MERCER - co.washington.or.us

MERCER Consulting. Outsourcing. Investments.

1--::]- MARSH MERCER KROLL~ GUY CARPENTER OLIVERWYMAN

www.mercer.com

II Table of contents

Section I

Section II

Why Wellness, Prevention and Disease Management?

Wellness Services

Return on InvestmentSection III

Section IV Designing an Effective Program

Incentives

Disease Management

Section V

Section VI

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. II Why organizations engage in wellness

. It's the right thing to do

. Improve recruitment

. Create a culture of health

. Reduce Workers' Compensation costs

. Reduce lost work time

. Improve productivity

. Reduce health care costs

. Be an employer of choice

. Minimize turnover/Improve retention

. Improve morale

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'II Lifestyle behaviorsSnapshot of American lifestyles

. Smoking- 23% of the adult population use tobacco- Add another $40 to health care cost for every pack of cigarettes

. Physical Activity- Only 20%-25% of adults get 30 minutes of physical activity on most

days (attributed to lower health risks and prevalence of chronic disease)- 15% of all of the health care costs we pay in the US are due to

sedentary lifestyles. Obesity

- About 67% of the population is either obese or overweight- About 12% of total health care costs are obesity related- For an employer, it costs $1,200 more to treat the obese person than it

does the person who maintains a healthy weight. Nutrition

- Out of the top 10 causes of deaths in the US, diet is directly related tothe top three - heart disease, cancer and stroke, not to mentiondiabetes. These four make up 70% of total deaths.

Source: Matria's Business Case for Health and Productivity

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II Combined health risk, costs and savingsSnapshot of American lifestyles

. Physical inactivity and obesity, could cost an employer as much as 27% oftheir total health care claims

- Not eating a heart healthy diet causes a rise of 35%-40% of total healthcare costs

- Adding tobacco use increases to 65%-70% of total health careexpenditures within your organization

. If an employer dropped the number of physical inactive employees from78% to 75%

- Based on Dee Edington's data, the employer will save $1 ,500-$3,500for each person that reduces one of their risk factors

- With 100 employees, a three percent increase in physical activity, on amonetary dollar-for-dollar basis, you would see a $9,000 reduction inexcessive claims for that one change.

Source: Matria's Business Case for Health and Productivity

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II Continuation of care managementMaintaining, improving and managing population healthFirst step: understanding the "make-up" of your group

ChronicConditions

CatastrophicConditionst~

Acute Conditions

Programs: Nurseline,self-care skills,on-line resource, safety

Chronic DiseaseManagement

Patient Identificationand enrollment

Care Coordination

Stress/Mental Health

ManagementPractice Guidelines

Address ComorbidConditions

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III Continuation of care ManagementMaintaining,improving and managing populationhealth

This group should be yourt? target with wellness strategies!

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Health Promotion

I ~w.reness I

[s~eningS J

ImmUhizations

Healthy LifestylePrQmotion

ChronicConditions

At Risk CatastrophicConditions

III

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:.

.- .

.~Acute Conditions

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Health RiskManagement

Health RiskAssessment

Patient Identificationand enrollment Navigational Support

Targeted BehaviorModification

Care Coordination Patient Advocacy

Stress/Mental Health

ManagementPractice Guidelines Care Coordination

Health Campaigns Address ComorbidConditions

Address ComorbidConditions

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II Wellness as a solution

Any "wellness program"should supportthese initiatives

. Promote an individualawareness ofpersonal health risks and conditions

. Stress prevention and early detection r:-fl1)} r

,...Q,

»" ,.' r

"- J l~rJ

. Focus on the appropriate populations

. Be a key component of a total caremanagement strategy

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II Six reasons why health promotion makes good sense

. Although we spend more dollars on health care than any otherindustrialized nation, our citizens are not the world's healthiest.

. Much of the illness in the US is preventable.

. health care costs are an issue of significant concern.

. The worksite is an ideal setting to address health and well-being.

. Recent research validates that health promotion programs canimprove health, save money and even produce return on investment.

