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Do EHM Solutions Match Problems and Potential?

by Scott MacStravic

When proactive health management (PHM) efforts began in the 1970s, primarily with worksite wellness programs for employers, they mainly dealt with the arenas of wellness, health promotion and risk reduction. When insurers joined in the 1990s, they focused mainly on disease management (DM). Currently, employee health management (EHM) increasingly combines all these domains into comprehensive efforts, either operated by the employer, or often with multiple EHM suppliers, for risk assessments, specific screenings, lifestyle interventions, etc.

When EHM began, it focused primarily, often exclusively on reducing healthcare/insurance costs, with disability or workers compensation costs included in many cases. In recent years, a growing number of employers, at least those who evaluate their EHM investments, have included absenteeism, presenteeism, and worker productivity/performance (usually estimated, rather than objectively measured), as well, greatly increasing the economic impact of the challenges they identify and the financial gains they achieve.

The challenge in EHM assessments, planning, management, and evaluation is to match the problems and potential gains they identify with the particular EHM strategy and tactics they choose to invest in. Both the types of challenges and their numbers will vary in both the type and level of problems and potential, so the choices are complex. And logically speaking, employers may choose to invest only in those particular tactics and challenges that promise positive ROI, rather than being happy as long as the overall strategy yields positive results.

Among the problems and challenges to be considered are chronic diseases, risk behaviors, risk conditions, and productivity/performance impairment factors, which often overlap with the other categories, but not always. If chronic diseases are selected, particularly if only those patients with uncontrolled cases of these diseases or multiple diseases are selected, the overall number of employees (plus dependents and retirees, if desired) chosen is likely to be smallest. If risk behaviors and conditions are included, and certainly if impairment factors are included as well, the entire workforce may be targeted for participation in at least the assessment process.

Employer choices may vary depending on whether they expect and endure high levels of employee turnover or not. If so, they may choose to focus only on diseases, risk and impairment factors that promise to pay off within a year or two at most. Of course, they may also choose to focus on challenges that promise to reduce employee turnover, as well. When employers enjoy low turnover, they may focus on their entire workforce, or weed out those who intend to leave in the next year or two by simply asking them to indicate such intentions to a third party EHM supplier.

When EHM suppliers began offering solutions, most began with a “one-size-fits-all option, based on what they had decided delivered the best results with whatever challenges they took on. But as more have added close to a full range of challenges, they are increasingly offering a full range of different solutions, differing in intensity and cost to clients, as well as the particular challenges of individual diseases, risk or impairment factors, themselves.

A few employers offer employees choices as to which identified diseases, risk and impairment factors each may select, counting on advice by coaches in making such selection helping to ensure that they choose interventions that will yield good ROI for the employer as well. Since employees who choose their own intervention have been shown to do better in terms of active participation, lifestyle changes, and EHM success, letting them make the choices often works out well. Otherwise, as some already do, employers may vary the intensity and cost of the programs which different employees are eligible to join, in order to match the costs to the estimated/predicted potential gains for each individual.

The costs of EHM interventions vary over an enormous range, if we count examples already known in Medicare DM demonstration projects. Fifteen such projects involved DM fees that ranged from $80 to $444 per month, or $960 to $5328 per year! It is the programs that offer face visits, at the worksite for example, or depend on physician office visits elsewhere, that tend to be the most expensive, with phone coaching somewhat less so. Physicians and coaches that use group face or phone contacts can be somewhat less expensive than those who rely on one-to-one “visits”.

At the bottom end of the cost range are suppliers who rely on online communications, at least for participants who can be reached online, with mailed content substituting for those who are not online. Perhaps the least expensive options involve participant-initiated website visits, though these may also be prompted via e-mail reminders at little added costs. Online supplier-initiated contacts are more common and more effective, usually, particularly when they are customized for each participant, which can be done via automated computer analysis of health risk assessment (HRA) results.

When chronic diseases are involved, particularly those patients with uncontrolled or multiple costly conditions, high-intensity options may make sense, since the potential financial gains are likely to be great enough. With risk behaviors and conditions, and some though not all impairment factors, lower-intensity alternatives often make more sense, because potential gains are lower. Almost every employee, however, is likely to have at least one item on the list of chronic diseases, risk or impairment conditions or behaviors, so having a mix of interventions that vary by intensity/costs makes the most sense.

This reality has been recognized by EHM suppliers. Many have merged with or acquired rival suppliers, in order to expand the scope of their interventions, and often to expand the intensity/cost range they represent as well. Those that started at the high end of both have added options at the lower end, while those that started at the low end have added options at the high end, to deal with recalcitrant individuals or complex and difficult challenges, including mixes of diseases, risk and impairment factors.

Suppliers almost always offer multiple separate interventions, and limit their simultaneous use to as few as one at a time, and no higher than two or three to my knowledge, at least. Clearly, since participation takes time, few employers wish to lose productive time for employees because they are spending hours every week participating in multiple interventions. Of course, some interventions are multi-faceted in the first place, as with diabetes DM, which almost always includes attention to reducing blood pressure and cholesterol, not merely blood sugar levels among participants.

