home email us! sindicaci;ón

More Integrated Systems Investing In EHM

by Scott MacStravic

Employee health management (EHM) has always been a logical arena for investment by healthcare organizations (HCOs) of all kinds, since they are employers facing a constant and worsening labor shortage and high labor costs. By protecting and improving the health of their workforces, HCOs can not only reduce their health, workers compensation, and disability insurance costs, but increase worker productivity and performance. And as more of their revenue becomes dependent on their overall performance, the more they can improve their workforce performance, the better their revenue situation will be, in addition to their cost situation.

There is, of course, the problem that EHM derives part of the savings it generates by reducing the incidence and prevalence of disease and injury, and thereby, the use and expenditures for “sickcare”, upon which HCOs depend for the vast majority of their revenue. So while offering EHM to their own employees makes eminently good sense, offering it to other employers would seem to be directly counter to HCOs’ financial interests.

But there are many, and an increasing number of HCOs whose missions and visions for their future recognize that preventing disease and injury is in the best interests of the communities they serve, and may be in their best long-range interests, as well. With all payers for sickcare services looking for ways to dramatically reduce their payment obligations, it is clear that sickcare is not in the “best of health” as a future market, while healthcare, in its truest sense, certainly is. If HCOs do not join in the general move to proactive management of health, it will likely become only a bystander and victim of others doing so.

It is certain that in the most optimistic of scenarios for the future, sickcare will continue to be needed. But if the volume and intensity of sickcare utilization and expenditures can be significantly reduced, then payers will be able to afford being at least about as generous as they are now in paying for it. If not, and particularly if payers become widespread and heavy purchasers of healthcare instead, HCOs that depend solely on sickcare revenue may be in serious trouble. Already prestigious HCOs such as the Mayo Clinic are significantly engaged in EHM, with Mayo serving 70 or so employers in the US with its proactive health management services.

Sutter Health, an integrated health system of 29 hospitals plus medical practice affiliates such as the Palo Alto Medical Foundation, has been engaged in EHM for both its own 41,000 employees and employers in its markets, beginning in 2001. More recently, it developed Sutter Health Partners as a separate division responsible for employer-focused EHM services as both a revenue-generating and employer relationship management (ERM) strategy. It offers a “Live Well for Life” program to employers in the Northern California market where it operates, using the same double entendre meaning of “for life” as I did as the Chief Marketing Officer for Provenant Health Partners in Denver, where we developed the tagline “Your Partner for Life.”

Sutter offers customized turnkey EHM programs to area employers, based on onsite convenience. The programs include onsite biometric screening tests to assess and evaluate progress among participating employees, in addition to an online health risk assessment survey. Personal coaching, including a personal meeting with the coach assigned to each participant, and ongoing meetings at least quarterly thereafter, are offered along with wellness topic and exercise classes at the worksite for participants’ convenience, as well as the high personalization possible through face meetings.

Coaching, support and monitoring communications are also carried out online and by phone to supplement onsite meetings. Based on an average annual employee compensation of $40,000 a year, fairly low among employers who invest in EHM, including Sutter, itself, Towers Perrin has predicted first-year savings for employers of almost $1000 per participant in the EHM program, of which over three-quarters are in absenteeism, disability and presenteeism cost reductions, with less than one-quarter in medical/sickcare costs. [“What LIVE WELL FOR LIFE Can Do for You” SutterHealthPartners.com]

Moreover, these savings are predicted to increase each year thereafter, from $1000 to $1700 per participant per year, adjusted for inflation. Cumulative savings per participant over that period would be over $3500 per participant in medical/sickcare costs alone, and more than three times as much in total cost savings over ten years. For employers with higher average annual compensation per employee, or where the value of employees is greater than their annual compensation, total positive economic impact would be that much greater.

The Sutter program combines assessment, coaching interventions that motivate and support employee health behavior change, with measurement of results and return on investment. Sutter has reported results such as:

* Moving 25% of workers from high- to low-risk status with respect to blood pressure