Employee WellnessThe new business strategy shaking things

up!

Benjamin PrinzingFounder / Managing PartnerKadalyst Health Partnerswww.kadalyst.com

Wellness Lingo

Business Case

• Chronic diseases related to lifestyle account for 75% of national medical costs. Eleven separate studies by the Centers for Disease Control suggest that worksite wellness programs can produce significant improvements in employee health.

• Heart disease remains the #1 killer of Americans• Approximately, 45% of diseases and deaths are preventable

• People with chronic disease often drive 50% of costs• 20% of members drive 80% of costs• Those with lifestyle risk factors can cost 10% - 70%

more than those not at risk

Business Case

Genetics Behavior Environment Access to Care

20% 50% 20% 10%

Employee Behavior Determines 50% of Health Status and Associated Costs…

…Plus, employees spend a 1/3 of their waking hours at work. Making it an ideal place to promote healthy behaviors that will increase productivity while on paid time.

Iceberg Phenomenon

1 Diseased, diagnosed & controlled

2 Diagnosed, uncontrolled

3 Undiagnosed or wronglydiagnosed disease

4 Risk factors for disease

5 Free of risk factors

Diagnosed disease

Undiagnosed orwrongly diagnosed

disease

25%

75%

Visible Costs

Non-visible Costs

Direct Medical Costs• Medical

• Pharmacy

Indirect Medical Costs• Presenteeism

• Short Term Disability• Long Term Disability

• Absenteeism • Workers Compensation

Indirect costs represent 2-3 times Direct Medical Costs

An Inside Look

Tangible Benefits to Employer

• Increased productivity• Reduced absenteeism• Increased employee retention

• Lower turnover: reduced recruiting and training costs• Worker’s compensation

• Address stress, ergonomics, and other risks that can cause on-the-job injury• Weight Reduction• Enhanced physical activity• Work/Life balance• Improved company morale• Improved employee awareness and engagement• Increase loyalty

Obstacles – Top 10

1. Low program participation2. Little to no executive level buy-in and/or support3. No formal plan4. Inappropriate or wrong programs and/or tools5. Wrong or poor messaging6. Little to no customization (making it your own)7. Unrealistic expectations8. Little to no formal budget9. Not a part of company culture10.Little to no evaluation strategy

What’s a Wellness Program?

Source: Chapman, Planning Wellness, Chapman Institute, 2008, p. 213.

Integrate Health & Wellness Services

Total Health & Productivity

Management

Medical Care•Diabetes education pilot• Injury and medical management

Health Advocate• Provide Direction• Get the Care You Need• Coaching & Outreach Health Plan Design

Environmental DesignBehavioral Health• Work/Family•Work Life Plus

Health Portal•Stay healthy•Health information• Make informed choices

Health Risk Assessment • Assess and track health behaviors• Maintain health• Address health risks

Fitness Centers•Low risk maintenance•High risk reduction

Wellness Programs•Active expansion•Retiree communications/awareness program

Disease Management•High Acuity (identified high cost disease)

•Low Acuity (identified lower cost disease; lifestyle behavior focus)

Case Management

• STD, LTD• Workers’ Compensation• Scattered Absence

Absence Management

Long Term Strategy

Health & Wellness Workflow

Funding Wellness

The Healthy Driver Discount

Results-based wellness is like a good driver discount for group health.

• Drivers with fewer tickets and accidents pay less.

• Non-smokers pay less for life insurance.

• Homeowners with security alarms pay less.

Do you think it is fair for employees who live healthy lifestyles to pay a

lower contribution for their insurance?

• For example, non-smokers pay less than smokers?

Market acceptance and adoption of results-based design programs

Outcomes-based

Outcomes-Based • High Impact ROI – Year one. • Transformative behavior change

in year one with corresponding high member engagement. (97%)

• Requires compliance with 2008 Final Wellness Rules.

• Preferred model of budget conscious employers searching for cost neutral solution.

• Creates cultural shift in employee population with instilled sense of urgency to achieve personalized wellness objectives.

Participation-Based • Promise of projected pay-off in five

years dependent upon % of participation.

• No ability to track participation relative to member behavior change with member engagement limited to the working well.

• Self Reported Participation requires little oversight and zero compliance.

• Preferred model of BUCAs: low cost/low impact, maintains “socialized” status quo contribution strategy, fulfills wellness offering mandate.

• Requires no cultural shift in employee population.

HIPAA Final Wellness Rules

If an incentive is “contingent upon the satisfaction of a health standard”:

It must be re-assessed at least once per year

It must be designed to promote health and wellness

It may not exceed 20% of the total cost of coverage offered (to be raised to 30% effective January 1, 2014)

It must be available to all “similarly situated individuals”

Appeals and “reasonable alternatives” must be included

The availability of appeal must be disclosed in all plan materials

12

3

456

Outcomes-based

NOTE: vendor to manage appeals and gives alternatives if these goals are medically inadvisable or unreasonably difficult due to a medical condition.

