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Document Sample
Five
Minnesota
companies large
and small are
confronting health-
care costs to win a
healthier balance
Companies that Walk sheet and a
healthier, happier
the Walk (Literally!) work force.
By Andrea Lahouze
The rising cost of health care has Medical device manufacturer Medtronic’s
long been a concern for employers, who have cost-saving journey began in 2001 when it
absorbed premium increases for decades. Those was one of the first companies to switch to a
years of inflation-outpacing increases paired high-deductible health plan. For the Fridley-
with tighter recessionary budgets now have based business, which employs 8,000 people
many employers in an ever-tighter, ultimately in Minnesota and 28,000 in the United States,
unsustainable and seemingly unbreakable bind. health-care consumerism was key to a long-term
But at five Minnesota companies, a very approach to efficient medical spending.
different scenario is playing out. Each armed The Schwan Food Company and Alexandria
with a custom-tailored approach yet a common Extrusion Company’s self-insured statuses both
resolve, Alexandria Extrusion Company, Bepex require and motivate their company leaders to
International, Medtronic, Ralco Nutrition and maintain continuously proactive approaches to
The Schwan Food Company are attacking rising employee health and medical spending.
health-care costs from a diverse array of angles. “Being self-insured means that improvements
And they are winning. that you make within your plan costs, you real-
ize immediately, and additional expenses affect
Tipping Points you immediately. We’re our own best friend
For these companies, cost-saving efforts en- or worst enemy,” says Michelle Warme, senior
compass both reactive and proactive responses director of benefits at Schwan.
to rising health-care expenses. Livestock feed Prior to 2010, Schwan’s business units offered
manufacturer Ralco Nutrition had taken on fitness and nutrition programs at many facili-
double-digit premium increases for years. The ties, but the programs lacked an even distribu-
call for change came when it was faced with an tion and uniform structure, and did not tie into
estimated 21.6 percent increase for 2009 — an a larger wellness movement accessible to the
increase that the Marshall company decided it company’s geographically dispersed population.
could not absorb. In Minneapolis, custom food Warme says a 2009 Gallup employee engage-
and chemical process equipment manufacturer ment survey prompted the company to develop
Bepex International’s cost-saving catalyst was a cohesive wellness campaign. The long-term
also the threat of an unsustainable rise in premi- goal was to improve the work force’s collective
ums, which inspired the company to spring into health status by bringing consistent health-
action in late 2007. related messaging, activities and opportunities
24 ENTERPRISE MINNESOTA NOV/DEC 2010
and online care rooms where workers can virtu-
ally connect with doctors are just some of the
perks within wellness campaigns at Medtronic
and Schwan.
Ralco Nutrition pays for the first three months
of smoking cessation aid and offers free, tele-
phone-based health coaching, a $200 incentive to
employees who engage with a health coach for at
least six months, and another $200 incentive for
completion of a health risk assessment. Multiple
fitness challenges — including a pedometer-
based walking challenge in which teams compete
for the most steps, and “Weight Loss By Eight,”
a challenge to lose a pound per week for eight
weeks — give workers opportunities to receive
money in their HSAs. The HSA incentive helped
drive a 90 percent participation rate in the walk-
ing program this summer.
Incentives are important, but Shelly Gniffke,
who works in human resources and leads Ralco’s
to employees across all locations. And earlier wellness efforts, adds that a gradual introduc-
this year, Schwan entered into a partnership tion of programs has helped Ralco to develop a
with RedBrick Health of Minneapolis, as an culture of wellness. The company began with a
investment in health management programs for health-risk assessment in 2008, and then added
all its employees. The approach was holistic, new components to its wellness program over a
treating wellness as an integral part of employee period of years.
engagement. It also was a way to realize benefits “I think part of the reason it has been suc-
like better productivity and lower turnover, cessful is because we have stair stepped it,”
which can have significant, if difficult to quan- Gniffke says of Ralco’s wellness program. “It’s
tify, bottom-line impacts. not something that you can just throw at your
“We started to link the whole wellness move- people and try to get them to understand all at
ment to our employee engagement. Obviously, once, because it’s been a process.”
