Business of Well-being

An Ounce of Prevention

An Ounce of Prevention

The belief in wellness programs is that if employees are well, they will have fewer needs for medical intervention. Employers that provide health insurance for their employees have more than likely realized the increasing cost of premiums. Since 2000, premiums have increased between eight and 14 percent per year, according to the Kaiser Family Foundation, and a current study by consulting firm Towers Perrin finds that average corporate health benefit expenditures in 2008 were $9,312 per employee, which is an increase of seven percent over 2007.

Kaiser also finds that premium increases have consistently outpaced inflation and the growth in worker's earnings. Year after year, the argument for an increase in the cost for health care seems to stay the same. Many providers tout that advances in medical technology, facilities and better drugs warrant higher costs. And although this may be a realization of the changing times (the expansion of new products and services to address a growing number of health problems), employers and their employees are sometimes faced with tough decisions on how they will afford health care.

The concept of employers providing health insurance is a relatively new occurrence. Since the WWII era, health care coverage has been something the American workforce has grown accustomed to. During the war, the federal government sought to control inflation and thus they limited the employer's freedom of being able to raise their workers' wages. However, employers could expand benefits, like health insurance, which has resulted in the increase of employer-sponsored insurance that still permeates today.

And since the federal government did not commit to sponsoring universal health coverage, they provided tax incentives to employers that made it available to their employees. So although it is not mandated by the federal government that employers provide health insurance, it is seen as a competitive way to recruit and retain employees. However, understanding the costs associated with providing health care today, employers are looking for ways to slow down their health care spending. They are finding that the cost of health insurance for employees outweighs the various tax credits, and this realization contributes to whether or not employers will sponsor health insurance.

There are competing solutions that have been proposed to address the skyrocketing cost of health care, such as government funded programs and mandating the use of more information technology practices like e-records for doctors and hospitals. Analysts say this would cut down on the costly paper trail currently in practice. However, implementing these kinds of advances have yet to be fully realized for a variety of reasons, including implementation cost and provider control. So some employers are trying to combat the current system by taking a new direction to their employer-sponsored health insurance programs and focusing on wellness initiatives such as disease prevention and health promotion for their employees.

And although health prevention concepts are not new, they are gaining momentum as a way to not only reduce health care costs but to improve productivity by, for example, reducing turnover and aiding in recruitment. The belief in the notion of wellness is that if employees are well, they will have fewer needs for medical intervention. This concept is important to the employer because for each member of their workforce that is well-that is has regular checkups and receives vaccinations and early treatment for diseases-research suggests that employers can reduce costs in a wide range of areas including group health, pharmacy services, behavioral health and disability, to name a few.

Furthermore, implementing health improvement programs contributes to better attendance and cost savings on recruitment and training; employers can realize significant ROI through proactive spending that promotes these ideas. Health Risk Assessments (HRAs) and biometric screenings have become popular over the years as a way for employers to encourage the well-being of their employees, but these are only the first steps in a well-designed wellness program. Employers have to be more directly involved in reducing their health care costs and can do this by promoting strategies such as health coaching and targeted lifestyle interventions for employees who are found to be at risk for disease, and altering the work environment to encourage enhanced physical activity and nutritional options.

All of these things can improve overall workplace productivity and safety. "Employers that are able to modify risk behaviors and efficiently treat high-risk conditions such as hypertension, diabetes, and cholesterol before they escalate could experience a significant cost reduction in their group health claims experience," says Dr. Amy Khan, Concentra's national director for Wellness TotalCare.

But sometimes these kinds of programs are not well received by employees. The Wall Street Journal recently conducted a poll on this issue and 65 percent of respondents believed that employers should not have the right to require their employees to go through wellness programs such as smoking cessation or weight loss clinics. The survey also noted that there is little support for charging employees higher premiums if they have unhealthy lifestyles.

"And although health prevention concepts are not new, they are gaining momentum as a way not only to reduce health care costs, but improve productivity."

These ideas seem to be based on privacy fears, and although there may be merit in such feelings, the under lining theme with starting any wellness program is for the employer to have an effective employee communications plan. Health has always been a sensitive topic for many people but with quality assurance measures in place, as well as employee feedback, employers can create an environment of workplace wellness support rather than a directorship that hurts more than helps. Offering incentives to employees that participate in these programs is also a way employers can gain support.

Furthermore, employers that tailor their health improvement plans to the overall corporate culture of the company will more than likely see the best participation and results for a healthier environment. The costs of health care will continue to reign supreme in the minds of employers and employees. Preventing illness and injury and promoting health and productivity will lower the total cost of health care. This idea is not the only solution but it is something that is sure to come into fruition as health care costs continue to rise.

Employers will become savvier in how they deal with these pressures and seek to utilize these cost-trimming measures to alleviate the strain on their bottom lines. David Blumenthal (2006). Employer-Sponsored Health Insurance in the United States - Origins and Implications. The New England Journal of Medicine, 355(1), 82-88. Retrieved December 13, 2007, from Research Library database. (Document ID: 1073426811).

About the Author

Maja Jurisic, M.D. is the Regional Medical Director for Concentra, overseeing all Concentra Medical Centers and worksite locations in Minnesota and Wisconsin. She also serves as a member of the Medical Expert Panel on Integrated Health, Wellness, and Productivity. She is an active member of the Occupational Medicine section of the Wisconsin Medical Society, where she serves on the Executive Council.

She was appointed by the State of Wisconsin to the Health Care Provider Advisory Committee to the Workers' Compensation Advisory Council. Prior to joining Concentra in 1991, she worked in emergency medicine for over eight years. Dr. Jurisic is a graduate of Marquette University and the University of Wisconsin in Madison. She completed her residency at Wright State University. She is Board Certified in both Emergency Medicine and Occupational Medicine.

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