Whenever productivity/performance impairment is an explicit element of EHM, it is likely that challenges addressed will represent different priorities than they do when only healthcare, workers compensation or disability expenditures are considered. For example, challenges such as lack of sleep, poor diet and fitness levels, and particularly chronic pain can be major causes of impairment and lost labor costs or gains, where they may cause modest, even low levels of healthcare expense.

Moreover, at least one EHM supplier has reported productivity recovery of as much as 8.72% for each participant in a back pain program, which would equal to at least $4360 in financial gains with employees who make at least $50,000 a year. While such savings may arise in DM with uncontrolled or multiple diseases, they may not always arise for every participant, witness disappointing results for Medicare’s demonstrations. By contrast, $4360 would more than cover the costs of most EHM providers’ interventions, across the full range of intensity and fees. And since 15% of employees were found by this supplier to be affected by back pain, this gain represents a potential gain of $4360 x 15% = $654 for every person in the workforce, if all who are affected enroll in the intervention.

By estimating the potential financial gains against the predictable costs of EHM interventions, employers should be able to make the most informed investment decisions possible. Some challenges are very difficult to succeed in, for example, such as permanent weight loss and smoking cessation. Smoking cessation interventions often have success rates as low as 20% or so, which when combined with smoking rates of 21% (the U.S. adult average), means any gains per participant will translate into only 20% x 21% = 4.2% as much gain across the workforce.

Whether charges are based on the size of the workforce or total population, or on a per participant basis will also make a difference, of course. Charging per population may prove least expensive as long as high levels of participation are achieved, though this may require paying incentives – per participant, or per successful participant – which will add to the costs per participant. Charging per population when low participation levels are achieved will result in significant multiplication of the population charge, i.e. by as much as ten or twenty times for 10% and 5% participation, though such fees may be so low to begin with, they are still a good investment, nevertheless.

By consciously and carefully attempting to match the predicted problem/potential of each EHM challenge with the total predicted costs of options being considered, employers can be as sure as it is possible to be, given the difficulty of predicting the future, that they are making the best investment. And as more employers become more careful investors, the suppliers of EHM services will be forced to offer, guarantee, and deliver better results in order to survive.

EHM Is Only Part of the Solution

by Scott MacStravic

As much as I am convinced that employee health management (EHM) is an essential element of business strategy for employers, as well as a way to improve the American economy, it is only part of the solution. If the only factor that employers address in order to reduce their labor costs and improve their workforce productivity and performance (WPP) is EHM, they will be missing much, perhaps most of the boat. Health, after all, is only one factor in determining WPP.

At a minimum, WPP, along with virtually all examples of human behavior, is a function of three main factors: motivation, capability, and consciousness levels related to specific behaviors. In a previous work, I described these three as a counterpart to Einstein’s Theory of Relativity’s use of the same initials, MC2. [S. MacStravic and G. Montrose Managing Health Care Demand Aspen 1998] While both motivation and capability have been discussed by colleagues in the domain of human capital management and are frequently cited by others in regard to WPP, all three are both essential, and can be managed.

Investigations of the reasons that workers, themselves cite for performing at less than their best tend to reflect a wide range of personal and family problems. A survey of 1826 workers in a variety of jobs and industries found that “personal health problems” ranked only sixth out of seven productivity impairment factors found, with 25% reporting being affected thereby at least some of the time. “Low motivation” was first, affecting 47% of workers “sometimes”, “frequently” or “all the time” – followed by low morale among co-workers at 41%, “poor communications” at 40%, not enough training 30%, personal issues 26% and family issues 22%. [W. Lynch & H. Gardner “Employee Health Problems Are Not the Greatest Threat to Worker Productivity” Health as Human Capital Foundation May 20, 2007]

Among the strongest single measures that predict motivation levels is the size of bonus for which employees are eligible, compared to the size of their salary, followed by employees’ perception that workers are recognized and rewarded for good work. Economic factors are also key with respect to absence and disability. Employers can reduce both by sharing with their workers unspent sick leave or personal time off in the form of extra days’ pay. Since such days presumably add to the employers’ benefit, and more than what workers are paid, paying a days pay for a days more work makes economic sense.

Sharing responsibility for disability in the same ways that employers are increasingly sharing it relative to healthcare costs is another option. Studies have shown that paying employees at or near 100% of their wages for disability days taken increases both the frequency of claims, and the duration of disability absences. By reducing disability payments to under 75% of wages, significant reductions in disability absences can be expected, in addition to reduced payments for disability leave. [W. Lynch & H. Gardner “A Hierarchy of Aligned Incentives” Health as Human Capital Foundation 2006 (www.hhcf.org)]

Motivation is most typically increased, often dramatically so, along with performance, by paying employees based on the work that they produce, both quantity and quality. This was dramatically illustrated by the Safelite windshield repair case where workers could virtually double their wages by increasing both, and productivity increased by 44% in just one year. [E. Lazear “Performance Pay and Productivity” American Economic Review 190:5 Dec 2000 1346-1361]

But motivation can be increased by other means as well, including recognition and training, with the latter also increasing capabilities. As the well-known “law of the hammer” illustrates, once people add a new skill or capability, they tend to use it, whether or not they are rewarded for doing so, merely because of the self-esteem and sense of accomplishment benefits they gain. But paying them more is usually expected, and justified when the new skill increases their performance and value to the employer.

