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THE C ASE FOR HEALTH PROMOTION PROGRAMS AN E M P L O Y E R W H I T E P AP E R PRESENTED BY 780 Township Line Road Yardley, PA 19067 800-524-1176 www.healthink.com Executive Summary Health promotion is an investment in human Link between health risks and medical capital and productivity. Employees in care costs: Being at high risk for any single optimal physical and psychological health health condition is associated with higher are more likely to be on the job and medical costs. Those with multiple risk performing well. They also are more likely factors cost even more. to be attracted to, remain with and value a Changes in risk result in changes in costs: company that obviously values them. The cost increases associated with increased Health and productivity management is risk are greater than the declines associated based on the concept that an “at risk” with decreased risk. workforce is a business liability with direct Which employees should be targeted? and hidden costs impacting productivity. Many health promotion programs focus on Thus, an essential component of high-risk individuals, while others focus on productivity management is managing both high- and lower-risk employees. Some employee health. research indicates an effective strategy is to focus on keeping healthy people healthy by Dramatic ROI preventing those in low-risk categories from Health promotion programs are a proven moving to medium- or high-risk status. method for employers to help employees Impact on health care costs: A manage their health. Multiple peer-reviewed comprehensive review of 72 studies last studies have concluded that businesses can year concluded that overall, health realize from $3 to $8 for every dollar spent promotion programs result in lower health on health promotion. These savings care costs and are considered a viable and represent both direct costs — reductions in effective method for helping employers medical costs and claims — and indirect reduce employee-related expenses. savings in reduced absenteeism and disability and increased productivity. Many Impacts on productivity: In addition to researchers believe the indirect, higher health care costs, negative impacts productivity-related savings are double the on productivity are a major, costly product more easily measured direct health care of poor health. Some researchers believe costs. productivity losses exceed actual health care Beyond ROI considerations, health costs. promotion programs also are ideal for raising health awareness and getting Worksite health promotion programs can employees to be active partners in their own improve productivity by attracting health. superlative workers, reducing absenteeism and lost time, improving time utilization and Research Conclusions Regarding employee morale, building goodwill toward Health Promotion Programs management and reducing employee Impact on health risks: Numerous turnover. studies have demonstrated that well- Absenteeism: A common yardstick to conceived health promotion programs measure productivity and absenteeism can help workers reduce their health includes missing time from work, such as risks. personal illness days, as well as short- and long-term disability and worker's compensation days. Health risks bear the HEALTH INK & VITALITY COMMUNICATIONS 2 same relationship to days absent as they Match health promotion initiatives with do to health care costs: the greater the health indicator issues. health risks, the higher the absenteeism Utilize periodic health-risk assessment and rates. Conversely, health promotion screening programs. programs have been shown to Systematically funnel workers identified as significantly reduce absenteeism. being at higher risk into appropriate follow- Presenteeism: This relatively new up programs. concept considers the impact of workers Measure and evaluate. who are present but not fully productive. On-the-job workers with Depending on how comprehensive the plan, higher health risks have more there is a wide cost range associated with health productivity loss, and presenteeism is promotion programs. Some companies begin the major contributor to these with relatively simple and inexpensive productivity losses. Researchers who initiatives, such as distributing a wellness studied one firm's call center operators newsletter, which can be an effective way for a were startled by the type of conditions company to reach all of its employees and their that contributed most to presenteeism. dependents with proactive health messages. Lower cost, chronic conditions such as More comprehensive health promotion allergies, asthma, digestive disorders, programs can range from less than $50 to over back pain and mental health problems $400 per employee — a fraction of the $4,000 were found to have a greater negative to $5,000 per year the average employer spends impact on productivity than did high to ensure productivity through health benefits, health care cost conditions, such as which continue to experience annual double- cardiovascular disease, diabetes and digit increases. Factoring in productivity losses cancer. due to health, these expenses could amount to Instituting a Health Promotion $10,000 or more per employee per year. Program Conclusion Experts suggest certain elements are As a means to reduce employees’ health risks, necessary for a successful health promotion program. These include: curb health care costs and improve employee well-being, morale and productivity, health Determine your company's chief promotion programs are a significant, viable and organizational health indicator issues. cost-effective tool in employers' health care strategies. HEALTH INK & VITALITY COMMUNICATIONS 3 Introduction From a business perspective, health medical shows like ER for years, there is no TV promotion is an investment in human show about public health. capital. “It’s not as exciting, not as sexy as the “Employees are more likely to be on the immediate attention you get for saving a job and performing well when they are in person’s life, finding a cure or treating a serious optimal physical and psychological health,” disease,” says Ron Z. Goetzel, Ph.D., vice the Partnership for Prevention, a nonprofit president of consulting and applied research for association of corporations, nonprofits and the MEDSTAT Group in Washington, D.C. state health departments, contends in “But the reality is that the mundane, boring, Healthy Workforce 2010: An Essential common-sense things your mother told you to Health Promotion Sourcebook for do 50 years ago — exercise, eat properly, don’t Employers, Large and Small. “They are also smoke, and balance your work, family and more likely to be attracted to, remain with social life — actually make a big difference in and value a company that obviously values your health and well-being.” All of which, in them. In short, a company’s productivity one way or another, health promotion programs depends on its employees’ health.”1 address. Top Reasons for Programs What About Results? According to the 1999 National Worksite Intuitively this all makes sense. But it has Health Promotion Survey, the top reasons long been thought difficult, if not impossible, to employers launch health promotion quantify the financial benefits of health programs are to improve employee morale, promotion programs. What is the return on retain good workers, attract good employees investment, the ROI, of health promotion? and improve productivity — all of which While that may once have been hard to quantify, worksite health promotion programs target.2 and to quantify in dollars and cents, a growing Such programs can be particularly body of peer-reviewed studies has concluded effective because, with a captive work force, there is an ROI, often dramatic, for employer- companies