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HERO Think Tank e-newsletter
Fourth Quarter - 2007
The HERO Think Tank is a nation wide group of employer and provider members who have taken the lead to create employee health management policy, strategy, leadership, and infrastructure. The HERO Think Tank mission is to move EHM forward as a widely accepted and accurately measured strategy to enhance the health of employees and their dependents and thereby, moderate health care costs increases, improve work performance, and maximize well-being. _______________________________________________________________________ It is recommended this e-newsletter be printed and reviewed at your leisure. ________________________________________________________________________
A Note from Bill Whitmer, CEO – HERO For a number of years, those of us in the employee health management (EHM) field have, from time to time, used the statistic that about 20% of the population use approximately 80% of all the health care services. A new report from the Kaiser Family Foundation, who used data from AHRQ, drills down deeper in this population-percent of health care cost equation. They reported that in 2005, 5% of the population used 49% of all the health care services, while 1% used 22.5%. When this is converted into dollars, about $1.02 trillion was spent on 5% of the population, while nearly $450 billion went to provide health care for 1% of the population. The fundamental question when considering these statistics is: Of those in the 1% or 5% brackets, how many had diseases and medical complications caused by smoking, hypertension, obesity, abnormal cholesterol levels, uncontrollable diabetes, and similar modifiable health risks? The concept of the Compression of Morbidity was introduced in 1980 by James Fries, MD. From the beginning, I have been intrigued with the idea that lifestyle can be a factor in pushing back or delaying the onset of major diseases and disability prior to death. Over the years, I have wondered why employers who have early retirees and those involved in Medicare did not have the Compression of Morbidity idea in the middle of their radar screen. Well, it looks like this is starting to happen. In this issue, Jim provides an update on his research and suggests how Compression of Morbidity could be a way to bring employee health management (EHM) together with Medicare. In this issue, we continue to provide information on one of the critical core components that are required to establish employee health management benchmarks and define best practice. In this issue, information is provided on Incentives, why they are important, and the most effective ways to use them. HERO Forum for Employee Health Management Solutions and C. Everett Koop National Health Awards - October 1-3, 2007 – InterContinental – New Orleans – Registration is brisk and limited to 225. As of press time, there are less than 20 registrations available. Please register early. For more information and to register, go to www.the-hero.org. _______________________________________________________________________ A Revisit with the Compression of Morbidity Paradigm In 1999, James Fries, MD, Professor of Medicine at the Stanford University Medical Center wrote about the Compression of Morbidity in a former HERO hard copy newsletter called “The Health Promotion Research Advocate”. In the original report, some of the highlights of Dr. Fries report were:
Because of the importance of this research, we asked Dr. Fries to provide an update on his Compression of Morbidity research and reflect on it’s potential impact on early retirees and Medicare.
Compression of Morbidity: 1980-2007 –An Odyssey of Aging By: James Fries, MD – Professor of Medicine, Stanford University I introduced the term ‘Compression of Morbidity’ in 1980 to argue that the dominant aging paradigm of the day, that of ever-lengthening longevity and ever-expanding sickness, could be reversed. The Compression of Morbidity thesis argued that the onset of chronic illness and disability could be postponed and that this postponement could be greater than increases in longevity, compressing morbidity into a shorter period prior to death. Or as my mother used to say, “You mean if you get sick later in life you won’t be sick as long?”