Education, training, and support such as updated equipment, just-in-time delivery of or access to supplies and information needed to enable timely performance also help. And timely delivery of supplies and information can equally serve to prompt action by reminding employees that it is time to perform. Other forms of reminders, from posters on walls in workstations or bathrooms, for example, can serve to remind workers of appropriate actions to take, relative to their job, but also relative to their health.

The Eastman Chemical Co. in Kingsport, Tennessee, for example, provides posters in all its worker restrooms, 1200 in all, at its four manufacturing plants, reminding workers of health actions they should take, or unhealthy behaviors they should avoid. These are changed monthly to keep them from becoming so familiar that they are ignored.

When airlines first switched to container loading of freight, for example, workers often failed to fill those containers to capacity. This meant that airplanes flew carrying significantly less than their full capacity, and delivering less than full revenue to the airlines. By simply painting lines almost at the top of the containers, with the admonition “Fill to Here”, the proportion of containers completely filled increased from 45% to 95% virtually overnight. [K. Patterson, et al. Influencers: The Power to Change Anything McGraw Hill 2008]

The best way to optimize EHM results is first to ensure that its strategic and program elements include appropriate and proven ways to improve workers’ motivation, capability and consciousness relative what, where, when, how and why to engage in health management efforts, with communications customized to individual “whos” whenever possible. This same mix of elements should also be part of a comprehensive and integrated strategy to improve workers motivation, capability and consciousness relative to their productivity, performance, and contributions to the employers’ business goals and overall performance.

But equally important is that both EHM and integrated WPP efforts should pay attention to what employees, themselves, gain through improving their health and WPP. While many may take pride in achieving better health, productivity and performance, per se, virtually all will expect and deserve to see and appreciate what they are gaining as well. Employers that make sure workers are aware of and appreciate their own gains, can increase worker motivation, retention, and perhaps even save money on extrinsic rewards.

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 readings, with a Towers Perrin estimated cost savings of $706 for each employee affected
* Moving 27% of workers from high- to low-risk for cholesterol level, with estimated savings of $492 per worker
* Sedentary Lifestyle risk down by 16%, with savings of $738 per affected worker
* Body Mass Index risk down 11%, with estimated savings of $1295 per worker.

Instead of estimating productivity impacts based on employee self-reports of their own productivity levels, Sutter uses research-generated correlations between specific types and numbers of health risk reductions and productivity levels. Combined with biometric verification of changes in risks, this enables an objective basis for gauging productivity improvements, rather than the often overstated levels of productivity impairment and improvement that employees have been known to report. [G. Pransky, et al. “Performance Decrements Resulting from Illness in the Workplace” JOEM 47:1 Jan 2005 34-40]

While onsite coaching adds to EHM costs, Sutter Health Partners’ CEO and Sutter VP for Business Development Margaret Sabin argues that it is more effective as well. She reports that participants who have been involved in other kinds of EHM communications say that other methods are nowhere near as beneficial and effective. Participants cite the coaching 10% more often than they do the up to $500 per year incentives available as the reason they have changed to healthier behaviors. (phone interview on Oct 29, 2007)

Like most EHM programs, Sutter’s Live Well for Life efforts focus mainly on weight, stress, and risk management, along with physical activity and nutrition as key elements in a healthier lifestyle. They empower each participant to formulate reasonable and sustainable personal health goals, and support them with coaching via personal onsite visits, as well as online and phone interactions, combined into at least six 20-minute contacts over five months, in addition to participants’ self-directed learning and behaviors.

Sutter charges for its HRA and biometric assessment efforts on a per employee basis, then for its coaching and classes on a per participant basis. This minimizes the cascading effect of per employee charges, which multiply costs per employee by the inverse of the participation rate, e.g. doubling them at 50% participation, quintupling them at 20%. Sutter also reports that its clients achieve from 60 to 80% participation, meaning they get far more out of the program than do employers who only achieve 10-30%, which is more like the average for employee participation in wellness programs.

In addition to saving employers money on total labor costs, the Sutter program helps strengthen, and even initiate good employer relations, with examples of new business for Sutter Health medical and hospital care arising thanks to relationships begun with Sutter Health Partners relationships. And Sutter has been offering its own employees the same program for many years, realizing savings similar to those its employer clients enjoy. While there will always be a degree of conflict between the financial interests of sickcare services and EHM, there are equally solid common interests in terms of both internal EHM applications and the improved relationships with employers it makes possible.

Are There Any Consumer-Health-Centered Sellers Out There?

by Scott MacStravic

I have been struck for some time by how low the level of true “customer-centricism” is in the U.S. Having only visited and never for very long other countries, I don’t know if it is worse or better elsewhere, but it strikes me as pretty bad. Among the examples that bother practically everyone, I imagine, are the plastic-wrapped packages that can’t be opened without serious tools. These include those deliberately oversized (compared to their contents) plastic packs that are intended, I suppose, to prevent anyone from stealing the contents and pocketing them in the store, while making them too big to hide easily as a package.