are dealing with employees who based health and wellness promotion programs. experience a consistent environment and Multiple studies have shown that businesses can social and organizational support. Worksite realize from $3 to $8 in savings for every dollar health programs also have one other spent on health promotion. These savings powerful feature workers find attractive: represent both direct costs — reductions in Employers, not the employees, pay for them. medical costs and claims — and indirect savings As the Partnership for Prevention notes, in reduced absenteeism and disability and the field has even spawned new business increased productivity. In fact, some researchers management concepts. Health and believe the indirect, productivity-related savings productivity management is based on the are double the more easily measured direct concept that an “at risk” workforce is a health care costs.3 business liability with direct and hidden “The data supporting the claim that health costs impacting productivity. Thus, an promotion programs can reduce medical care essential component of productivity costs and reduce absenteeism is of higher management is managing employee health. quality than the data most businesses have to Nonetheless, health promotion and support other investments of similar cost,” disease prevention have an image problem. writes Michael O’Donnell, editor in chief and While America has watched highly rated president of the American Journal of Health Promotion.4 HEALTH INK & VITALITY COMMUNICATIONS 4 Joseph A. Leutzinger, Ph.D., director of most software or databases don’t have it. We health promotion at Union Pacific Railroad, also don’t look for ROI for medical and surgical agrees. “Most business leaders make a lot procedures.” more important decisions related to But beyond the measurable ROI financial monetary expenditures based on less data numbers, health promotion programs are an than they do for spending of health ideal vehicle to enable and encourage promotion programs,” he says. While he is employees to be active partners in their own an advocate of health promotion program health — a goal of all employers. evaluation and has conducted some Workplace health promotion, Leutzinger impressive evaluations himself, Leutzinger concludes, is simply common sense. “If you is somewhat mystified by constant demands look at what’s happening in business trends, in to justify health promotion expenditures. the coming years it’s going to be important for “Most companies spend on health employees to have a certain core set of skills to promotion what they spend on carpets and make a company profitable. It becomes pretty one-day company events,” he says. “Do we intuitive that if the bar is going to be raised on cost-justify all training programs, business what’s required, if employees are not healthy or equipment and all other discretionary are dealing with health issues, obviously they spending at the same intensity and rigor that are not going to be able to perform at this is required for health promotion? Typically, expected and projected higher level.” companies say everything has an ROI, but HEALTH INK & VITALITY COMMUNICATIONS 5 The Most Influential Studies on the Financial Impact of Health Promotion As we have said, a growing body of peer- costs. They were followed by high blood reviewed studies has demonstrated the glucose levels (35 percent more), obesity financial impact of health promotion. Here (21 percent more), tobacco use (former are the dozen adjudged the most influential smokers 20 percent more, current smokers by an expert panel and summarized in a 15 percent more), high blood pressure (12 May/June 2001 American Journal of Health percent more) and poor exercise habits (10 Promotion paper by Thomas Golaszewski, percent more).5 “We thought obesity or Ed.D., of the State University of New York– smoking would be the most costly,” says Brockport: Bill Witmer, the HERO president. “The HERO Studies: In 1996 the Health study’s conclusion, though, was that the Enhancement Research Organization depression psychosocial diseases such as Impact on Individual Health Care Costs: (HERO) was created after organizers High versus and stress are by far the most costly of the Lower-Risk Employees 100% realized data existed to create a large, typical controllable risk factors. That’s Individuals at high risk for 75% 70.2% depression have 70.2% retrospective, multi-employer health important because, in some cases, those at higher costs than lower risk employers don’t even provide coverage for promotion research database. HERO 50% 46.3% Percent brought together the StayWell a lot mental health. It got 34.8% of employers Company, which had a large database of thinking that they should start paying more 25% 21.4% 19.7% 14.5% 11.7% 10.4% health-risk assessments (HRAs), and the attention to depression and stress.” 0% MEDSTAT Group, which had a large Stress Glucose Weight Exercise Tobacco Pressure Tobacco- Depression Blood database of medical claims. The two Past -25% companies were able to merge the health-risk assessments and medical -50% claims data of 47,500 employees of six large employers: Chevron Corporation, Health Trust, Hoffman La Roche, Marriott and the states of Michigan and Tennessee. All of the employees were enrolled in their employers’ fee-for- service, self-insured health plans between 1990 and 1996 and had completed one or more health-risk Source: Goetzel et al. (1998) assessments. Witmer notes that only 2.2 percent of the The first HERO study evaluated 10 workers assessed admitted to the costliest risk factors, six self-reported and four risk factor, depression, even though research biometric measurements (cholesterol, indicates about 10 percent of the U.S. blood pressure, blood glucose and population at any given time is clinically weight). Participants were followed for depressed. up to three years after completing their first HRA, following which data showed Another HERO study used the same data that those with self-reported, persistent and subject group to explore the relationship depression had adjusted annual health between modifiable health risk and health care expenditures that were 70 percent care expenditures. Employees with greater than those who didn’t report modifiable health risks were responsible for being depressed. Highly stressed 25 percent of total expenditures. Those individuals incurred 46 percent greater employees who reported being under HEALTH INK & VITALITY COMMUNICATIONS 6 constant stress with no methods for to go from high to low risk cost an average coping were responsible for 7.9 percent of $129 less per year; those that moved from of total health care costs; former low risk to high risk cost $734 more per smokers, 5.6 percent; overweight, 3.3 year. Since then, ongoing studies by the percent; current smokers, 2.5 percent; university’s Health Management Research high blood glucose, 1.7 percent; Center have continued to show positive persistent depression, 1.5 percent; and results. high blood pressure, 0.5 percent. Johnson & Johnson Study: Between 1979 and 1983 Johnson & Johnson divided more “That 7.9 percent is enormous,” says than 11,000 employees at different work Witmer. “It resulted in the Harvard locations in 18 states into three groups to Business Review doing a series of judge the value of interventions such as studies that concluded today’s health screenings, introductory lifestyle workplace is the most chaotic in history. seminars, lifestyle improvement programs Mergers, acquisitions, downsizing and such as smoking cessation and stress the taking away of retirement plans management, and work environment almost overnight has created changes, such as healthier cafeteria foods unprecedented chaos, and there’s no and exercise facilities. One group was question that’s going to generate stress