporting
  • Health risk data, participation data and utilization data used by insurance carrier underwriter to determine health plan premium
  • Participation in health promotion programs, lifestyle coaching and disease management programs data reported to Insurance Carrier


References:

John Smoyer, SPHR
Nationwide Better Health
Integrated Benefits Institute
Kaiser Employer Health Benefits Survey


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