I don’t object to the security required in self-service stores, especially given how much stuff I buy at Costco, but isn’t there some way to make packages in general openable by ordinary folks who keep saws, hatchets, and similar devices in their garages, rather than in the house? I also have a pet peeve about which I may be a minority, relative to the otherwise pure “blessing” of being able to access an incredible variety of printed material online, and print most of it when worth keeping.

Some website protect against printing their content, leading me to suspect there is something shady about their operations. Amazon.com does not enable its website visitors to print excerpts of books that it makes available for reading, but that is perhaps understandable, and it is otherwise a major source for me, about books that I do not buy, as well as for books, DVDs, etc. that I do buy. But it is relative to the way things have changed with respect to “printer-friendly” versions of content that bothers me most.

It has always been essential, for me or anyone wishing to limit the amount of paper and ink they waste making copies of online material to click on the “printer-friendly” version of most material, which is usually seriously encumbered as well as expanded with irrelevant content, such as advertising, which in some cases goes on for pages. Forbes magazine online articles, for example, seem to almost always have at least three pages of pap after the articles of interest, and do not normally offer a printer-friendly version, so waste a lot of my ink and paper, whenever I copy them, though fortunately the “print preview” capability enables me to avoid printing stuff that is totally irrelevant.

But where once the “printer-friendly” versions of content were nothing but printed words, and filled the whole page, thereby minimizing the waste of both paper and ink, now more and more retain one or more ads from their “printer unfriendly” original version, and often are printed so as to use only half or one-third of the page horizontally. Since I print literally hundreds of pages of such articles every day, this is definitely not “customer-centric” to me. And if there are others like me who do the same with their computer at work, is must be costing employers a lot as well.

In the UK, there has long been a concerted effort toward “buyer-centric” interaction and transaction processes, in sharp contrast to the “seller-centric” norm, where caveat emptor = buyer beware is the maxim written in stone. Thanks to the growth of “buyer agents” there, among other “concierge services” providers, and to government efforts to push buyer-centricity on sellers, there are chances for consumers there to control how much information they have to give to sellers, control how much information sellers bother them with, and force many sellers to operate as if they really are “buyer advocates”.

There is at least the notion of “customer advocacy” in the US, as well, but it is a dimension on which most sellers here would score poorly. There is a formal scoring mechanism, based on where a seller is perceived on a scale from “Acts in its own interests, even at the expense of its’ customers’ interests.” To “Acts in its customers’ interests even at the expense of its own”. Almost all sellers rated thus far fall well below the mid-point of this scale, where there would be a perceived balance between the two interests, and sellers rated toward the “customer-centric” end are rare, indeed. [[B. Doyle “Customer Advocacy 2006: How Consumers Rate Their Banks, Brokerages, and Insurers” Forrester Research Business View Trends May 22, 2006]

In theory, those engaged in enterprises that deal with the health of consumers should be a bit more customer-centric than those dealing with “mere” entertainment, transportation, etc. But the “healthy food” industry clearly has far to go. It seems to focus on using consumer health as a basis for stressing the only dimension of its products on which they could possibly be labeled as healthy, while ignoring the many other dimensions on which its products are unhealthy.

As employers, for example, seek to fill their cafeteria menus and snack vending machines with “healthy alternatives”, they will get little help from the snack industry. If there is any way they can mislead consumers about how healthy their snacks are, they seem to find it. Many “enrich” their snacks with vitamins, for example, or whole grains, omega-3 fatty acids, etc., while ignoring the generally poor nutritional balance they contain. Eating lower-fat foods that are loaded with calories, sugar, preservatives, etc. is unlikely to help a lot. Yet, rather than devise healthy foods that also are tasty enough to compete with junk, sellers often seem to prefer the “quick fix” of adding something that can be called healthy, with no FDA oversight, naturally, but with no significant change made to the original junk.

“Veggie chips” for example, may sound like they’ve got to be better than notoriously unhealthy potato chips, but they are usually nothing but potato chips dyed with vegetable-based coloring. Putting vitamins in sodas and flavored water will do few people much good if they encourage higher intake of sugar. There are some exceptions, fortunately – fortifying orange juice with calcium plus vitamin D makes sense, since vitamin D helps in the absorption of calcium, which, otherwise, might not do any good. Kraft Foods has labeled its truly healthy foods with a “Sensible Solutions” flag, so consumers can see immediately which products are high in nutrients, low in calories, salt, or sugar, for example.

But while employers, insurers, government agencies (lawmakers and regulators seem to much influenced by lobbyists) and consumer advocacy organizations are jumping on the bandwagon of population health management, as the one essential part of any solution to the “health care” and “uninsured” crises. But the food/drink industry is clearly not included. Most restaurants/fast food purveyors seem committed to their own interests well ahead of consumers’, with respect to labeling the content of foods, for example, as well as being among the least likely businesses to provide meaningful health benefits for their employees.

