Transcript Slide 1

Moving from Managing Cost
to Building a Culture of Health
Caroline Blouin, Head, Global Pensions & Benefits, RBC Financial Group
Wendy Poirier, Managing Principal, Health & Welfare, Towers Perrin
September 25, 2007
© 2007 Towers Perrin
Defining the challenge – and the opportunity
The fundamental quandary
How can employers address rising health care costs while still
meeting workforce effectiveness goals?
Fact
Cost-shifting has limits
Fact
Engaged consumers will utilize resources more effectively
Goal
Employers need integrated solutions to manage total spend so that
employers and employees both benefit
Challenge
Engaging employees requires greater alignment of employer and
employee interests which means revisiting the historical focus on
costs, overcoming a tradition of little or no cost transparency for
employees, a health care system in transition, and siloed approaches
to solutions
© 2007 Towers Perrin
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Defining the challenge – and the opportunity
How to align employer and employee interests?
HR needs to
Solution needs to
Fix the cost problem without negative
workforce consequences
Provide a comprehensive, yet
streamlined assessment of current
program performance
Engage employees in a broader value
proposition around health
Point toward specific actions and
opportunities for improvement
Demonstrate ROI on benefit programs
and related interventions
Make the connections between financial
performance, consumerism and workforce
health
Sharpen business disciplines around
benefit management overall
Build a meaningful line of sight for
employees
Allow for effective communication with
senior management
© 2007 Towers Perrin
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Defining the challenge – and the opportunity
 Increasing population health risks loom large for employers today – and
pose significant future threats
Incidence of diseases such as cancer, obesity, and high blood
pressure have increased by 25 to 70% over the last five years in
Canada
 Workforce trends will only exacerbate these health risks
An aging population consumes greater health services
Worker shortages increase pressure and stress on employees
 At current trend rates, health care costs could grow as high as 8% of
wages in the next 10 to 15 years
© 2007 Towers Perrin
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Defining the challenge – and the opportunity
Determinants of Health1
Access to
Care
10%
Genetics
20%
50%
Behavior
20%
Environment
1 Source:
IFTF, Centers for Disease Control and Prevention, Health and Health Care, 2010, The Forecast, The Challenge.
© 2007 Towers Perrin
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Defining the challenge – and the opportunity
 Employers are moving beyond cost management to creating a “culture of health”
 This approach shifts the focus of benefit management onto:
1) Employees:
– To be accountable for lifestyle and health care decisions
– To minimize their risk factors which can lead to ill health and disability
– Choose appropriate medical products and services and use them wisely
2) Employers:
– To provide support mechanisms such as real-time information,
effective providers and aligned plan design options/incentives
– To demonstrate "caring" about employee health and well-being
Creates a “win-win” for employees and employers in establishing and
maintaining a healthy and productive workforce
© 2007 Towers Perrin
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Polling Questions
 Do you have a formal process for monitoring key elements of the health
programs you offer?
 Does your senior management team demonstrate an attitude of caring
about employee wellbeing?
 Do you actively engage employees in becoming better health care
consumers?
© 2007 Towers Perrin
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Building a Culture of Health
Overall goal: A healthy organization
with efficient benefit programs, acceptable benefit costs
and a productive, engaged workforce
Metrics/Desired Outcomes
Financial Performance
The cost and value of programs are better
than competitive benchmarks and
meet corporate objectives
Consumerism/Engagement
Workforce Health
Employees use and understand benefits, tools and Programs are based on the company’s cost and
risk drivers and help influence health outcomes
resources and are ready for new solutions
and resource consumption
Strategic Levers
Strategy and
Governance
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Well-articulated
Defined metrics
Ongoing measurement
Links to business
Links to total
rewards
• Executive sponsorship
• Clear lines of
accountability
© 2007 Towers Perrin
Design
• Cost transparency
• Meaningful choice
• Aligned contributions
• Targeted incentives
Delivery
•
•
•
•
•
Change
Management
Financial
Aligned strategies
Superior customer
service
Innovative solutions
Effective claims
management
Ongoing review
Management
• Optimal funding and risk
level
• Appropriate pricing
• Favorable renewal
terms
• Annual financial and
budget review
• Annual benchmarking
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•
•
Leadership support
Ongoing communication
Wellness culture focus
Decision support tools
Employee accountability
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Building a Culture of Health: a framework to establish
goals and measure performance in three critical areas
Financial
Performance
Develop awareness of the cost and value of programs
and benchmark against other employers or corporate
objectives
Consumerism
Look at how employees consume benefits and health
care services, measure how well they understand
existing tools and resources, gauge how they see the
impact of their own actions and how ready they are to
change behaviour
Workforce
Health
© 2007 Towers Perrin
Identify your key cost and risk drivers in order to design
customized programs that help influence health
outcomes
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The strategic levers: Which elements are driving
current performance … and where to target change
Strategy and
Governance
The guiding principles and objectives of corporate health and
wellness programs, along with a specific plan to achieve
objectives and supporting metrics
Design
The program design plan provisions and financial strategy,
addressing appropriate choice, transparency, accountability
and employer/employee risk and cost sharing and incentives
Delivery
Delivery systems are key to successful deployment of health
strategies - both external delivery through vendor partners and
internal delivery through coordinated, aligned resources
Financial
Management
The financial mechanics, including goals for cost, trend and
efficiency, as well as funding and accounting practices
Change
Management
Key element to any successful initiative: demonstrated
commitment to health and well-being, evidenced through
leadership support, communication and environment
© 2007 Towers Perrin
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Building a Culture of Health: A Starting Point
 Make health a top priority
 Operationalize management’s interest in employee wellbeing
 Understand employee needs and desires and identify the main workforce health issues
 Demographics, drug utilization, absence/productivity statistics, engagement levels
 Deliver consistent programs – and messages – across the health management continuum from
prevention to managing ill health
 Equip employees to make the right choices
 Provide access to information and tools that allow them to make better health care choices –
proactively and at the point of care
 Deliver on the program promises
 Identify health “ambassadors” and cascade health initiatives from management to employees
 Build a vendor accountability model to monitor and influence vendor performance through
performance standards
 Engage senior leadership in health care solutions
 Be progressive, plan and take action on a sustained basis
© 2007 Towers Perrin
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September 2007
Moving from Managing Costs to Building a Culture of
Health
Wellness at RBC
Caroline Blouin, FSA, FCIA
Head of Global Pensions & Benefits
The Business Case
Benefit Spend in Canada
$185-million
Disability-related costs
$100-million
Health Plans
Supplemental Medical
Prescription Drugs
Dental
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The Business Case
Forecasted Benefit Spend in Canada
$350,000
$300,000
$250,000
$
(000)
$200,000
7%
15%
$150,000
$100,000
$50,000
$0
1
2
3
4
5
Years
14
6
7
8
9
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Step 1:
What is Wellness?