if you feel better, you’re going to feel more Bepex International President Ralph Imholte
engaged, you’re going to be more productive, agrees. “There are people [at Bepex Internation-
you’re going to enjoy doing what you do more. al], especially people of my generation, who grew
It reduces absenteeism and presenteeism,” up with a different sort of understanding of the
Warme says. “At the end of the day, all of our employer-employee relationship. They are kind
employees are not enrolled in our medical plan, of uncomfortable with the employer channel-
but all of our employees affect us in terms of ing advice on health. … I think you
their productivity when they are at work.” have to start slowly … with our
More Carrots
Though a handful of employer incentives are
based on a desire to maintain the status quo,
such as higher premiums for employees with
more health risks, company leaders agree that
investments in making the healthy choice the
easy choice are key to achieving high employ-
ee engagement in wellness efforts.
Free flu shots, biometric screenings,
fitness center discounts, 24-hour nurse lines
ENTERPRISE MINNESOTA NOV/DEC 2010 25
population,” Imholte says. company fitness and nutrition-oriented chal-
Small changes helped to ease Bepex Interna- lenges held throughout the year. Employees
tional’s 45 employees into the concept of work- must also take biometric screenings to ensure
place wellness. Spearheaded by two employees, that their participation goes beyond filling out
the company’s commitment to health began the paperwork. To move even more workers off
by updating and reopening a long-abandoned the couch, Alexandria Extrusion raises premi-
workout room and replacing typical vending ums 50 percent for non-participants, making
machine fare with healthier options. Additional the wellness program a no-brainer.
opportunities for employee engagement have At Medtronic, a points system similar to
since followed, including companywide golf and Bepex International’s translates into up to $150
softball outings, free participation in Minneapo- annually. Employees can earn points by com-
pleting activities like a health-risk questionnaire
or participating in Medtronic-sponsored fitness
events like the Heart Walk and Medtronic Twin
Cities Marathon.
Schwan also is taking the points and rewards
route, with a twist. To make getting and staying
healthy appealing to employees across all loca-
tions, Warme teamed up with BI Worldwide
Inc. in Bloomington to develop Living Well,
a web-based employee wellness rewards and
recognition incentive program. The program
is an extension of an existing platform that
Schwan uses for its sales team incentive pro-
grams and was rolled out to all employees in
January. It awards points for completing a menu
of accomplishments and activities, which can
be exchanged for BI online store items, which
number in the thousands and range from pens
to TVs. Sales team members now can combine
points earned from both sales and wellness-
related accomplishments, and all other employ-
ees now are included as part of the all-employee
rewards and recognition program.
Above: The lis’s annual Get In Gear 10K race for workers
women who and their spouses, and an optional and free Healthy Rewards
started the
Bepex Healthy “Lunch & Learn” lunchtime speaker series on Success has come in many forms throughout
Refrigerator a variety of health topics, such as back pain and each company’s wellness journey. Gniffke says
program. From
left: Becky Haaf, financial health. Ralco Nutrition’s annual premium increases have
Bonnie Klatt, In January, Bepex will kick off a premium begun to decrease thanks to a new insurance
Sara Carlsen
and Heather
reduction program to encourage employee company that values its wellness program enough
Arbanella. participation in its menu of healthy activities. to cut its premium increase from the projected
Employees will receive points for attending 21.6 percent to 15 percent. Gniffke hopes that
Photograph by
Mark Palas wellness events or setting and achieving per- future increases will shrink to single digits.
sonal health goals, which help workers earn “Our goal is a single-digit increase, but we also
additional vacation days and up to a 10 percent have this unknown factor out there with health-
discount on monthly premiums. care reform,” she says. “We will definitely be
Alexandria Extrusion Company also appeals committed to our wellness program no matter
to workers’ wallets with discounted premi- what happens with health-care reform, but we’ll
ums. Instead of a points system, the qualifying just have to take each year as it comes.”
