With Brad Cooper, CEO US Corporate Wellness, Inc..

With Brad Cooper, CEO

US Corporate Wellness, Inc.

Effective Employee Wellness

and Insurance?

Effective Employee Wellness

and Insurance? Helps keep claims costs under control Enhances value of other benefits and insurance-

based programming already in place (if done well) Offers some good news that can be shared with

clients (& employees) during annual meetings Provides additional revenue stream and/or

additional value proposition for you/your firm (and another reason to reach out to clients/potential clients)

Low maintenance, high value for HR and/or Benefits Team and you

Helps keep claims costs under control Enhances value of other benefits and insurance-

based programming already in place (if done well) Offers some good news that can be shared with

clients (& employees) during annual meetings Provides additional revenue stream and/or

additional value proposition for you/your firm (and another reason to reach out to clients/potential clients)

Low maintenance, high value for HR and/or Benefits Team and you

The Problems…

Health Care Costs Rising 8-14% Annually Disability costs are directly correlated to BMI levels (2-7x’s

normal) Sick Time Costs Employers $602/employee/year

One out of two adults will be diagnosed with a chronic disease

Over 2/3rds of Americans are overweight/obese, with prevalence in new hires under the age of 40 actually higher

than in those over 40 Smokers cost employers up to $5,600 additional/year

Health care claims for employees who don’t exercise were $350/year higher than those who exercised just 1-2 days/week

Direct health care costs are only part of the picture. Health related productivity costs are estimated to be equal to 3-4x’s

direct costs.

Obesity Trends* Among U.S. Adults1994


(*BMI ≥30, or ~ 30 lbs. overweight for 5’ 4” person)

<10% 10%–14 15%–19%

Source – CDC Behavioral Risk Factor Surveillance System




<10% 10%–14% 15%–19%





<10% 10%–14% 15%–19% ≥20%





<10% 10%–14% 15%–19% 20%–24% ≥25%





<10% 10%–14% 15%–19% 20%–24% 25%–29% ≥30%


Source – Archives of Internal Medicing (Duke University – 11,700 people in sample size)

How about Disability Costs?


Exclude “Severely Obese” and examine data…


One more step (“overweight” category only)

Source – American Institute for Preventive Medicine, 2009

If food prices rose at same rate as medical costs since the 1930’s…

Dozen Eggs would now cost $85.08 One Pound of Apples … $12.97 One Pound of Sugar… $14.53

A Roll of Toilet Paper… $25.67 One Pound of Butter… $108.29 One Pound of Coffee… $68.08 One Pound of Bacon… $129.94

Health Care Inflation?

Wellness Initiative Plans for the Remainder of 2009

*Health Care Plans – Impact of Financial CrisisInternational Foundation of Employee Benefit Plans, 2009

Wellness 1.0 … Group Activities

Wellness 2.0… Disease Management

Wellness 3.0… Web Tools

Wellness 4.0… Generic Call Center Added

Wellness 5.0… Personalized Approach

A Little History Lesson

Outcomes:The Children’s Hospital of Denver*

Outcomes:The Children’s Hospital of Denver*

Pre- Wellness Program: Average annual increase in medical costs from 2002-2006 was 10.8%

Post-Wellness Program: Average annual increase in medical costs from 2007-2010 was 4.6%

Pre- Wellness Program: Average annual increase in medical costs from 2002-2006 was 10.8%

Post-Wellness Program: Average annual increase in medical costs from 2007-2010 was 4.6%

Medical plan trends have offset nearly $5 million in two years

*US News Best of Children’s Hospitals Honor Role

Beware the “Token” Wellness Effort

“If you look at people after coronary-artery bypass grafting two years later, ninety (90!) percent of them

have not changed their lifestyle.”-Alan DeutschmanChange or Die

(Note: Lifestyle changes don’t just happen because they’re “important.” Must involve pattern of Relate…

Repeat… Reframe)

1. “Most experts believed that effective coaching is essential to improving health behaviors.”

2. "Some employers focus coaching efforts solely on high-risk individuals, but there appears to be increasing recognition among employers of the importance of making health coaching available to a broader population.”

3. There is a great deal of variation between HRAs. However, the research was clear on this: "What most experts do agree on is that HRAs can be a valuable screening tool, but only if they are followed up by effective health coaching and wellness activities.”

4. "One-size-fits-all programs purchased off-the-shelf from health plans and wellness vendors are unlikely to make a significant impact. Least likely… are programs consisting only of online HRAs and Web-based educational tools, with no individualized follow-up activities to engage employees."

Let’s take a look at the literature…(Research brief from National Institute for Health Care Reform on Effectiveness of Employee Wellness Initiatives, 2010, covered by

the Wall Street Journal)

Where is your trend line heading?

Where is your trend line heading?

Total Health Care and Disability Costs = ______Annual Increase of 10% (?) = ______

What if that annual increase were diminished by 2%? 4%? 8%?

And then there’s productivity, retention, sick time, stress reduction…

When Comparing Programs…

Option 2 - $3.50 PEPM•1000 Employees

•Restricted Access to “bottom” 40%

•“Passive” Approach results in 10-15% Actual Utilization (or

less)•**40-60 Employees actively

engaged**

(Making comparable “cost” of #2 at least 5 times the

cost/employee of #1)

Option 1 - $7 PEPM•1000 Employees

•“Active” Approach produces 50% Participation (REAL

Participation)•**500-600 Employees actively

engaged**

Place in Life?