It can only be hoped, it seems to me, that competition will force more sellers into offering healthier alternatives to products and services that threaten consumers’ health. The good examples of some sellers will not be enough until and unless consumers demand and actually buy healthier alternatives. A recent US Department of Agriculture report sees hope in such competition, at least, though the Department has long been in the seller-centric camp in favoring the agricultural producers and sellers over consumers, but now sees marketing opportunities on the healthy side. [M. Cohn “Enriched Pitch” Jan 10, 2008]

It may be that as employers improve the healthiness of the food and snacks they buy for their employees, including food prepared for take-home by employees and used in feeding their families, that will be enough to move sellers toward the healthy, consumer-advocate and of the spectrum. Most sellers have demonstrated their general preference for fooling consumers to aiding them in pursuing good health, but if consumers and employers ally and align in efforts to improve health and reduce obesity in particular, something may come of it.

Is Obesity a Disease or a Lifestyle Choice?

by Scott MacStravic

There has long been a major difference of opinion about whether obesity is a serious health problem/risk factor/productivity impairment factor that should be the target of a major cooperative effort to eradicate, or merely a lifestyle choice that many people knowingly make, who should be left alone. The latest salvo in this “war” over the issue appears to be a book by health economists Eric Finkelstein and Laurie Zuckerman called “The Fattening of America” (Wiley Jan 2008).

The authors comes down hard on manufacturers, retailers and parents who push unhealthy and fattening food and drink on children, since they lack the knowledge and judgment needed to make a choice between obesity and normal weight, and will suffer a lifetime for even early obesity. But he also notes that “…the nasty side effects of obesity aren’t as nasty as they used to be. When you have a first-rate medical system that can cure the diseases that obesity promotes, you no longer need to worry so much about being obese.” [K. ZeitVogel “Obesity Now a ‘Lfestyle Choice’ for Americans, Expert Says” Yahoo! News Jan 10, 2008 (news.yahoo,com)]

It is clear that there are many to whom obesity is a kind of lifestyle choice, and there are a host of gurus, oversize clothing retailers, and champions of the oppressed who support the idea. On the other hand, there is also a growing body of evidence indicating that many of the causes of obesity are genetic, and people with genetic pre-disposition, “lazy metabolism”, and food “addictions” can’t make a choice, at all, in the free sense this usually entails.

On the one hand, an epidemic of healthy weight would cause serious problems for may sectors of the economy, such as sugary-drink and fattening/hyper-caloried/oversized portion food manufacturers and purveyors. But the American economy as a whole would be far better off, since obesity is a major cause or at least promoter of sickness care costs, worker absences and impairment at work. And like many lifestyle choices that are arguably “constitutional rights” of people to make, obesity forces healthy people to subsidize those who choose obesity, in both labor performance and sickness care costs.

Obesity is perhaps most hard on those who actually do choose it, as well as those with less than full choice in the matter. It creates early social problems as fat kids either tend to become bullies in order to turn their weight problem into a power advantage, or become ostracized because they don’t look right. Fat kids also tend to become fat adults, and the latter suffer handicaps in getting jobs and getting paid enough for them, as well as in penalties being imposed on them by employers or difficulties and penalties in trying to get individual insurance.

Still, the “issue” of whether it is a lifestyle choice or a problem is not really an issue. It is clearly both. There are many who have no choice, but the majority of those of us who are overweight/obese, including me, become burdened by excess weight because they enjoy the process of the eating/drinking and low exercise habits that promotes it, even if they are less than thrilled about the outcomes thereof. Fortunately, there is good evidence that when offered sufficient incentives, they can often lose weight and keep it off, though it is usually keeping it off that represents the greater challenge.

As long as obesity is a major promoter of significantly higher sickness care costs, it will inevitably be the target of all stakeholders in the “healthcare” system, at least, for “reform”, “prevention”, and similar efforts to reduce its incidence and prevalence, as if it were a disease. On the other hand, it is also clear that it is not a disease in the sense that it has to seek a medical or surgical solution, even though medications and bariatric surgery have proven to be effective. Even bariatric surgery, for example, requires lifetime lifestyle changes in order to keep its benefit continuous rather than transitory.

As long as it is economically advantageous for food and drink sellers to market their fattening products to consumers, they will no doubt continue to do so – as their “constitutional right”. And as long as people continue to prefer the lifestyle “strategies” that lead to obesity over those that lead to healthy weight, there will continue to be a market for these sellers. But as long as obesity functions as significantly as it does to promote chronic diseases and risk condtions, as well as productivity and performance impairment and higher costs of workforces, there will be plenty of stakeholders who will strive to prevent, reform, and otherwise reduce (pardon the pun) the incidence and prevalence.

The fact that a “philosopher” or even “economist” argument can be made about how we value and treat people who are obese does not alter the essential facts about the problem of obesity. Even if people knowingly and willingly choose to be obese, the effects of that choice create so much damage to others, as well as to those who choose, themselves, that like smoking and violence, the fact that many choose it will not cause it to be a generally accepted option. It will be treated as an economic problem, even if we manage to reduce the social stigma associated with it, for those who truly do not have a choice. Ideally, as more of us seek to eradicate or at least minimize the problem, already a major economy of its own, we will get a lot better at it.