exposed to such interventions early, another and anxiety and take away from work group received delayed intervention and the performance.” third group received none. Analysis of HealthPartners Study: This HMO medical care and utilization data indicate based in Minneapolis studied 5,689 of the groups that received interventions its members who were over 40 and had experienced lower rates of increases for one or more chronic conditions to health care costs, hospital admissions and determine the relationship between hospital days. J&J saved $980,316 (in 1979 modifiable health risks and health care dollars), or $116 per subject over the four costs. Over an 18-month period: health years. care costs decreased from the median by DuPont Study: DuPont gauged the 4.7 percent for every day of the week effectiveness of comprehensive worksite subjects exercised; costs increased 1.9 health promotion on days lost to disability percent above the median for every during the 1980s. Comparing more than increment in Body Mass Index; and for 29,000 hourly workers from 41 intervention current and former smokers, there were sites to more than 14,000 from increases of 18 percent and 25 percent, nonintervention control sites, DuPont respectively, over nonsmokers. concluded the interventions significantly cut Steelcase Study: University of disability days by .4 days per employee over Michigan researchers followed 796 two years. That saved 11,726 disability days employees at this office furniture maker and resulted in a savings of $1.42 for every who completed health-risk assessments dollar invested. before and after the 1985–1990 study Birmingham, Ala. Study: The city period. Based on 10 lifestyle and implemented a comprehensive health biomedical risk factors, such as blood intervention program in 1985. Its elements pressure and cholesterol levels, the included health promotion, such as workers were classified as either high or mandatory HRAs, referrals for high-risk low risk (two or fewer risk factors) individuals, a shift to managed care and during each of two periods: 1985–1987 other medical plan redesigns. Between 1985 and 1988–1990. High-risk workers had and 1990 the average employee medical high health costs. Those that managed expenses were virtually unchanged (while HEALTH INK & VITALITY COMMUNICATIONS 7 Alabama state employees’ health care Travelers Study: In 1986 the insurer costs mushroomed 82 percent). During introduced a health promotion program that that same period, both hospital focused on both lifestyle and medical self- admissions (-55 percent) and hospital care interventions to all 36,000 of its days (-38 percent) declined employees and retirees. The program significantly. featured multiple communications vehicles, Citibank Study: In 1994 the financial including newsletters, brochures, videos and corporation launched a mass a self-care reference book, committees and communication health promotion social events such as health fairs and intervention to all of its employees. It contests, and a large fitness facility at the included a health-risk assessment; corporate headquarters in Hartford, Conn. A targeted educational programming, total cost-to-benefit analysis was completed including print material, telephone for 1986 to 1990 and projected to the year counseling and telephone-accessed 2000. Researchers estimated the cost-benefit audio material, for those identified as ratio at $3.4 for every dollar spent, a high risk. There also were follow-up cumulative gain of $146 million by 2000.6 letters and telephone information access for lower-risk employees, and follow-up HRAs, reports and self-care books for everyone. Comparing more than 11,000 participants with more than 11,000 non- participants, researchers concluded that health care expenditures ultimately increased just 25 percent for participants but 43 percent for non- participants, a difference of $34.03 per person per month. Overall total savings were estimated at between $6.6 million and $7 million, with a return of between $4.56 and $4.73 for every dollar spent. CalPERS Study: The California Public Employees’ Retirement System during the early 1990s gauged the effect of a health-risk assessment and health promotion program on PERS employees and retirees both on and not on Medicare. Interventions included HRAs every six months, individualized reports and recommendation letters, as well as self-management/medical self-care books and materials. The results: Claims for the combined employee and retiree intervention group were $361 lower than the controls; in just the retiree group, the difference was $758 per member. The cost savings over the entire population was estimated at between $3.2 million and $8 million. HEALTH INK & VITALITY COMMUNICATIONS 8 HEALTH INK & VITALITY COMMUNICATIONS 9 What Researchers Have Concluded About Health Promotion Programs Researchers have looked at the impact of Just three months after launching a 20- health promotion in a variety of ways, minute stretching program before its including what effect they have on health employees began repetitive work, Steelcase risks, health care costs and productivity. enjoyed significant declines in on-the-job injuries. Such injuries were even halved in Impact of Health Promotion one department, and workers reported their Programs on Health Risks muscles ached less, they felt better Numerous studies have demonstrated that physically and were sleeping better.8 well-conceived health promotion programs can help workers reduce their health risks. Link Between Health Risks and For example, a three-year study of nearly Medical Care Costs 10,000 employees at four auto High risk for any single health-risk factor is manufacturing plants compared four associated with higher medical costs. For different approaches at the sites: periodic example, a collaborative 1995 study between screening and referral only; such screenings what was then the Chrysler Corporation and the and awareness materials and classes; those United Auto Workers Union concluded that services plus individual follow-up smokers generate 31 percent higher claim costs counseling for at-risk employees and a menu than non-smokers, and those with unhealthy of interventions; and additional social weights had 14.3 percent higher hospitalization organization at the plant. Participation in the utilization than those with healthy weights. 9 more comprehensive third and fourth Likewise, a study published in 2002 approaches was five times greater, and concluded that a worker with diabetes generates, substantially greater improvements were on average, more than twice the medical, achieved in blood pressure results, weight prescription and disability costs as a worker loss and smoking cessation. Persistent without the disease. The tab at a Fortune 100 outreach and multiple contacts by manufacturing firm: $7,780 per year for workers counselors were linked closely to risk with diabetes, $3,370 for those without it. reductions. 