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Typical medical plan

~ of Population. Use of Health Care $5 I

70%

0%

37%

60%

50%

400/0

30%

20%

100/0

Well Acute Chronic

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II The problemNeed to act now

. Costs are still rising, even with managed care and cost shifting

. Aging workforce - each year a person ages adds 2.5%-3.0% inmedical costs, while also driving disability incidence

. Pressures to control cost and enhance productivity are increasinglyimportant factors in both public and private sectors

. Increasing lifestyle and psychosocial driven health costs (e.g., obesity,stress, risk behaviors)

. Piecemeal solutions generally just shift costs, promote narrowexpense control

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The problemNeed to act now (continued)

. People with chronic diseases often account for 500/0 of costs - 70million people have a chronic disease

. In most employer groups- 20°10of the members incur 80°10of the health care costs

- 3°1oto 5°1oof the members are responsible for 50°10to 60°10of thecosts

- Those with risk factors, (e.g., smoking, obesity, inactivity) can cost10°10 to 70°10 more than those not at risk

. To make matters worse

- On average,50°10 of people with a chronic disease do not complywith their treatment plan resulting in disease progression andincreased use of health care resources

- Poor compliance with prescribed medical treatment is estimated tocost between $100 billion and $150 billion annually in the US


III Demand: what drives health care resource consumption?

50%

40%

30%

20%

10%

Determinants

0%

Source: IFTF, Center for Disease Control and Prevention

AccesstoCare

10%

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Genetics Environment Behavior

20% 20% 50%

: II "Wellness" - what is it?

. "Wellness"means differentthings to differentorganizations anddifferentpeople!

. Nike's "wellness"program is going to be differentthan a typical Countyprogram.

. The definition of "wellness" to someone who is physically active isdifferent than someone who has a more sedentary lifestyle.

. A good "wellness program" should encourage individuals to engage inbetter habits or maintain already good habits. The goal shouldn't be tomake a "couch potato" a marathon runner.

. Wellness is an attitude as well as a set of actions.

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i II Wellness servicesi Components of typical wellness programs

. Health risk assessments (HRAs)- Comprehensive questionnaire completed by the member which

provides individualized feedback to the member and aggregatefeedback to the employer about the most pressing health issues.

. Wellness health coaching/counselors- Health professionals provide one on one counseling, assist with the

development of a personalized wellness plans, and providesuggestions for appropriate referrals to a wide range of preventivehealth services.

. Health screenings/lab tests- Screenings provide early detection of conditions such as breast, colon,

skin and prostate cancer, high blood pressure, diabetes, andosteoporosis.

. Health fairs

- Effective way to provide valuable health information to a large numberof employees in a convenient one stop shop format. Fairs may includeexhibits, mini workshops, demonstrations, screenings and more.


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II Wellness servicesComponents of typical wellness programs (continued)

. Health education seminars

- Onsite educational lectures that are made available to employeesduring work time (i.e., lunchtime lectures)

. Self-care employee wellness books/kits

- Typically kits are mailed to employees' homes and provide valuableand accessible health information that can be reviewed by theentire family

. On-line resource libraries

- Resource libraries may include health articles, drug interactiontools, procedure/treatment comparison tools and more

. Alternative care discounts

- Employees receive discounts at chiropractors, massage therapists,acupuncturists, etc. who are contracted within the vendor's network

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Wellness servicesComponents of typical wellness programs (continued)

. Fitness programs

- Discount programs that allow employees to exercise at their ownlevel and track individual progress

. Smoking cessation programs

- Assistance programs that help employees avoid the many pitfallsinvolved when trying to quit smoking

. Ergonomic assessments

- Assessments identify and analyze the physical demands requiredto perform a job and determine the risk factors or hazards that havepotential to cause an injury to an employee performing the job

. Maternity care programs

- Pre and postnatal care is provided through both nurse casemanagers as well as educational books and other resources

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Return per dollar invested for seven well known companies whoimplemented wellness programs

$7.00

$6.00

$5.00

$4.00

$3.00

$2.00

$1.00

$0.00UnumLife PepsiCo Motorola GeneralMills Equitable

LifeKennecott Coors

1992, IRSA, the Association of QualityClubs


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i II Initial considerations

. Nature of your workforce:

- Stability (turnover)

- Health status (use experience and utilizationdata)- Employee location (centralized, widespread)- White collar/blue collar/combination

. Resources- Financial

- Internal staff availability

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Seven steps to drive the process of building a wellness program

. Capturing senior level support (Board of Commissioners, etc.)