Price Competition Comes to Hospitals!

by Scott MacStravic

A recently published story in Wichita, Kansas describes how its local Galichia Heart Hospital will begin charging a flat fee of $10,000 for coronary artery bypass graft (CABG) surgery for patients where there is little chance of complications. Patients with risky co-morbidities, such as diabetes, or who have had this surgery before, are not eligible for this price.

Since the usual and customary fees for CABG surgery run in the $35,000 range, this is a major example of price cutting by a hospital. With growing numbers of consumers covered by high-deductible insurance and using their own health savings accounts, this should be a welcome option. It might even help stem the flow of patients overseas for this surgery, given the added costs of flying to India, Thailand, or Brazil.

It is also the first of what may be many shots across general hospitals’ bows from free-standing specialty hospitals in the battle to win the lion’s share of this usually very profitable service line. And with roughly five tenths of one percent of the population looking for this surgery each year, this is a big market to gain a share of. The hospital has admitted its intention to capture the attention of insurers, as well as consumers, with this low price.

Surgeons at Galichia perform about 200 CABG procedures a year, and hope to increase that to 300, according to its CEO. The two major general hospital systems in Wichita – Via Christi Regional Medical Center and Wesley Medical Center enjoy most exclusive contracts with insurers, including Via Christ-owned Preferred Health Systems and Blue Cross/Blue Shield of Kansas.

The $10,000 rate is better than any of the local general hospitals’ rates, according to Galichia’s CEO, so this dramatically lower rate may win some converts, at least when current exclusive contracts reach their renewal dates. It is unclear how much such a lower fee might change physician referral patterns, particularly to other physician-owned facilities, but it might attract business at quite a distance.

Galichia is running ads in Canada and the UK, for example, where long waits for such surgery tend to be common, in competition with other “foreign” countries already advertising similar savings and immediate service. Timely Medical Alternatives and North American Surgery founder Rick Baker in Canada is quoted as saying that “The price…is absolutely stunning.” His firms connect patients with specialty hospitals that perform surgeries at low, contracted rates.

With such a low price in the US, it seems at least possible that other hospitals may have to rethink their charges, or lose considerable business to those who have done or will do so in response to their rivals. It might at least prompt some efforts by insurers and patients to seek to negotiate new rates with hospitals they already do business with. [A. Atwater “Galichia Heart Hospital’s $10k Bypass Jolts Industry” Wichita Eagle Feb 24, 2008]

British Example May Sink Single Payer Idea in the US

by Scott MacStravic

As with so many political issues in this country, there tends to be a polarization between those who favor a single-payer “socialized medicine” approach, such as the UK’s National Health Service, and those who favor a “free market solution”. The trouble with such polarization, of course, is that it disguises the fact that the best answer may be some combination of the two, or at least somewhere between the poles.

A recent example of what would probably seem an outrageous policy adopted by the British National Health Service may be deemed a reason to condemn the socialized medicine idea, even though it is not essential to the single-payer idea. A woman who had metastasized breast cancer had been refused coverage by the NHS of a drug (Avastatin) that has been approved for use in Europe, though not yet in the US. She decided to pay the $120,000 costs of the drug herself, while getting the rest of necessary and covered services under the NHS.

But NHS officials decided that belonging to the national program included a “loyalty” obligation, where patients, in any single episode of care for a particular disease, cannot both get government payment and use personal or other non-governmental funds. When she was denied, the patient went to the news media, as did other patients in similar situations. It came out that patients had been routinely supplementing NHS payments with their own funds to pay for some parts of their treatment that NHS would not cover.

A physician who is a member of Doctors for Reform, a group highly critical of NHS, argued that patients switch from public to private sector healthcare all the time, e.g. if on a long waiting list to see an orthopedist, paying an extra fee to be seen immediately, then using the NHS to cover the surgery required. Patients have had to pay out-of-pocket to get a second opinions before choosing treatment for cancer. They may pay thousands out-of-pocket to get a hearing aid rather than wait a year to get one free from NHS.

Patients’ paying for some of the care they need and want is a common part of cancer care, according to another physician, when providers consider some drugs or treatments too expensive. This may require that patients go to another physician to get the drug, destroying continuity, but is essential when the NHS favors less expensive options, as governments tend to do.

There is already a great deal of variation in what patients can expect from NHS depending on where they live in the UK. Wide variations in waiting lists for seeing physicians and getting treatment are common, as are variations in which drugs will be available. Other patients at the same hospital as the breast cancer patients had been augmenting NHS treatments with self-paid options. NHS has argued that any drugs purchased by patients must be administered at a different visit from those paid for by the government, yet the particular drug in this case has to be administered together with one that is covered.