7 Nearly a third of the additional costs were attributed to productivity losses.10 Other examples: Health promotion researchers such as Dee Coors’ eight-week “Lifecheck” program W. Edington, Ph.D., with the Health significantly reduced its employees’ risk Management Research Center, Division of of heart disease. Spending $32 each for Kinesiology at the University of Michigan, have 692 participants resulted in declines in also classified employees according to multiple blood pressure, blood cholesterol and risks. Those with five or more risk factors — the weight. high-risk group — and those with medium risk (three or four risk factors) cost employers more. Two years after the Minneapolis/St. Researchers have calculated that the excess Paul Metropolitan area began a weight amounts these groups cost employers above the control/smoking cessation program, cost of the low-risk group (two or less risk program participants had lost an average factors) have a mean of about 25 percent of total of nearly five pounds and 24 employees corporate medical costs. had quit smoking. That represented only Wellness scores, which most commercially a 2 percent quit rate, but at a cost of just available HRAs calculate, also show a strong $62.50 per successful quitter. HEALTH INK & VITALITY COMMUNICATIONS 10 correlation between wellness and health Most health promotion programs, perhaps care costs. understandably, focus on high-risk individuals: trying to get smokers to quit, for instance, or Changes in Risk = Changes in Costs obese workers and/or heart patients to lose As risks increase or decrease, so do costs, weight. “The whole health promotion field, according to the University of Michigan’s which was begun initially to address findings, first with Steelcase and then with cardiovascular disease, has been brought up other members of its corporate consortium. thinking about risk reduction as more of a Interestingly enough, the cost increases medical rather than a health promotion model, associated with increased risk are greater trying to reduce medical problems rather than than the declines associated with decreased promoting health,” says Edington. risk.11 But Edington’s research suggests the most effective strategy to increase the proportion of Lifestyle Accounts for 50% of Deaths low-risk people in a workforce is to prevent those already in low-risk categories from 10% moving into medium- or high-risk categories. In other words, he says we should focus on keeping the healthy people healthy. 20% Lifestyle Environment “Naturally, you want to prevent heart 50% Biology disease, lung cancer and diabetes, and most Health Services corporations who sponsor these worksite programs of course are interested in that,” says 20% Edington. But the only way to measure the success of such efforts is over the long-term, 10 Source: CDC (1980) Source: CDC (1980) to 15 years from now. But generally employers, especially companies with high turnover rates How Soon Does ROI Appear? — two to three years in some cases — are more “When can we expect to see the benefits of interested in outcomes over the next two or these programs?” Edington hears that three years, in such measures as short-term question all the time. The benefits of low- medical costs or impact on productivity. cost programs often become apparent more Using such a yardstick, Edington’s quickly than those of high-cost programs. preliminary results suggest that investing in the Both Steelcase and Progressive realized a low- and medium-risk groups maximizes the savings-to-cost ratio of greater than 3.5:1 health promotion ROI. Only when programs are within the third year of some of their low- able to spend more than $300 per year per cost programs. One company in the individual, he says, should health promotion University of Michigan consortium that programs target high-risk individuals.13 spent less than $30 per participant Based on multiple risk factors, low-risk experienced a 3:1 savings-to-cost ratio after employees represent at least 60 percent of the three years. While the return also was population, with 25 percent more in the positive for its more intense programs that medium-risk category, according to Edington. cost up to $200 per employee, it wasn’t as “These are your champions,” he says. “These high after three years. But Edington’s are your low-cost people who have low experience indicates savings will triple absenteeism rates.” expenses within five years.12 In reality, most companies that launch health promotion programs try to address both groups. Which Employees Should We Target? Says MEDSTAT’s Ron Goetzel: “You need to expend funds on primary prevention programs to keep people healthy at the same time you HEALTH INK & VITALITY COMMUNICATIONS 11 spend money on high-risk people in order to change their risk profile. HEALTH INK & VITALITY COMMUNICATIONS 12 Impact of Health Promotion Programs on Health Care Costs A comprehensive review of 72 studies by difference in medical expenditures for Brigham Young University’s Steven G. employees who had taken part in the Aldana, Ph.D., last year concluded, “The program and those who hadn’t. implementation of health promotion Duncan Aviation in Battle Creek, Mich., programs seems to result in lower levels of over several years saw health insurance absenteeism and health care costs.” While costs for its 450 workers rise only 7 percent conceding there may be some questions to 14 percent while neighboring companies about the actual causal relationship between suffered 18 percent to 40 percent increases. health promotion programs and reduced Duncan got the better rates, even though its health care costs, he concluded that “health health plans are more comprehensive, promotion programs should be considered a because over a 13-year period its health viable and effective method for helping awareness program had eliminated 60 employers reduce employee-related percent of its employees’ identified health expenses.”14 risks.17 Aldana’s review of 13 studies that As the Partnership for Prevention notes, even reported benefit/cost ratios indicated the narrowly focused health promotion programs mean benefit was $3.72 in reduced health can generate significant financial savings: care costs and $5.06 in reduced absenteeism costs per dollar invested.15 Another review Sunbeam-Oster Co., a manufacturer of small of studies by Goetzel reported a median electrical appliances with a largely female benefit of health promotion programs of workforce, made it mandatory for its $3.14 per dollar invested, a median benefit pregnant employees to attend prenatal of programs that addressed demand for classes. They made it easy by offering the medical services of $4.50 and a median classes on site during work hours, and paid benefit for disease management of $8.88.16 the women their full salaries while they were in class. The result: In the eight years Consider these examples: after the program was launched, just four premature births occurred, compared with When Citibank spent $2 million to five in the two years before the program provide a health-risk appraisal and began. Even including the cost of the pre- appropriate follow-up interventions for natal classes, the company’s costs for chronic conditions to 40 percent of its maternal and newborn care declined by 86 42,000 employees, over a 38-month percent in just two years. Average costs fell period it realized $12.6 million in from $27,243 to $3,792 per program program benefits — mostly from the employee. Short-Term Long-Term The Hanford Nuclear Reservation cut lost workdays nearly in half among workers who took advantage of flu vaccinations offered at various worksites. Estimated savings per Demand $2-$5 person vaccinated were nearly $84, 1st Management Year including productivity gains and medical care and prescription drug reductions.18 Health Promotion $3-$8 3-5 Years HEALTH INK & VITALITY COMMUNICATIONS 13 Impacts on Productivity Control Data estimates its StayWell program saved the company at least $1.8 Besides health care costs, negative impacts million over six years as a result of reduced on productivity are considered a major, and absenteeism among employees who had costly, product of poor health. Some lowered their health-risk scores. researchers even believe productivity losses In the year after a health promotion program exceed actual health care costs. was launched at multiple sites involving a According to the Partnership for police force, a chemical company and a Prevention, worksite health promotion banking firm, weekly participation in programs can improve productivity by: supervised exercise cut sick leave by an Attracting superlative workers. average of 4.8 days per person.20 Reducing absenteeism and lost