. Creating a cohesive wellness team (include employee associationsearly in the process so they have "ownership")

. Collecting data to drive health efforts

. Crafting an operating plan

. Choosing appropriate interventions

. Creating a supportive environment

. Consistently evaluating outcomes

Wellness Councils of America

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Improving health - a three year plan

. Year one - set the stage- Health risk assessment

- Screenings

- Target top 10% with individualized counseling

- Target next 20% with educational mailings

. Year two - building healthy lifestyle changes

- Screenings

- Health and fitness activities (walking programs)

- Theme based quarterly activities (stress management, self-care,nutrition, etc.)

- Continuation of high risk intervention

. Year three - maintaining healthy momentum- Follow-up health risk assessment- Continuation of activities outlined above

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Adopted from BCBS of MA

Estimated percent of employees at riskIn a manufacturingand a financial services company

Manufacturing Financial ServicesCommon Risks Company CompanyAlcohol 4.7% 2.00/0

Blood pressure 36.00/0 21.7%Body weight (BMI) 52.9% 34.3%Cholesterol, total 17.6% 13.6%Cholesterol, HDL 19.9% 6.2%Illness days 12.20/0 11.3%Life satisfaction 14.8% 21.80/0

Major diseases 14.1% 5.8%

Perception of health 11.8% 12.60/0

Physical activity 16.50/0 24.60/0Smokers, current 17.3% 12.1 %Smokers, former 33.5% 23.1 %Safety belt 11.3% 11.8%Stress 23.4% 32.6%

Risk LevelsLow risk (0-2)Medium risk (3-4)High risk (>4)

58.1%27.6%14.1%

59.7%26.6%13.7%

Dee Edington, University of Michigan Health Management Resource center-Mercer g:\wp\group\2009\wash33\presentation\wellness strategies- 2.ppt

'. / "

Estimated percent of employees with a diseaseIn a manufacturing and a financial services company

Common Manufacturing Financial ServicesMedical Problems Company CompanyHeart problems 6.20/0 2.2°/0Diabetes 6.0°/0 1.70/0

Emphysema/bronchitis 2.2°/0 1.40/0Back pain 37.8°/0 30.90/0Asthma 4.90/0 7.7°/0

Seasonal allergies 28.3°/0 36.1 %Cancer 1.1 % 0.8°10

History of stroke 0.7°10 0.1%Arthritis 21.80/0 9.1 %

Dee Edington, Universityof MichiganHealth Management Resource Center

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How ready are employees to make change?(Tran theoreticalmodeland stages of change)

Developed by Dr. James O. Prochaska, University of Rhode Island

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. II Effective wellness programs for all stages

. Less than 20% of the population with health risks is in the action stage.Yet 90% of health promotion programs are developed with that 20% inmind. HealthPromotionPractice,July 2002

. A successful wellness strategy will offer programs that impact peopleat all levels and guide employees though the various stages in themodel.

. Make sure to select a Health Risk Assessment that evaluates thestages of change and your employees' readiness to change.

. Make certain that a budget is allocated to cover all areas of a wellnessprogram.


<1

Calendar of health awareness activities

. January

- Memo from management

- Website registration campaign (Carrier mailing. Raffle of registrantsto win prizes worth $500.)