What is the Compression
of Morbidity? – The Compression arguments were extremely controversial when introduced. One difficulty was that there were no longitudinal studies of morbidity, nor definitive data on health trends, and as a result discussions tended to feature heat more than light. And, old dogmas die hard. The compression thesis, and I, were critiqued by basic scientists, demographers, gerontologists, career pessimists, and even humanists who worried about ‘blaming the victim’. Then, with an increasing focus on these issues, studies began to yield data, and three major lines of evidence documenting morbidity compression began to grow. First, longitudinal studies of disability documented postponement of chronic morbidity onset by 8 to12 years, based on lifestyle changes involving smoking, obesity, and lack of exercise. Second, national longitudinal surveys of disability, now numbering 16, including the National Long-Term Care Survey and the National Health Interview Survey, began to show age-standardized disability rates declining by about 2 % per year from 1982 through 2004, but mortality rates were declining only 1 % a year. This is the operational definition of Compression of Morbidity: morbidity rates are falling faster than mortality rates. Demographers and economists have estimated that, other things remaining equal, a sustained 2 % annual reduction in disability would suffice to keep Medicare solvent through 2050 without increased taxes or decreased benefits. Finally, multiple randomized controlled trials have now documented that lifestyle-oriented health enhancement programs in seniors could be effective, and the prospect of healthy aging programs has become a real one, backed by a new paradigm that made it possible. People can change, and can benefit, at any age. The Senior Risk Reduction Program (SRRP), beginning in late 2007, is a large (85,000 person) randomized controlled trial of selected health enhancement programs in seniors sponsored by Medicare. It is designed to document improvement in health and reductions in Medicare claims. What can Employee Health Management learn from this odyssey? Changes in paradigms require a lot of patience but they can occur. The senior programs can further open the field. Many companies have health plans where early retiree health costs are large or even dominant when compared with costs of active workers. The inflection point where costs begin to rise rapidly is about 55 years of age; the following ten years have high costs to employers from early retirees as well as active workers, and healthier senior programs will be greatly aided by healthier pre-senior programs. There is already discussion of an eventuality where Medicare and the worksite might combine resources to improve pre-senior health. _______________________________________________________________________ 6 Success Facts for Health Incentives By: Sue Lewis, MEd – Senior Vice President, Health & Productivity - IncentOne
The use of employer-sponsored health, wellness and disease management programs, and the use of incentives have been the subject of several recent studies. These include:
Based on current industry research, the use of incentives is clearly a common tactic among employers implementing EHM programs. This leads to a fundamental question: What are the key program design strategies and tactics to ensure incentives will help achieve program goals? Here are 6 key guidelines to consider when designing an effective health incentive program: 1. Identify what behavior you are trying to incent. Why are incentive programs considered in the first place? To drive participation in an employee health management program? To encourage actual behavior change? Clearly defined goals are critically important. Using claims data to identify a specific problem that needs to be addressed with both risk reduction programs and incentives is important. Analyzing the health and wellness status of the employee population through a health risk assessment is key and may be the first place an incentive is applied to encouraging employees to complete the HRA. The strategic goal of health incentives should align with EHM programs: help keep the low risk population at low risk and keep the at-risk and high-risk group from moving into higher, more costly risk categories. Incentive models are starting to differ by these risk segments. 2. Understand what will motivate your employees – and what won’t. Some incentives work for some employees better than others. Understanding what will drive behavior change among your employee population is critical. For instance, industry data indicates that a company trying to get its employees to complete an HRA without incentives may achieve up to 20 percent participation; a well-executed incentives program giving rewards of approximately $100 per employee, coupled with a solid communications strategy and some workplace activities associated with it, can drive participation rates up to 50 percent. Increasing the threshold to $250 per individual has driven participation rates above 70 percent. Some employees will find great value in a $100 gift card; others will more likely appreciate a $250 contribution to a Health Savings Account. It depends upon the needs, corporate culture, and often education level of your employees. Important rules of thumb: Immediate gratification is more powerful than a delayed reward. When possible, provide some portion of the incentives at the point when the person is taking or completing action, not at the end of the quarter or year 3. Identify your preferred method of incentives. After you identify what behaviors you want to encourage, you must decide on what incentives you want to provide, as there are many incentive options for employers to consider. Following are four basic kinds of incentives to be considered:
Gift cards have traditionally been a popular incentive because they are well understood by consumers however, medical premium discount models are rapidly growing in popularity. 4. Choose a vendor smartly. Many vendors can design a program, keep track of participants and administer gift cards or debit cards to participants. However, depending on the size and complexity of your incentives program, you may need more from your vendor. Look for partners that can integrate all of the program data, track participation, goal achievements, and engage the end-user over time. 5. Communicate, Communicate! Employees need to know exactly what they’re being encouraged to do. Employee communications must be simple, direct, and comprehensive. This is critical — an incentives strategy will fail if it’s not supported by a thorough communications program. The rules can be too complicated or expectations can be easily misinterpreted. Start early, announcing the incentives program in a way to make it stand out as something new and different. And keep the notices coming — communication should be ongoing, with regular updates to advise employees of new developments. 6. Adopt a culture of health in the workplace. A good EHM program must allow employees to actually do the things that incentives are encouraging them to do — otherwise, the disconnect will be fatal. Like any other EHM program component, the incentive may be ineffective and could be undermined if the company does not offer a supportive environment. _______________________________________________________________________ Things You May Like to Know Disincentives: Where Do We Stand? Considerable attention has been given to a new health care plan policy by Clarian Health Partners. Clarian, based in Indianapolis, is the result of the merger of the Indiana University Hospital, Methodist Hospital, and the Riley Hospital for Children. Starting in 2009, Clarian will dock employee as much as $30 every two weeks unless they meet weight, LDL cholesterol, and blood pressure guidelines. The new addition to the health care plan is named A Call to Change. The $30 payment is spread across the three risks, with a charge of $10 per risk every two weeks. The penalties are based on a body-mass index of over 29.9%, blood pressure over 140/90, and LDL cholesterol over 130. A number of consulting firms and employee rights groups have commented on this approach. Generally, the consultants defend the action. According to one consultant, “Employers have run out of other options.” The president of an employee rights organization said this trend is “A very dangerous road that could lead to employers controlling everything we do in our private lives”. Source: www.clarian.org and Los Angeles Times, Castillo – July 29, 2007. Obesity: Perception versus Reality Harris Interactive conducted a survey for the National Consumers League. The survey involved 1,978 individuals who were asked a series of questions about overweight and obesity. One question was: Are you overweight or obese? An analysis indicated that 52% said they were overweight and 12% thought they were obese. According to the Centers for Disease Control (CDC), 66% of adults are overweight and 32% are obese. This suggests that the perception of being overweight is too low, but not drastically so. Such is not the case with obesity. Based on BMI, instead of 12% of the study subjects being obese, 34% were obese (BMI-25 to 29.9) or severely obese (BMI-30-34.9) or morbidly obese (BMI-40 or above). Of those who said they were obese, 82% considered themselves just overweight. Questions of cultural bias were also addressed. 61% were of the opinion that obesity is socially unacceptable, 51% indicated that obesity is caused by lack of will power, and 37% said obese employees should pay more for their health insurance. Source: Harris Interactive for the National Consumers League, March Creating a Psychologically Healthy Workplace “When we do opinion survey research, the most frequently cited source of stress is workplace stress”, says Russ Newman, PhD, Executive Director for Professional Practice at the American Psychological Association (APA). Annually APA evaluates and awards corporations that are judged to be “psychologically healthy”. Matthew Grawitch from St. Louis University has identified five categories of practice that contribute to a psychologically healthy workplace. They are:
1. Work-life Balance – This means flex time to be with the children and not working on weekends, 2. Employee Growth and Development – Opportunity for training, development of new skills, and applying what is learned, 3. Health & Safety – Availability and participation in comprehensive employee health management programs and services, 4. Recognition – Money and benefits are important, but things like recognizing the “employee of the month” are too, 5. Involvement – Have workplace teams and encourage input in decision making 6. Good Communication – Top-down and bottom-up communication on a regular basis is invaluable. What company is the best at all of this? One that might be considered is Google, who was named by FORTUNE Magazine as the 2007 Best Place to Work in the United States. Source: American Psychological Association, ________________________________________________________________________ “A person who has health has a thousand wishes, a person who doesn’t, has but one.” Anonymous ________________________________________________________________________ If others in your organization would like to be added to the HERO Think Tank e-newsletter mailing list, send an email to: info@the-hero.org and type “Think Tank e-newsletter” in the subject box.
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