time. Presenteeism Improving on-the-job decision making and time utilization. Recently, researchers also have been focusing Improving employee morale and on the impact of presenteeism: workers being fostering stronger organizational present at work, but not fully productive. commitments. Measuring on-the-job productivity is difficult, Reducing organizational conflict by and necessarily has to be job-specific. In a study building a reservoir of goodwill toward of Bank One call center operators, University of management. Michigan researchers found that workers with Reducing employee turnover.19 higher health risks have more productivity loss, and presenteeism was the major contributor to Absenteeism those productivity losses. One of the most startling results of the Bank One common yardstick to measure One study was the type of conditions that productivity losses is absenteeism. That contributed most to the presenteeism. includes days missed from work, including Researchers compared the impact of expensive, personal illness days. It also encompasses high health care cost conditions, such as short- and long-term disability and worker’s cardiovascular disease, diabetes and cancer — compensation days. At Steelcase, for conditions that many health promotion programs example, researchers early on discovered target — and lower-cost but chronic conditions that the health risks bore the same such as allergies, asthma, digestive disorders, relationship to days absent as they did to back pain and mental health problems. The health care costs. results: The lower-cost conditions heavily Results of health promotion programs on impact productivity. While a heart attack results reduced absenteeism can be dramatic. in high medical costs, after four weeks or so Consider these examples gathered by the most workers can return fully productive. 21 Partnership for Prevention: “But if you have a condition that affects you on a daily basis, minute to minute, like A 1998 analysis of five absenteeism headaches or back pain or irritable bowel studies concluded the programs syndrome,” explains Edington, “you’re not averaged savings of almost $5 for every going to be productive since your mind is trying dollar spent. A health promotion to get through the pain before actually program at DuPont was credited with concentrating on your work.” cutting days lost to illness or disability Goetzel agrees: “If I’m at my desk eight by 14 percent. A rehab program Coors hours a day and suffering from allergies, sponsored for 180 post-coronary migraines or headaches, back pain or a host of patients cut lost days by 68 percent. other issues, what proportion of my day is HEALTH INK & VITALITY COMMUNICATIONS 14 essentially unproductive because I’m not these conditions without being effectively performing at optimal levels? Some research treated.” indicates that may be as much as a quarter Presenteeism, Edington concludes, or half a day lost if you are suffering from contributes more to productivity losses than absenteeism does. HEALTH INK & VITALITY COMMUNICATIONS 15 Instituting a Good Health Promotion Program Depending on how comprehensive the plan, optimal levels — indicate the business and there is a wide cost range associated with program objectives are aligned.” health promotion programs. Some Determine your company’s chief companies begin with relatively simple and organizational health indicator issues: inexpensive initiatives, such as distributing Some organizations, says Leutzinger, a wellness newsletter. On the more determine these issues through an analysis comprehensive side, multi-faceted health of health claims data that might, for promotion programs usually begin with a instance, identify heart disease risk, high health-risk assessment to benchmark the cholesterol and/or obesity. Other companies starting point and to guide future steps. The might be more interested in productivity costs for programs pale when you consider issues, such as absenteeism, employee what most employers already are spending relations, or recruitment and containment. to ensure health and productivity. Match health promotion programs with “The average employer today is spending health indicator issues: “If you’re most between $4,000 and $5,000 per year on interested in reducing claims from one year health benefits. With annual double-digit to the next, you probably want to install a increases, in some cases over 20 percent, self-care education program that can show spending is going up dramatically on the an immediate return. If that was your goal, health care side,” says Goetzel. “If you you wouldn’t want to open an 80,000- factor in productivity losses due to health — square-foot fitness center in the first year,” absences, disability, workers compensation says Leutzinger. “But if a company like and items such as turnover costs — that Microsoft was interested in recruiting and figure can double to $10,000 or more per retaining promising younger-generation employee per year. employees, being able to show off a large “When viewed that way, the cost of a fitness center at the end of the interview prevention program doesn’t look all that may help persuade the candidate to take the significant.” job.” Experts such as Goetzel and Union Pacific’s Joseph Leutzinger suggest certain Senior management must champion the elements are necessary for a successful program. health promotion program. These include: Champions at the worker level also must Align the program with the be passionate and enthusiastic: Their company’s purpose and mission: advocacy must be a meaningful part of their “You can’t have programs sitting off in work. the backwoods in a trailer somewhere Periodic health-risk assessment and where it’s very easy to get rid of them screening program: Regular assessments when times get tough,” says Goetzel. get as many employees as possible involved. “Companies whose mission statements Incentives might be necessary. According to focus on human capital — such as being Goetzel, Citibank offered employees a $10 dedicated to attracting and motivating credit on their benefit plan and generated a the best employees, being an employer 50 percent participation rate in their of choice, making sure employers work assessment program; a Johnson & Johnson in safe and protected environments and program that offered employees a $500 making sure the employees are incentive generated a 90 percent physically and mentally performing at participation rate. According to the HEALTH INK & VITALITY COMMUNICATIONS 16 University of Michigan’s Dee W. employee involvement stimulates interest Edington, annual health-risk assessment and ownership of the program; it’s participation rates of 20 percent to 30 contagious. Encourage advisory committee percent are common. Among long-term members to talk up the program informally, employees at Progressive, over 10 years even before a program starts. Word of 80 percent of the employees participated mouth often is the best marketing device. at least once; 60 percent did so at least Ask people what they want and give it to twice and 40 percent at least three them: A needs-assessment survey builds a times. So, given the chance, most sense of anticipation and excitement that employees eventually will participate. can help increase participation. Failure to Systematically triage and funnel understand the needs and interests of workers identified as being at higher potential program participants will almost risk into appropriate follow-up assure low program participation. programs. Make the program fun: People enjoy Encourage individuals to participate doing what’s fun. Use balloons, flowers and in multiple programs: This is a key music to create a festive atmosphere for success indicator. At Progressive, health fairs or health-screening activities. individuals who took part in programs Provide