. February- Health risk assessment campaign (Utilize carrier HRA tool. Raffle of

participants to win prizes worth $2,000. All participants receive $5per month credit on medical plan payroll deduction - $9,000, 30%participation, $60 per year)

. March

- Health fair ($8,000)

0 Cholesterol screening (40% participation, $25 per test)0 Blood pressure screening (50% participation, $4 per test)0 Body fat test (30% participation, $12 per test)


'-, '

II Calendar of health awareness activities

. April

- EAP - Brown bag lunch. Mental health/substance abuse (Free -EAP vendor)

- Massage therapist visits (Free - medical carrier)

. May

- Walk for wellness (three month program which provides smallrewards for mileage walked. T-shirts, water bottles, hats. 300participants, $3,000)

. June

- Email: Healthy backs (Free)

- Workplace ergonomic assessments (Free - Workers'Compensation carrier)

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. July- Email: skin cancer prevention(Free)

- Skin cancer screening($2,700. 30% participation,$18 per test)

. August- Email:reminderof on-linehealthresources,gym/WeightWatchers

discounts(Free)

. September

- Email:Allergies (Free)


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. October

- Breast cancer awareness month (Free. UtilizeAmerican CancerSociety materials.)

. November

- Flushot clinic ($5,250. 70% participation, $15 per test)

- Email: Avoiding holiday weight gain (Free)

. December

- Eating healthy (Free - EAP vendor)

- Email: Prevention/treatment of heartburn and acid reflux (Free)

Total wellness and prevention expense:$25,200, $4.20 per employee per month

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II Incentive impactIncentives drive participation

. How many people need to be engaged, at what intensity, tocreate the desired impact?

- Within first year, 35-50% of population should be engaged atsome level

- Within first two years, 45-60% should be engaged

- Within first three years, 60-75% should be engaged

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Ideas for incentivesIncentivesdon't have to be cost prohibitive

. Monetary rewards*

- Offeran employee$25 forcompletinga wellnessprogram.

. Insurancepremium discounts

- Offer reductions in monthly contributions for participating inwellness initiatives.

. Gift certificates*

- Hand out gift certificatesfor fitnessstores or local restaurantsasdoor prizes to employees who participatein a health fair.

* Must include as taxable income.

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Ideas for incentivesIncentivesdon't have to be cost prohibitive(continued)

. Hold a raffle

- Holda drawingfor movietickets,sportingevents,or otherlocalentertainmentat the completionof a wellness seminar.

. District customized incentives

- Offer incentivessuch as a canvas bag with the districtlogo to eachemployee that reaches his or her goal.

. Achievement awards

- Provide employees with a certificate of completion congratulatingthe employee for achieving a health related goal.

. Wall of fame/local media attention

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Ideas for incentivesIncentives don't have to be cost prohibitive (continued)

. Donation to a charity organization in that person's name

. Contribution to a FSA or HSA

. Special parking space or other recognition

. Health club subsidy or payment

. Two-part incentives

- Offer part of the incentive to the employee for signing up toparticipate in a program and offer the other part of the incentivewhen he or she completes the program.

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III Disease management process

. Identification - The carrier identifies members to participate in thedisease management programs.

. Assessment - Members are referred to case managers who determinethe appropriate level of intervention and care.

. Intervention - The case manager will contact the member via mailingor phone. The level of intervention is based on the risk stratificationlevel of the member (high, moderate or low).- Educational reminders

- Nurse/case manager mediated phone calls

- Assistance with self care, monitoring medications, accessing theappropriate services, treatment plan compliance, obtaining thenecessary equipment or supplies, etc.

- Member newsletters

- Work books for monitoring progress and treatment regiments

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II Action stepsI Disease management

. Determine your current carriers capabilities

- Types of programs

- Depth of programs- How members are identifiedand contacted

. Determine how many of your employees and dependents currentlyparticipate in programs

. Develop a strategyto communicateand promotediseasemanagement programs

. Hold your carrier accountable for increasing participation in diseasemanagement programs

. Identify additional community based resources and communicate toemployees and dependents

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Action stepsDisease management (continued)

. We will talk in more depth about disease management programs andstrategies at our "Controlling Health Care Costs" discussion on Fridaymorning!

We hope this information has been helpful and encourage you toembrace a culture of wellness!


II Questions?

. Mercer Health & Benefits

- Renee Balsiger, Principal503 273 2802

- Mike Berry,Principal503 273 2820

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