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Health Works Collective > Policy & Law > Public Health > Wellness Programs To Improve Health and Reduce Corporate Expenses
Public Health

Wellness Programs To Improve Health and Reduce Corporate Expenses

StephenSchimpff
Last updated: 2012/01/20 at 9:53 AM
StephenSchimpff
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Some 80% of healthcare costs go to just a few very serious complex chronic diseases including the likes of diabetes and heart failure. But these are all largely preventable with lifestyle adjustments. Unfortunately, we Americans are an over fed (on non-nutritious diets), under exercised, chronically stressed population with 20% of us still smoking. One third of us are frankly obese and another one third are overweight.

Some 80% of healthcare costs go to just a few very serious complex chronic diseases including the likes of diabetes and heart failure. But these are all largely preventable with lifestyle adjustments. Unfortunately, we Americans are an over fed (on non-nutritious diets), under exercised, chronically stressed population with 20% of us still smoking. One third of us are frankly obese and another one third are overweight.

Health care costs could plummet if we could only become a health conscious society where these chronic illnesses became much less common. But we can adjust our lifestyles – if given the proper incentives. Of course, we all hope to live a long time, we cannot change our genes and all too many of us live in socio-economically deprived communities. And as an aging society, “old parts will wear out.”
Incentives work best if there is a noticeable reward in a short time frame – these help to keep us on track. I love the story I heard on NPR’s “All Things Considered.” A lady (an economist) wanted to lose some weight and do it over the Thanksgiving, Christmas and New Year’s period – surely a difficult time to do so. She created a personal incentive by asking a good friend to agree to accept $500 of she did not lose the prescribed weight on time. The message was that her friend had to accept the money if the weight was not off and she was to purchase something special (jewelry, iPad, etc) and flaunt it. The result was that the person paid attention to every thing she ate. Each ice cream temptation was now worth $500. And $500 was an amount which was meaningful to her although not enough to cause real financial deprivation. It worked and she lost the weight.
Another, and very effective approach is a workplace wellness program. I discuss them extensively in The Future of Health Care Delivery. In their basic formulation, the employer offers various programs such as smoking cessation, fitness, dietary stress management, etc. The employee is free to volunteer or not and in return sees a decrease in his share of the healthcare premium of the company.
Assume that a company spends $15,000 annually (the approximate national average) for a married employee’s health premium and normally expects the employee to pay one third or $4500 per year or $375 per month deducted from his pay check. But if he participates the company will reduce his share by a much as $3000 (i.e., the law allows up to 20% of the total to be reduced from the employee’s share for participation) which brings his monthly deduction down to $125 or a $250 per month incentive reflected in increased take home pay per month. This creates a strong incentive to participate in the wellness program.

But accountability is key. This means that the employee must not just attend sessions but actually follow through on, say, a smoking cessation or a fitness program with a health coach.

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Here is a link to an article that outlines some of these concepts in more detail.

What happens? Employees sign up, they participate, they accept accountability in return for the incentive and they become healthier. The company’s health care costs stabilize or possibly even decline. They certainly do not rise like their competitors’ costs do. The staff is healthier, they are more productive and have less sick days and satisfaction scores rise. Clearly a win-win.

TAGGED: wellness

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StephenSchimpff January 20, 2012
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