RBC promotes and supports a healthy and safe work
environment and encourages employees to lead a
healthy lifestyle.
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Step 2:
Assessing Risk and Readiness
Confidential
On-line
Employee Value
Personalized
wellness profile
$50 credit to HSA
RBC Value
Aggregate results
Risk
Readiness to
change
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Polling Question
Which risk factor would you anticipate to be highest for your organization?
a)
b)
c)
d)
e)
f)
Nutrition
Smoking
Physical activity
Overweight (BMI)
Alcohol
Stress
Which risk factor would you anticipate to have the highest readiness for change?
a)
b)
c)
d)
e)
f)
Nutrition
Smoking
Physical activity
Overweight (BMI)
Alcohol
Stress
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Wellness Assessment
Risk Factors
100
90
80
70
60
50
% 40
30
20
10
0
Overweight
Inactive
Poor diet
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Stressed
Wellness Assessment
Readiness to Change
100
90
80
70
60
50
% 40
30
20
10
0
Overweight
Inactive
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Poor diet
Wellness… the RBC Story
Awareness
Engagement
Incentives
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Awareness
Living Well Intranet Site On-line Wellness Resource
Health-related Information
Nutrition
Exercise
Stress Management
Featured Employees
Wellness Videos
Information and tips from
RBC Health Professionals
RBC Healthy Workplace
Employee Assistance Program
Work/Life Initiatives
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Awareness
Taking Action
Electronic bulletin
Event-driven
Direct links
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Polling Question
What types of initiatives, do you believe would
have the greatest impact?
a)
b)
c)
d)
On-site fitness facility
Fitness membership subsidy
Wellness/Personal Spending Accounts
Health and wellness campaigns
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Engagement
Partnership with the
RBC Olympians
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Engagement
Have you walked your 10,000
steps?
Living Well – Eating for Life!
Basics of healthy diet
Why fad diets don’t work
How small changes to your
diet can have a big impact on
your health
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Financial Incentives
Two ways to earn up to $80 in wellness credits:
Wellness Assessment = $20
Healthy Living Pledges = $60
To be physically active for a minimum of three times per
week, for at least 20 minutes each time
To eat at least one serving of fruits or vegetables at each
meal
To visit a health care practitioner for a general health
assessment this year
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Financial Incentives
10,881 employees completed the Wellness
Assessment
28,332 employees actively re-enrolled in the RBC
FlexBenefits program this year
Compared to 16,295 who enrolled in 2006
97% committed to all three Healthy Living Pledges
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What Are Employees Saying?
“This month, many of us enrolled in the Flex
Benefits plan and took notice of the discounts
offered for making a commitment to eating better,
exercising, and taking that annual trip to the doctor.
I raised the issue with my manager that we should
take action to make sure everyone remembers their
promises in the ensuing months. With his help, I
started a weekly program of Health and Wellness
which is incorporated into our Friday morning
meetings. It’s our hope that our efforts will translate
to a more focused and energetic work day for
everyone!”
~ Kathy Finstad, Senior Account Manager
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What Are Employees Saying?
“Our branch has created an internal fun group called "The
Belly Busters" who are meeting weekly to discuss our eating
and wellness regime. We are helping each other lose weight
and in the first week, 9 people shed a total of 12 lbs. To
encourage everyone to eat breakfast, we decided we would
pool our funds and buy a blender for the branch kitchen.
The sales force offered to award us a blender if we exceeded
certain targets for referrals. And so the rallying began and
we exceeded our weekly goal by 3! Since then, our "Belly
Busters” group are enjoying breakfast daily, and now the rest
of the team, are jumping on board.”
~Wendy McCartney, Branch Manager
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Looking ahead
Awareness
Engagement
Incentives
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Questions & Answers
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Polling Question
How interested are you in providing additional stressreducing financial benefits to your employees at no cost to
the company?
very interested
somewhat interested
not sure
not interested
Are you in agreement that facilitating financial security, in
addition to company-wide health initiatives, may result in
lower employee stress and health costs?
agree
somewhat agree
not sure
disagree
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For more information, contact:
Sponsored by: RBC Insurance
Wendy Poirier
[email protected]
Caroline Blouin
[email protected]
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