incentives: Well-conceived multiple times over a nine-year period incentives can be expected to increase had lower health care costs. For those program participation rates by 12 percent to who participated in zero to three 35 percent. Incentives also can encourage programs during that period, health care the completion of or attendance at multiple costs rose 7.8 percent annually. Those program sessions and help participants who participated in four or more adhere to long-term behavior change. programs saw health care costs decrease Publicize the program in different ways: 1 percent annually — a total savings of Use multiple upbeat methods to promote the nearly $4 million over the nine years. program to potential participants, including Measure and evaluate: “You can have bulletin boards, pamphlets, payroll inserts, the finest program with the best science voice-mail messages, electronic billboards, and motivated program managers, but if etc. A creative program name and logo will you don’t have measures to document help to create a positive image that can help the program impacts, in many ways increase utilization. you’re wasting your money,” says Wow, the boss is doing it! Small business Goetzel. “Eventually someone is going owners or top managers who participate in a to ask ‘Does this work?’ Unless you program encourage others by their example. have the data to support that it is The general manager for a large refinery in working, both in terms of improving Joliet, Ill., frequently told employees that health and potentially saving money, anyone could talk with him while he is on you’re going to have a hard time the treadmill where he works out virtually justifying the program.” every morning. Cultivate support from all levels of management. Tips to Increase Participation Remove barriers: Make health promotion Here’s some advice from the Partnership and related activities easy to sign up for and for Prevention on how to increase employee conveniently located. participation in health promotion programs: Provide program choices: Don’t just offer Involve people in planning: Ensuring a group smoking cessation program. Also good participation starts with the offer guided self-help programs such as program planning process. Broad HEALTH INK & VITALITY COMMUNICATIONS 17 video or audiotapes and workbooks that participants liked best about the program, employees can use privately. what they liked least and also solicit Ask how you are doing: Routinely suggestions for program improvements or measure program participants’ new topics to address. satisfaction with the program content, Why not? Ask some of the people who do instructors, logistical arrangements and not participate, why not? Their answers can other program components. A simple help formulate strategies to help ensure evaluation can determine what participation of non-participants.22 HEALTH INK & VITALITY COMMUNICATIONS 18 Basic Components of Health Promotion Programs Following are some of the initiatives 6. Offer interactive services such as personal included in corporate health promotion menus for access to health encyclopedias. programs: 7. Offer special topic-targeted supplements: These enable employers to address special Newsletters and Other Health needs within their organizations, such as Education Materials self-care cost containment programs, Newsletters are an affordable first step and chronic conditions, substance abuse issues, an ongoing foundation for corporate productivity and seniors’ health. wellness efforts. Newsletters or magazines can combine news about company programs Health-Risk Assessments (HRAs) with general interest articles on timely These gauge risks, health history and readiness health topics. A wealth of print, online and to change. Generally offered to employees on a video materials also is available, including voluntary basis, HRAs are the key to identifying self-care guides, self-management advice the health and lifestyle status of your workers. for persons with chronic conditions and They also provide immediate confidential instruction sheets on wellness topics. Such feedback that can get people thinking about their educational tools can heighten awareness, lifestyles and how choices they make affect their enhance personal performance and reduce health. By building such awareness, health costly health care utilization. Such assessments are the first step in encouraging communication materials: employees to maintain their healthy lifestyles 1. Send a positive message: Employees and to take positive steps to improve their health receiving such materials notice and status. appreciate their company's concern for Focusing on behaviors that people can their health and well-being and that of change, assessments cover such areas as activity their families. and exercise; alcohol use; back care; 2. Educate people to make better health demographics; driving; eating habits; height, decisions: As we ask people to take weight and body frame; mental health; screening greater responsibility for their health, exams; screening values; self-care skills; health and wellness communications smoking/tobacco use; stress management; help them make better informed health weight control; family history of chronic decisions, then reinforce such decisions disease; and readiness to change. regularly. When employees retake these assessments in subsequent years, they receive comparative data 3. Enable companies to reach each that illustrate how much or how little progress employee’s unique health interests: they are making toward healthier lifestyles and To ensure that there's something for reduced risk. Whether it’s the first or umpteenth everyone in each issue, most newsletters time an employee has taken an HRA, the address a variety of important wellness assessments reinforce positive scores; compare topics in each issue. the individual to others of the same age and 4. Offer visual appeal: Bold formats are gender; highlight each individual’s main health attractive and inviting to readers, both risks; outline the benefits of changing risky employees and insured dependents. habits; and suggest positive steps to take 5. Reach readers at home: This is where immediately. Employees also are alerted to any health issues and health decisions occur. HEALTH INK & VITALITY COMMUNICATIONS 19 health conditions that warrant a doctor’s Focused interventions: Phone-based and prompt follow-up. on-site wellness coaching and mail-based Meanwhile, employers receive an educational programs on lifestyle and chronic aggregate data report on their workforce. disease management issues targeted to risk level The StayWell Company’s management and tailored to individual needs. Intervention reports, for example, highlight: programs with health educators can include: Risk factors: Reports identify five Weight management primary risks in the total workforce and Nutrition among high-risk individuals, who — as Exercise we have seen — usually cost more to Stress management cover. The reports also outline the Self-care degree of readiness to change at each Smoking cessation risk level, which is key information for Blood pressure management targeting behavior-change programs. Cholesterol management Avoidable costs: Based on the Adult asthma company’s risk profile, the report Type 2 diabetes estimates the direct health care costs, Coronary artery disease indirect costs (such as absenteeism and Hypertension low productivity), total costs associated Chronic heart failure with behaviors that people can change, and the potential savings from reducing Back care/occupation ergonomics risk. Chronic disease self-management Online services: Intranet or Internet-based Recommendations: By identifying the health improvement tools include HRAs, most costly health issues and the degree health and self-care information, of readiness to