After being denied, the patients’ condition deteriorated to the point where the controversial drug could be paid for by NHS after all, so she is happy about that, but understandably unhappy at the extended wait and the possibility that her chances of cure and survival were diminished thereby. If the delay has reduced her chances, she feels the government should “be raked over the coals for it.” [S. Lyall “Paying Patients Test British Health Care System” New York Times Feb 21, 2008]

It seems unlikely to me that even a government-financed single-payer system in this country would be allowed to deprive individuals of the right to choose to pay for additional or alternative treatments, or accommodations, access, and amenities, for that matter. But those who favor a “market solution” may well use this example (which may well result in the overturning of the announced NHS policy, given the outcry that it produced) as an argument against a polar opposite “straw man, when a more pragmatic rather than political solution should probably be preferred anyway.

China’s Doctors Continue to Experience Patient Violence

by Fred Fortin

I’ve written before on the growing concern over violence between patients and medical workers in China. Now Xinhua, China’s official news agency, reports on the results of a new survey of doctors co-sponsored by the China Youth Daily and Dingxiangyuan, a Chinese online medical forum. The press analysis of this study — some cautioned may be warranted here — includes some disturbing findings:

  • Some 60 percent of China’s doctors have personally experienced, or have seen their colleagues subjected to, on-the-job violence from patients or their families;
  • Of the 4,353 respondents, all of whom were medical practitioners aged between 25-45, 40 percent admitted to being under severe stress and “sometimes on the verge of a breakdown.” This was not because of career or financial concerns but because of suspicion and mistrust from patients and the public;
  • Some 63 percent of the respondents said that they felt their health had deteriorated and 54 percent had never exercised in the past six months due to long working hours; and
  • More than half of the respondents said that they had considered leaving medicine and about 36 percent said they were still considering the idea.

China’s health care system needs to bring some institutionalize response to the plight of its medical practitioners. This has to take the form of a more organized social and economic mediation effort that can absorb some of the enormous tension now burdening Chinese health care. Some officials recognize that there could be a positive future role for malpractice insurers and private health plans in helping to mitigate these types of disputes which frequency escalate into broader social instability. Let’s hope that the reported emerging health care reform measures begin to address this increasingly worrisome problem.

Beating Recruitment & Retention Challenges of The Silver Tsunami

by Nick Jacobs

Eleven years ago our hospital was confronted with what seemed to be an overwhelming situation. We had a rotating door as employees came to our medical center, finished their certifications and left to work for the three hospitals near us that had higher pay scales.

Employee morale was very low and the employee turn over rate was extremely high. Our first decision was to become a Planetree Hospital, and worked to become the employer of choice for our region.

We began by meeting individually with each and every employee. The result was simple; pay attention to their concerns, their fears, their needs and their dreams. We immediately instituted an administrative Open Door Policy, produced a regular and now web based Newsletter, monthly Birthday Pizza with the President State of the Hospital meetings, quarterly Town Hall Meetings, a recognition program entitled Caught You Caring and a senior leadership policy of Management by Wandering Around.

Then we did something very dramatic. We made arrangements for 37 employees and 11 highly qualified physicians to LEAVE because they were bullies. Bullies have not been tolerated at this facility for over ten years, and our medical staff ensures that they will never again be accepted here.

We began to pay attention to our employees’ health needs by offering them the following programs: an Osteoporosis Program, Smoking Cessation, Eat Well for Life with personal nutrition counseling, StrengthTraining, Cardiac Rehab and Dean Ornish Coronary Artery Disease Reversal Program. We also offered Healthy Choice Meals (fat and trans fat free vegetarian) and Healthy Vending Machine selections.

Then we added staff members to offer the following to our patients, staff and volunteers: pet, aroma and music therapy, acupuncture, drumming and massage. We built walking trails, labyrinths, and made available a ten dollar a month payroll deductible admission to our workout facility for all employees and physicians. Included are classes in aerobics, water aerobics, yoga, tai chi, ai chi, spin classes, kick boxing and added over seventy pieces of workout equipment, an exercise pool and a walking track.

On the personal side we took away sick, personal and vacation days and gave back in a block that gave the employees freedom to use their time as personal time. We also permitted our employees to donate PTO days for their fellow employees in their time of need and offered additional grieving time for the loss of in-laws and grandchildren as well.

We added fresh flowers from our own greenhouse, a relaxation room, healing gardens, gazebos, counselors and clergy. We began baking bread on each floor, carefully placed artwork and decorative fountains throughout the campus. We also placed a popcorn machine in the main lobby. Just for good measure we added skylights, plants, fish tanks and two functional fireplaces. During times of extreme patient activity we began having ice cream socials, special pizza and grinder’s days. We now provide a trip to a professional baseball game, tickets to the symphony, the opera, local theater, hockey games, and plenty of fund raising dinners.

Finally, we enhanced our employee recognition dinner, initiated a hospital week cookout and put thousands of extra dollars into a holiday party. We increased our training and input into the employee assistance program, stress reduction classes, DisneyTraining, EQ2/Emotional Quotient training, Planetree and Dale Carnegie training programs.

This work has resulted in nearly a tripling of our business, our infection rate is below one percent and our length of stay is approximately 3.4 days as opposed to the 4.6 days that is the norm for hospitals our size. Oh, yeah, and the new low turnover rate . . . Priceless.

If you would like your organization to stabilize and to improve morale with your employees and physicians while growing the satisfaction of your patients, just follow the road map above.

