Use integrated approach to prevent chronic conditions
Don't focus on medical, pharmaceutical costs alone
Preventative approaches are taking off with employers "like never before," and occupational health professionals are key players in this exciting trend, according to Ronald Loeppke, MD, chief strategic officer of health enhancement and productivity for Matria Healthcare, a Marietta, GA-based provider of health enhancement programs.
"I have been in the occupational and corporate health world for almost 25 years, and we are witnessing a tectonic plate shift for how employers are valuing this," he says. While only a handful of "early adopters" were investing in preventative approaches a few years back, it's now in the mainstream, says Loeppke. Employers are convinced that if they reduce health risks in their workforce, they will see sustainable cost reductions over time, he says.
As health care costs continue to skyrocket, more employers are facing the fact that employees with chronic conditions cost U.S. industries billions of dollars, says Tamara Y. Blow, manager of occupational health services at Philip Morris USA. "These costs are not only demonstrated in health care costs, but also in productivity," she says. "As a proactive approach, corporations are now utilizing futuristic approaches to managing health care costs. That approach is through lifestyle management."
For every dollar spent on medical and pharmaceutical costs, employers are spending $4 on health-related productivity losses, says a recent study.1 "Medical and pharmaceutical costs are only the tip of the iceberg, and that is where people have focused for years. Now we are really seeing employers looking upstream and being very interested in prevention," says Loeppke, the study's lead author.
The interest is coming "out of the "C" suite," which is CEOs, CFOs, and COOs, who are finding that the health of their workforce is linked to the bottom line profits of the company, Loeppke says. "Now, prevention and health enhancement is an investment to be leveraged, rather than a cost to be justified," he says. "We are seeing not only large employers, but small to medium size ones, recognizing the benefits of a healthy workforce. This is very exciting for occupational health."
Occupational health professionals understand the clinical and business side of medicine, so they are the best people to drive this trend, explains Loeppke.
An integrated approach looks at all aspects of health-related costs, instead of focusing on cost reduction for only one area, such as pharmaceuticals, says Loeppke. He likens this approach to squeezing one side of a balloon to reduce costs, but then the other side bulges out because costs go up in other areas.
"Integration has been talked about for years, but now it is really happening," he says. To develop a blueprint for action at your company, measure the full health and productivity costs related to the burdens of illness and health risk in your employee population, Loeppke recommends.
Occupational health professionals can accomplish this step by first doing a health and productivity risk assessment of the population, to identify health risk categories, he says. Second, they can analyze the medical and pharmaceutical claims cost categories to identify the prevalence rate of medical conditions that are the main cost drivers, says Loeppke. By taking these steps, the burden of illness and health risk unique to your population will guide your investments in integrated population health enhancement strategies for your entire population, says Loeppke.
"Some workers are on the verge of their first diagnostic event, while others are healthy now and want to stay that way," he says. "We need to address all those elements to really do effective population health management, along with individual health management, in order to achieve a sustainable impact on costs over time."
Redefine your ROI
When it comes to wellness programs, employers are moving beyond a purely financial interpretation of return on investment (ROI), says Loeppke. Many different methodologies are used to calculate ROI, he says. "But the bottom line is that we consistently are finding that these initiatives do provide a positive return," he says.
He recommends using the term value of investment (VOI) to include other components that need to be tracked along with financial return. Some examples are: Has the rate of preventative screening increased? Have clinical indicators improved? Is presenteeism and absenteeism going down? "All those indicators should be pointing in the same direction," Loeppke says.
Integrated population health management requires integrated population health measurement, says Loeppke. To yield the greatest value from your investment, you need to pull together all the data sources across the continuum of health and productivity enhancement, and translate the integrated data into actionable information, he explains. "The health of the workforce is inextricably linked to the productivity of the workforce, and therefore, the health of the bottom line for employers," says Loeppke. "In fact, good health is good business."
1. Loeppke R, Taitel M, Richling D. Health and productivity as a business strategy. J Occup Environ Med 2007; 49:712-721.
For more information on reducing health risks in the workforce, contact:
- Tamara Y. Blow, Manager, Occupational Health Services, Philip Morris USA, P.O. Box 26603, Richmond, VA 23261. Phone: (804) 274-5805. Fax: (804) 274-5489. E-mail: Tamara.Y.Blow@pmusa.com.
- Ronald Loeppke, MD, Chief Strategic Officer of Health Enhancement and Productivity, Matria Healthcare, 1850 Parkway Place, Marietta, GA 30067. E-mail: firstname.lastname@example.org.
Matria Healthcare provides incentive programs to improve health and lifestyle areas that are increasing health care costs. The firm also performs health and productivity assessments to identify and target specific risk factors. Costs vary based on the number of employees participating and the types of products and services provided. For more information, contact: Matria Healthcare, 1850 Parkway Place, Marietta, GA 30067. Phone: (800) 454-4598. Fax: (800) 982-1740. E-mail: email@example.com.