change, recommenda- personalized health news and customer- tions are geared toward creating the specific resources. greatest benefit for employees and the company. To control health costs and Onsite services: Health screenings, health improve well-being, recommendations fairs and events, campaigns and fitness might include behavior-change center management. programs for high-risk individuals, Telephone services: Toll-free help lines education programs to increase employees can call for informational individuals’ readiness to change and support, guidance and encouragement to organization-wide health promotion motivate healthy lifestyle change. programs to motivate people to consider Fitness center enrollment and the benefits of improved behaviors. individualized fitness programs. Armed with such information, Single-session workshops interventions and incentives can be targeted Intensive group and self-study education and the effectiveness of an employer’s program can be closely monitored. Periodic general and specific health screenings Health-Risk Assessment Follow-up Safety training Once an initial assessment identifies a Program management: Your health company’s needs, various health promotion promotion partner can help with program programs can be implemented. These design and development, marketing, include: promotion, implementation management and evaluation. HEALTH INK & VITALITY COMMUNICATIONS 20 Some elements of health promotion contribute to the overall cost-effectiveness of an programs can be hard to track, such as the established health promotion program,” percentage of employees who read a Edington says. “Newsletters, bulletin boards and newsletter or take part in a fitness activity. telephone numbers are all part of maintaining In an early UAW-GM study, the recorded low-risk employees and creating an overall cumulative participation rate after three environment that keeps healthy lifestyle and years was just 40 percent. But when quality-of-life issues in front of people all the employees responded to a randomly time. administered survey, self-reporting pushed “They are a way to improve knowledge, that percentage to over 80 percent. awareness and attitudes, and once people move “These nontrackable components through those these phases, you get behavior provide an important benefit and likely change.” HEALTH INK & VITALITY COMMUNICATIONS 21 Conclusion The average annual health insurance productivity, wellness programs represent a premium in 2000 was $2,655 for single significant, cost-effective tool. coverage and $6,772 for family coverage in Therefore, companies that purchase private-sector companies, according to the insurance plans, says Kenneth Sperling, health Agency for Health care Research and care practice leader at Hewitt Associates’ Quality. Those levels represent increases of Norwalk, Conn., should select health plans that 33.3 percent for individuals and 36.7 have adequate disease management capabilities, percent for families since 1996. Despite since that can result in lower premiums based on these increases, the percentage of private- claims experience. sector companies that offered health insurance also increased, from 52.9 percent to 59.3 percent. As a result, almost 90 “Those who don’t make time percent of all employees worked for for wellness will be forced establishments that offered such coverage, compared with 86.5 percent in 1996.23 to take time for illness.” Given such cost and participation increases, it has become increasingly urgent Likewise, Sperling says, the growing number for both employers and employees to seek of self-insured companies now have few options ways to curb the spiraling cost of health beyond health promotion programs. care, which continues to significantly "How am I possibly going to beat the outpace inflation. inflationary trend if I don't manage the claims?" “Those who don’t make time for he wonders. "In one sense, the market is driving wellness will be forced to take time for toward health promotion because that is all we illness,” Jeff Null, manager of Dow have left other than prescription drug strategies Chemical’s South Charleston, W. Va., and cost sharing. Cost sharing changes the way fitness center, asserts in the National Safety the pie is divided up, but disease management is Council’s Safeworker.24 one of the biggest arrows in the quiver to reduce Clearly, as a means to reduce employees’ the size of the pie." health risks, curb health care costs and improve employee well-being, morale and HEALTH INK & VITALITY COMMUNICATIONS 22 The Union Pacific Story Union Pacific Railroad opened its first offers informational packets on key health employee fitness center at its Omaha, Neb., numbers everyone should know in relation to headquarters in 1987. It soon began to outfit a good health, such as: number of rail cars as fitness centers; the cars 80: Minimum desirable HRA score would follow crew members who were 30: Recommended minutes of exercise responsible for track repair. Since crew most days of the week members who used to live in bunk cars now get a lodging per diem, Union Pacific has 24: Desirable body mass index retired its fitness rail cars. 8: Recommended hours of sleep But a program that originally started out Union Pacific also conducts an active just for rail workers now has grown to more information campaign. Ten times a year than 500 exercise facilities (mostly vendor workers receive an exclusive Union Pacific contracted) spread across 25 states. “We newsletter, Well Workplace. It also produces believe it’s the largest employer-sponsored and distributes an on-line newsletter three exercise program in the country,” says Joseph times a week that features one or more health A. Leutzinger, Ph.D., Union Pacific’s director tips, a health article and news about the of health promotion. company’s health promotion programs. That exercise program has remained the Employees also receive region-specific foundation of Union Pacific’s health newsletters, and employees at the promotion program — but it is by no means headquarters can see a billboard-type TV that the only health promotion element. In 1992 delivers about 100 health messages, usually Union Pacific introduced Health Track, a risk text messages, every five minutes. identification/risk reduction program that During the mid-1990s, Union Pacific also targets 10 lifestyle risk factors and chronic implemented a company-wide medical self- conditions. Last year the company modified care program. Five years ago it began to its Health Track program to offer workers a integrate its health promotion program with its broader menu of approaches that vary in time, alertness management initiatives — an intensity and commitment. The modification important priority for a company with railroad is an attempt to reach workers who haven’t operations. Integrating health into the core completed a health-risk assessment and also to operations of the railroad, the company encourage those who’ve completed an endeavors to help its employees see the link assessment to do so regularly — every six between lifestyle habits and fatigue, and the months or at least annually for those with critical relationship between health, alertness identifiable risk factors. and productivity. Data still being analyzed, So far, 18,000 of Union Pacific’s 50,000 says Leutzinger, shows a relationship between employees have completed at least one health some of the risk factors identified through the -assessment. But Leutzinger notes that is not health-risk assessment, such as being the only way employees can interact with the overweight, and injury rates and severity of company’s health promotion programs. To injuries. build health awareness, it also offers a “Know The results of Union Pacific’s health Your Numbers” promotion four times a year. promotion initiatives have been