Goals?

Weight Focus?

History?

Temperament?

Activity Level?

(And what happens if it changes next

year?)

(Or – painting the stick orange)

Incentives*

• Usually (always) necessary in some format (varies by industry)• Research indicates $200-300/yr is effective in most organizations• Can be “cost neutral” (ie, balanced out by increase in deductible)• Tie to pursuit vs. achievement is recommended• Various forms available (note tax implications for each):

• Cash• Time Off• Drawing for prize (among participants)• Gift Certificates• Reduced Insurance Premium• Goodies (shirts, water bottles, exercise equipment…)• Health Saving Account tie-in

* Note - Laws vary by state – confirm legal issues with counsel

Only one in twenty adults consistently engage in the five most important health behaviors:

•Regular exercise

•Healthy levels and types of fat intake•Five daily servings of fruits and vegetables

•Moderate drinking•Non-smoking

Source – Institute for the Future, Center for Disease Control and Prevention; Midwest Business Group on Health; Annals of Internal Medicine, 2002

The Tipping

Point The Rule ofSeven

Costs for a sample organization…(based on 11,000 benefit eligible employees)

The above CDC Data includes only BMI-Related Medical and Work Loss Costs. How about Disability Costs?

Turnover?Inadequate Sleep?Poor Eating Habits?

Presenteeism/Lack of Energy?

Cigna, Women >49 Years old, Mammogram

45.50%

63.25%

45.28%

0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00%

Non Participants

Participants

Normative

Outcomes:Sample Client

Outcomes:Sample Client

Wellness program participants are more compliant with recommended preventative care

Wellness program participants are more compliant with recommended preventative care

Likelihood of EIB Claim at The Children’s HospitalLikelihood of EIB Claim

at The Children’s Hospital

Wellness Program

Participant

Non-Participant

Additional ROI Data for Sample Client

Additional ROI Data for Sample Client

The difference in total EIB hours was 2.85/employee, translating to over $185,000 (Estimated at double if sick

time separate)

10% improvement in BMI produced $100,000 in savings

8% increase in exercise levels correlated to $96,000 saved

7.7% in blood pressure translates to over $60,000 saved

Impact on Depression, Smoking and Immunizations produced an additional $240,000 in annual savings

Note that Edington assigns a value of $350/year/employee who has been kept from moving into higher risk category

The difference in total EIB hours was 2.85/employee, translating to over $185,000 (Estimated at double if sick

time separate)

10% improvement in BMI produced $100,000 in savings

8% increase in exercise levels correlated to $96,000 saved

7.7% in blood pressure translates to over $60,000 saved

Impact on Depression, Smoking and Immunizations produced an additional $240,000 in annual savings

Note that Edington assigns a value of $350/year/employee who has been kept from moving into higher risk category

Cutting through the Noise of Options…

Wellness Program Micro AuditWellness Program Micro Audit

1. Program is built around individual employee goals, created by each employee (vs. limited number of generic curriculum) ___

2. Employee engagement and satisfaction with the program are monitored and tracked regularly _____

3. Design of the program drives cultural changes across the entire organization _____

4. Time commitment required on part of the HR Professional or Wellness Champion within organization is < 2 hrs/month ____

5. Momentum is sustained throughout the year (rather than seasonal or launch-dependent) _____

1. Program is built around individual employee goals, created by each employee (vs. limited number of generic curriculum) ___

2. Employee engagement and satisfaction with the program are monitored and tracked regularly _____

3. Design of the program drives cultural changes across the entire organization _____

4. Time commitment required on part of the HR Professional or Wellness Champion within organization is < 2 hrs/month ____

5. Momentum is sustained throughout the year (rather than seasonal or launch-dependent) _____

6. Wellness Coaching offers a variety of options in terms of unique personalities, preferences, goals, etc _____

7. Employee participation expands (not shrinks) over time _____

8. The program adjusts with each employee as their wellness pursuits change or develop _____

9. If employees are not initiating activity, the program regularly provides process to re-engage with them _____

10. You personally enjoy participating in the program _____

6. Wellness Coaching offers a variety of options in terms of unique personalities, preferences, goals, etc _____

7. Employee participation expands (not shrinks) over time _____

8. The program adjusts with each employee as their wellness pursuits change or develop _____

9. If employees are not initiating activity, the program regularly provides process to re-engage with them _____

10. You personally enjoy participating in the program _____

Wellness Program Micro Audit (cont.)Wellness Program Micro Audit (cont.)

Benefits Broker Micro-AuditBenefits Broker Micro-Audit

1. Which of your clients are seeing escalating health care and/or disability costs?

2. Which of these clients want to do something meaningful and ROI-based to change the trend?

3. Are generic options making a difference for these clients?

4. Would it be beneficial to have a new value proposition to bring to your clients?

5. Do the wellness programs being provided make YOU look good?

1. Which of your clients are seeing escalating health care and/or disability costs?

2. Which of these clients want to do something meaningful and ROI-based to change the trend?

3. Are generic options making a difference for these clients?

4. Would it be beneficial to have a new value proposition to bring to your clients?

5. Do the wellness programs being provided make YOU look good?

Thank You!Thank You!

For more information specific to your organization, please contact Brad directly at

[email protected] or 303-521-1570

Or, visit

www.USCorporateWellness.com

With Brad Cooper, CEO US Corporate Wellness, Inc..

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