Participation and Result Requirements

Category NIH Goals Revised “Gentle” Goals Points

Tobacco/Nicotine: Negative Negative 1

Blood Pressure: <120/80 <140/90 1

Cholesterol: <100 (LDL) <160 (LDL) 1

Body Mass Index:(Body Fat % and Waist Measurements are also considered – automatically!)

<25 <30 1

Kadalyst coordinates biometric screenings for all employees

Each employer can design goals for their culture and budget.

Sample design

Outcomes-based

Choose Plan(s) from Any Carrier or TPA

Total Monthly Premium

Current Employee

Contribution

“Gentle” Contribution Adjustments Based on Wellness Results

$515 $103 +$40 +$20 +$10 +$5 +$0 -$5

$1,212 $242 +$60 +$40 +$25 +$15 +$0 -$10

Employee earns contributionreduction or penalty.

Sample design

Single

Family

Adju

st b

ased

on

poin

ts e

arne

d Non-Participation

Pass 0 Pass 1 Pass 2 Pass 3 Pass 4

Outcomes-based

A minor shift with MAJOR results!Immediate ROI that drives participation.

Outcomes-based

Potential Uses of Funding For Rewards Based Incentives

• Cash Rewards

• HSA Contributions

• 401K Contributions

• Gift Cards

• Voluntary Product Offerings

• Paid Vacation Days

Outcomes-based

Results-based programs drive RESULTS!Employees earn points by achieving healthy and reasonable goals

10-Step Plan Design

10-Step Wellness Plan Design

STEP 1:Planning Committee

STEP 2:Needs Analysis

STEP 3:

Setting Goals

STEP 4:Pick a Framework

STEP 5: Mission & Brand

STEP 6:

Select Initiatives

STEP 7:

Action Plan

STEP 8:

Prepare the Budget

STEP 9:

Communication Plan

STEP 10:Evaluate Plan

Step-1: Planning Committee

• Keep it small (3-5 members)• Appoint a chair person• Include an Influencer (Exec. OR Exec. Assist.)

• Establish a Meeting Calendar • (wkly, monthly, qrtly)

Step-2: Needs Analysis

1. Organizational structure/locations2. Employee demographics (age, gender,3. health status)4. Benefit plan enrollees5. Company policies & procedures

(employee handbook)6. Cultural audit7. Industry & facility functions8. Health claims data:

– Total health care cost per employee per year and top ten leading physical and mental health claim conditions

9. Employee health risk data (via HRA)10. Biometric data

– Full lipid panel, blood glucose

11. Physical assessment data– Height, weight, blood pressure, BMI, heart

rate, body-fat%

12. Job satisfaction13. Pharmacy data14. Absenteeism data15. Accident reports16. Short and long-term disability claims17. Workers compensation claims18. Presenteeism data through self-reported

surveys19. Review of current health promotion

activities such as participation and completion rates of specific initiatives

20. Employee turnover report21. Health plan benefits22. Other health benefits including

Step-2: The Findings

Worksite Wellness Assessment

(Wellness Program Scorecard)

Senior management completed a comprehensive survey that takes a subjective look at specific program components, such as leadership support and environmental policies. Findings (as assumed due to year-1 programming) identified all aspects of programming either need to be implemented or enhanced. Out of 70 possible points, our company scored 12, or 17%. Improvement opportunities include each evaluated component:

Infrastructure – including program branding, wellness committee and operating plan

Program Components – including education, awareness and incentives

Physical Activity Programs Nutrition Programs Mental Health / Stress Tobacco Use Assessment & Evaluation  

Employee Interest Survey

The following were identified as areas of interest by our employees:

Health screenings Physical activity Stress management

Educational programs Healthy eating Financial wellness 

Health Risk Assessment

The following were identified as areas for improvement:   56% of the employee population is either overweight and obese 20% frequently use tobacco products 51% frequently consume sugary foods 51% have not had a physical exam in over 24 months 71% do not have a primary care doctor 33% have depression symptoms and 26% have frequent stress

Workforce Demographics

125 employees 35 store locations 70% Caucasian

Median age of 27 Staff members mainly work within a retail environment Easy access to smartphones, email and the Internet

Step-3: Set Realistic Goals

Goal1. Rationale

2. Objectives

3. Strategies• Promotion• Actvities

• Policies, etc.

4. Resources Needed

5. Timelines

6. Evaluation

Step-4: Program Focus

Accountability

Action

Activity

Awareness

Program Requirement Samples

Step-4: Program Model

Step-5: Purpose & Branding

• Based on goals you can now…• Establish a clear mission & vision statement• Create a brand; name, logo, tagline and theme

Step-6: Select Initiatives

Individual

Environment

Policy

Step-7: Action Plan

Activity/Program/Policy Materials & Resources OwnerTime frame

Evaluate P I EEst. Hrs.