Is CMS the Enemy of Disease Management?

by Scott MacStravic

In some ways, CMS in general, and Medicare in particular, have been major supporters of disease management (DM), sponsoring a large number of demonstration projects involving large numbers of DM providers and large populations of beneficiaries. They have thus gained the ability to learn more about the narrow application of DM to insured populations, narrowed still further by being Medicare beneficiaries, who tend to be seniors and to be far more likely to have multiple chronic conditions, as well as to have had them longer than is the case with employee populations.

Medicare’s limited focus is fully understandable if it sees itself as only a payer for seniors’ chronic-disease-caused medical, hospital and pharmaceutical expenses. As an arm of the federal government, however, it might also see itself, at least partly, as the source of information and insights that can guide improvements in DM, in general, and its use by DM providers, and payment by other payers, including commercial insurers and employers, as well as for consumers, who have much to gain from the best DM practices and providers.

In this latter role, CMS has failed utterly. For one thing, it has defined its role as that of determining whether or not DM works, as a generic method for a single purpose, namely saving the government money. As noted in a recent analysis of CMS’s decision in its Medicare Health Support (MHS) demonstration, the only reports on this program issued by CMS have simply mentioned that it failed to achieve the financial goals set for the program. [“MHS in Jeopardy: Part 1” Health Leaders Media Audio Feature Feb 20, 2008]

While this program has been running for 2-1/2 years, the only information that CMS has shared was that in a lengthy preliminary report on six months’ experience, which indicated that financial results at that point had not met CMS expectations. This was an overall conclusion, however, and based on the financial results alone, rather than reflecting quality of care and patient satisfaction improvements, that were supposed to also be included in its criteria for success. When CMS recently announced that the entire project will be terminated after “Phase 1”, with no “Phase 2” envisioned, it supplied no additional data on achievements in the most recent two years, nor about anything about the specific performance dimensions not achieved, merely that : “…Phase 1 of the program is not meeting statutory requirements.” [“Fact Sheet: Completion of Phase I of Medicare Health Support Program” Medicare/CMS]

It did include the statement that: “The CMS will determine whether to expand the pilot into Phase II if the results of the independent evaluation indicate that any {emphasis mine} of the programs (or program components) meet the conditions for expansion as specified in statute.” In other words, apparently neither CMS nor anyone else knows yet whether any of the individual DM programs and providers in the project succeeded, in which if any of the success dimensions, nor is there any information on what any of them achieved in the two years since the initial report came out. But CMS ended the project, nevertheless.

Considering the September announcement by the CMS Acting Administrator Kevin Weems promising a higher level of transparency and accountability at his agency, this is hardly an example of either from most observers’ perspective. [J. Young “New Medicare Chief Promises Accountability” TheHill.com Sep 12, 2007)] 68,000 beneficiaries will lose their support between July and December, with no explanation other than the terse “not meeting statutory requirements” comment, an no data backing up the comment at all, other than the first six months’ report.

On balance, i.e. over all eight MHS provider organizations, the six-month report was not positive, as far as financial savings were concerned. While savings were achieved, in terms of lower monthly costs for program participants vs. non-participant controls, when the management fee charged by the providers were included, none of them had achieved the 5% savings minimum set by CMS. In fact, two of them ended up adding to the total costs that Medicare had to pay for participants.

On the other hand, six of the eight had achieved net savings after their management fees were counted. One, in fact, saved a net 4%, though only two others achieved over 1%, namely 1.1% and 1.5%, while the others achieved only a fraction of 1%. This may be the “statutory requirement” that caused the negative decision about Phase I, though without data on the subsequent two years, it is impossible to tell whether similar results were achieved in the longer period. [N. McCall, et al. “Evaluation of Phase I of Medicare Health Support (Formerly Voluntary Chronic Care Improvement) Pilot Program Under Traditional Fee-for-Service Medicare” CMS/Medicare]

The MHS example is but one in a series of federal reports that have concluded that DM doesn’t work, where all have treated DM as if it were a single intervention form, rather than the widely varying forms that are, in reality, used by different suppliers thereof. There are far more than eight DM providers involved in the study, so the results only apply to their results, not to what others have achieved, or even what these same providers have achieved with other populations, payers, and requirements.

As one of the people speaking in the Health Leaders Media audio feature cited above argued, this is tantamount to the federal government testing a selection of eight drugs used for different patients and conditions, and making an overall judgment about the efficacy of all drugs used for all patients for all conditions. It is an absurd attempt on the face, and one that fails utterly to fulfill government’s role as a source of information that can help anyone.

If CMS had cited the data that caused them to reach their negative conclusion, and it showed that none of the eight providers involved had achieved any of the desired results, that would be one thing, but even then limited to these eight and this unique situation. Yet it adds to the already significant number of previous reports that condemn DM without mentioning the cases where it has worked even for CMS, among the different participants in its demonstrations.

Whether CMS has chosen to be an enemy of DM and its providers is unclear, but it is certainly behaving and reporting in a way that damages the hopes of chronic disease patients and DM providers, while apparently learning nothing useful in the process, for themselves, patients or providers. Shame on CMS!

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