requirement for discounts is participation in Medtronic does not release specific numbers re-
26 ENTERPRISE MINNESOTA NOV/DEC 2010
garding year-over-year health-care costs. But Rog- nalizing that to the point where they’re feeling
er Chizek, director of U.S. benefits for Medtronic, more a part of something, as opposed to the
does reveal that Medtronic’s cultivation of healthy old paradigm, where I put in my eight hours,
and cost-savvy health-care consumers is also driv- you give me a paycheck, and that’s the extent of
ing a cost-saving trend that is directly attributable our relationship. I sense that people are more
to many of its health-care initiatives. involved [now].”
“The end result is that [the employees] be- Now that business is coming back, Imholte
come better consumers of health care and much also sees a difference in efficiency around the
more knowledgeable about the kinds of things office. “From a business point of view, I think
that can affect their health and, ultimately, their it’s had an impact on commitment to meeting
out-of-pocket costs,” Chizek says. objectives and meeting deadlines where people
To date, Schwan’s months-old wellness move- have taken more ownership and said, ‘Okay, the
ment has not yet affected its premiums. But deadline is Friday. That means we have to get
Warme is proud of the strides it has made in set- this done,’ as opposed to, ‘Well, if it’s not done
ting the stage for benefits in 2011 and beyond, Friday, we’ll get it done next week.’ That com-
and describes expected future benefits as a “bal- mitment to goals has changed,” he says.
ancing act” of tangible and intangible savings. Alexandria Extrusion Company’s wellness pro-
“You can’t minimize the impact of being able gram has kept recent premium increases under
to leave money on the bottom line because 10 percent. This year, Lynette Kluver, director
you’re not paying it out for claims,” she says. of organizational development, is proud to say
“On the other hand, I think that from an en- that the company has reached a new milestone
gagement viewpoint, you also really need to look in its cost-saving journey: a 0 percent premium
at productivity and at reducing absenteeism.” increase for 2011. Employees also will enjoy the
For leadership, Warme believes understand- added benefit of a health advocate service, which
ing wellness as a business initiative is crucial. can make calls and conduct research on behalf
“Employee wellness affects how people perform of employees to resolve billing issues, locate
and what they bring to work with them. In that the best value for specific medical treatments or
respect it isn’t a benefits initiative; it isn’t an HR procedures, and even research care options for
initiative: It is a business initiative,” she says. “If employees with elderly parents.
you can get leadership able to understand, moti- Perhaps the greatest long-term savings for
vate and influence their employee base to be on Alexandria Extrusion Company comes from its
board with that, you will see very positive results healthier employee population. The 189 em-
and certainly an opportunity for success.” ployees who have participated in the company’s
Following a five-year run of increasing premi- wellness program since its 2006 inception give
ums, Bepex International’s wellness efforts were evidence of promising trends. In 2006, for ex-
recently rewarded with a 1 percent decrease in ample, 128 of those employees needed to lower
premium costs. Savings for Bepex also reach their blood pressure, and 122 needed to improve
beyond the tangible. Imholte credits his com- their glucose levels. This year’s screenings show
pany’s commitment to wellness with helping it that 108 of those employees have achieved lower
to overcome recessionary woes in 2009 without blood pressure, and 93 have improved their
falling apart at the seams. blood glucose levels. While 71 employees had
“We all took pay cuts, we had a reduction more than one health risk factor in 2006, that
in force — all the things that would usually start number has dropped to 53 this year. Kluver
to be a problem from a motivation and morale expects it will only decrease in future months
point of view. But I think the [wellness] program and years.
helped us get through that and still feel like “We have low employee turnover, we have
we’re a functional group. In that sense, it’s more happy customers, we have healthy employees
[about asking] how bad would it have been if and we have a thriving business,” Kluver says.
we didn’t have that program. But … many “That’s what I consider success.”
of the people responded positively, knowing
that the company cares about them, and inter- Andrea Lahouze is an editor of Enterprise Minnesota.
ENTERPRISE MINNESOTA NOV/DEC 2010 27