Budget

Provide educational handouts on physical activity via Newsletters

Materials available on coaching portal and additional resources can be provided on company Intranet

Nancy Ongoing n/a   ✔ ✔ 1 $.12/per

Create a walk-and-talk meeting policySupervisors will support this as a standard work practice. An informal policy can be written.

Tony Aug. 2013 n/a ✔     0.5 n/a

Activity/Program/Policy Materials & Resources OwnerTime frame

Evaluate P I EEst. Hrs.

Budget

Promote physical activity challenge(s)Separate action plan tracker (use Appendix D), communication plan, announcement letter, sign-up, etc.

JodyAug. 2013Jan. 2014

Participation & Sat. Survey

  ✔ ✔ 8-10 $2 PEPM

Promote health coaching to develop individual exercise routines

Coaches within session will setup individual trackers

Bill Aug. 2013Activity Tracker Report

  ✔   N/A$20/per session

Activity/Program/Policy Materials & Resources OwnerTime frame

Evaluate P I EEst. Hrs.

Budget

Provide health tracking deviceOnline, sign-up, Order devices,

setup online platformJohn TBD

Participation / Sat.

Surveys  ✔ ✔   $40/ea.

Low

Mod

erat

eH

igh

Step-7: Calendar of Events

Step-8: Budget

Step-9: Communication Plan

Members to Include Activity Communication Strategy Resources Needed Assigned to:

Date to Launch

Internal Office Staff

HRA Launch

Emails via Mailchimp, dept., meetings, posters on

Wellness Wall

HTML email template, posters

from vendor, talking points for

managers

Nancy 10/1/13

Remote Office Email, conference callConference line

and email templates

Nancy 9/28/13

DriversHandouts in vehicle, text

messaging, posters on lockers.

Materials printed Bill 9/25/13

Production (ESL) Posters in lunch room, payroll stuffers

Translate Promotional

MaterialJohn 10/1/13

Spouses Not participating

Step-10: Evaluation Plan

Method or Type Description

Program ParticipationTrack all program participation by sign-in rosters and/or online sign-up surveys. The survey tool also tracks non-participants for further outreach.

Program SurveysOnline surveys are sent to every activity participant for reporting purposes, employee comments and suggestions are used to improve future initiatives.

Online Health TrackersEmployees will have the opportunity to track various health metrics via a HIPAA compliant health portal.

Online QuizzesHealth promotion challenges may consist of quizzes to establish a knowledge baseline to further adjust programming.

Online PollsOnline polls are an easy to way to quickly identify employee interest or stats on a specific topic, which can be emailed out or posted on website to show instant results.

Health Coaching Report Health coaching reports illustrate total sessions and session types.

HRA Summary ReportAnnual summary report of employee health risks are used for baseline analysis and year-to-year comparison.

Wellness Program Awards

Healthiest Employers of Oregon (HEO) and the American Heart Association’s “Fit Friendly Company,” are rewards that provide recognition to companies that achieve certain levels of wellness programming.

Wellness Program Scorecards

A subjective look at your wellness program that covers an array of program components. A side-by-side comparison from year-to-year can help push efforts forward and show opportunities for improvement or enhancement.

Culture of Health

Culture

HealthierPeople

ProductiveEmployees

Gains for TheOrganization

1. Health Status 2. Life Expectancy 3. Disease Care Costs 4. Health Care Costs5. Productivity

a. Absence b. Disability c. Workers Comp. d. Presenteeism e. Quality Measure

6. Retention 7. Company Visibility8. Social Responsibility

Leadership Vision Environmental SupportBenefits & PoliciesIndividual Strategies Population Strategies Incentives Measurement

Integrating Health Status into the Culture of the Company reduces barriers,

activates engagement and sustains healthy behaviors.

Incentives

No Incentives 2% - 10%Passive Incentive 15% - 25%

Small item incentive 20% - 35%

Cash incentive 20% - 40%

Benefit plan improvement 30% - 60%

Benefit plan plus cost reduction 50% - 70%

Combination of benefits and cash 75% - 100%

*Dee W. Edington, PhD, Zero Trends

Devices & Gamification

Wellness Awards

Learning Points

3. “Total Population Management” is the effective healthcare strategy and to capture the “Total Value of Health”

2. Refocus the definition of health from “Absence of Disease to High Level Vitality.”

4. The business case for Health Management indicates that the critical strategy is to “Keep the Healthy People Healthy” (“keep the low-risk people low-risk”).

5. The first step is, “Don’t Get Worse,”then develop a long-term strategy to embed wellness into your company culture

1. The “Do Nothing” strategy is unsustainable.