impressive. In It conducts presentations, produces videos and 1990 the company concluded 29 percent of its HEALTH INK & VITALITY COMMUNICATIONS 23 health care dollars were spent on known health and health care,” says Leutzinger. The lifestyle-preventable causes. Five years later, ROI Union Pacific measured was similar to after implementing several programs to the results of other peer-reviewed, published provide employees and spouses with self-care initiatives: a benefit-cost ratio of assistance in reducing their respective risk $2.77:$1. factors, just 24 percent of the railroad’s health It all adds up. Union Pacific also recently care costs were related to poor lifestyle habits. used the HERO database to project its health Data just in indicates such habits contributed care cost increases over the next 10 years to only 19 percent of Union Pacific’s 2001 based on changing demographics and risk health care costs. factor profiles. The study tested four different The self-care program, meanwhile, was scenarios. They ranged from what would designed to help workers understand when it’s happen if the company eliminated its health appropriate to self-treat conditions, rather than promotion program, to achieving a 1 percent going to a doctor or emergency room, and to annual reduction (or 10 percent total reduction make sure that when they do visit a doctor over the 10-year period) in total risks. The they make the best use of that visit by being result: a $77 million difference between prepared for it. “We’re simply trying to make eliminating the program and cutting risks just the employee a more proactive consumer 1 percent per year, which, Leutzinger notes, when it comes to his or her own personal Union Pacific has been achieving. HEALTH INK & VITALITY COMMUNICATIONS 24 The Northeast Utilities Story Northeast Utilities (NU), New England’s lifestyle habits. Between 1998 and 2000, largest utility company, won a C. Everett 4,125 individuals at NU participated in the Koop National Health Award for its HRA. Based on their modifiable health risks, WellAware programming. 25 StayWell estimates these participants After instituting the program for its generated $8.8 million in avoidable direct and employees in 1994, the company analyzed its indirect costs. impact on 1996 medical claims. It wanted to During that same three-year period, 2,577 know: participants completed a second HRA. Their Does the program produce a positive overall average lifestyle score improved from ROI? 70 to 73, and they also experienced significant reductions in risks, including: Did the estimates for how much the program would save the company jive 31 percent decrease in smoking with its actual health claims experience? 29 percent decrease in lack of exercise Have initiatives targeted at specific 16 percent decrease in mental health risk lifestyle and behavioral risks produced 11 percent decrease in cholesterol risk their intended results? 10 percent improvement in eating habits Examining annual per capita health 5 percent decrease in stress benefits costs for the years 1992 through 1996, an analysis concluded that — during a Also, the number of health risks for these time when most employers were experiencing repeat HRA participants improved. per capita health care cost increases of 15 Participants with: percent to 20 percent — NU experienced flat less than three risk factors increased 6 percent. per capita costs. Of the total savings, NU less than two risk factors increased 9 percent. experienced a $1.4 million reduction in six or more risk factors decreased 4 percent. lifestyle and behavioral claims. Conservatively attributing 70 percent, or Based on the risk reductions of the 2,577 $1 million, of those savings to the positive repeat HRA participants, StayWell estimated effects of the WellAware program yielded a annual savings to NU of more than $1 million. return on investment of 1.6:1. The C. Everett While completing an HRA alone has been Koop National Health Awards concluded shown to reduce health care costs, NU’s WellAware’s expected impact on reducing experience illustrates that completing an HRA claims would grow greater with time. and participating in a wellness activity Broadening participation in programs, the lag reduces risks even further. For example, NU between the change in unhealthy behaviors employees who completed an HRA, and reduced health care claims for many participated in at least one health education preventable conditions, and opportunities to activity and completed at least 12 weeks of address high cost claimants all were thought cardiovascular activity experienced greater to be factors that could improve NU’s ROI in risk reductions than those who just completed the future. a HRA in the following categories: blood The first step in participating in NU’s pressure, cholesterol, eating habits, exercise, WellAware program is the completion of smoking and stress. StayWell’s HealthPath Health-Risk Finally, NU’s program illustrates the Assessment (HRA). The HRA provides an effectiveness of telephone-based assessment of important health risks that intervention programs for workers at high participants can reduce through changes in risk in two or more health areas. HEALTH INK & VITALITY COMMUNICATIONS 25 1 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 3. 2 Ibid. 3 Aldana, Steven G. "Financial Impact of Health Promotion Programs: a Comprehensive Review of the Literature" in American Journal of Health Promotion, May/June 2001, Vol. 15, No 5: 296-320. 4 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 5. 5 Health Enhancement Research Organization, www.the-hero.org/research.htm. 6 Golaszewski, Thomas. "Shining Lights: Studies That Have Most Influenced the Understanding of Health Promotion's Financial Impact" in American Journal of Health Promotion, May/June 2001, Vol. 15, No.5: 332-340. 7 Anderson, David R., Seth A. Serxner and Daniel B. Gold. "Conceptual Framework, Critical Questions, and Practical Challenges in Conducting Research on the Financial Impact of Worksite Health Promotion" in American Journal of Health Promotion, May/June 2001, Vol. 15, No.5: 281-288. 8 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 5. 9 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 6. 10 Lippman, Helen. "Healthier Communities on the Horizon" in Business & Health: The State of Health Care in America 2002, The Business and Health Institute:38,40. 11 Edington, Dee W. "Emerging Research: A View From One Research Center" in American Journal of Health Promotion, May/June 2001, Vol. 15, No.5: 341-349. 12 Ibid. 13 Ibid. 14 Aldana, Steven G. "Financial Impact of Health Promotion Programs: a Comprehensive Review of the Literature" in American Journal of Health Promotion, May/June 2001 Vol. 15, No 5: 296-320. 15 Ibid. 16 Goetzel, R.Z., T.R. Juday and Ronald J. Ozminkowski. "What's the ROI? A Systematic Review of Return-on-Investment Studies of Corporate Health and Productivity Management Initiatives." AWHP's Worksite Health. 1999;6(3):12-21. 17 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Pages 6-7. 18 Ibid. 19 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 4. 20 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 5. 21 Edington, Dee W. "Emerging Research: A View From One Research Center" in American Journal of Health Promotion, May/June 2001, Vol. 15, No.5: 341-349. 22 Healthy Workforce 2010: An Essential Health Promotion Sourcebook for Employers, Large and Small. Partnership for Prevention. Fall, 2001. Page 29. 23 Agency for Health care Research and Quality, "Health Insurance Premiums Rose More Than 30 Percent Between 1996 and 2000," AHRQ press release, September 12, 2002. 24 National Safety Council, Safeworker, August 2002. 25 See http://healthproject.stanford.edu/koop/NortheastUtilities/documentation.html.
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