Transcript Slide 1

June 18-19, 2009
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Hyatt Regency Chicago
Human Capitol Metrics of Success:
Case Studies of ROI Models across
Industry Type and Size
John Vlajkovic
Senior Health Care Consultant; Principal
Hewitt Associates
Agenda
–Market Dynamics
–Conflicting Perspective
–The Key Is Measurement
–Sample Analyses
Can’t Ignore the Financial Burden
Annual Health Care Costs
per Employee
Annual Employee Contributions
and Out-of-Pocket Costs
• Health Care Costs Double in Seven Years
$9,000
$8,676
$4,000
$7,982
$8,000
$3,500
$7,583
$7,025
$7,000
$6,435
$3,000
$1,735
$5,728
$6,000
$2,500
$4,993
$5,000
$1,576
$1,458
$4,336
$2,000
$1,311
$4,000
$1,116
$1,500
$940
$3,000
$777
$1,000
$2,000
$500
$1,000
$661
$659
$791
$969
$1,158
$1,302
$1,472
2005
2006
$1,690
$1,859
2007
2008
$0
$0
2001
2002
2003
2004
2005
2006
2007
2008
2001
2002
2003
Average Employee Contribution
100% Increase
Source: Hewitt Health Value Initiative™ (HHVI™)
2004
Average Employee Out-of-Pocket Costs
172% Increase
The Economic Collapse Adds to the Problem
The Conference Board’s CEO Challenge 2008
– Original 2008 survey completed July/August (pre-financial crisis)
• Conference Board did a re-survey in September/October
– With regard to people-related challenges, only two items became a
higher priority in the re-survey
• Cost of employee health care benefits—up 7 slots
• Employee efficiency—moved up 3 slots
– In contrast, these items dropped:
• Being an employer of choice—down 10
• Cost of employee salaries/wages—down 4
• Diversity/cross-cultural/multi-generational—down 4
Which is Causing a Shift in Focus
Which of the following statements most accurately describes your organization’s
approach to health care benefit strategy today (for your active employee population)?
65%
Aggressively Manage
Health/Wellness/Productivity
82%
Manage Purchasing Efficiency and
Vendor Performance
31%
15%
2009
Exit Health Care, Invest in Health
Exit Health and Health Care*
*New data point 2008
2%
3%
2%
0%
2008
Which is Causing a Shift in Focus
Which of the following statements most accurately describes your organization’s approach to
health care benefit strategy in the next 3–5 years (for your active employee population)?
75%
Aggressively Manage
Health/Wellness/Productivity
Manage Purchasing Efficiency and
Vendor Performance
87%
6%
9%
2009
2008
14%
Exit Health Care, Invest in Health
4%
Exit Health and Health Care*
*New data point 2008
5%
0%
Unfortunately, This Conflicts with What We Know
10 = 70%
66%
20 years
2,400
33% = 130+
10-20 years
50%
40%
25%
39M
5X
1 in 10
71%
437,000
$1.1 Trillion
We Also Know That...
Cost reduced Cost increased
Change in Cost Follows Change in Risk
$600
$400
$200
$0
-$200
-$400
-$600
3
2
1
Risks Reduced
0
1
2
3
Risks Increased
– Actives: Savings per risk reduced: $231; Savings per risk avoided: $320
– Retirees<65: Savings per risk reduced: $192; Savings per risk avoided: $621
– Retirees>65: Savings per risk reduced: $214; Savings per risk avoided: $264
Source: AJHP. 15(5):341-349, 2001
The Key Is Measurement
Employers are looking for useful information to determine
– Which programs are effective
– How vendors are performing
– Whether to eliminate programs
– How to refocus current programs
– Which new programs should be considered and implemented
– What groups to target
The Key Is Measurement
Yet, employer experience suggests that:
– They receive a deluge of reports from different vendors
• Hard to interpret into a coherent understanding of performance
• Difficult to combine
• Insufficient standardization and interpretation
– There is a lack of information on behavior-linked elements and health
status
– They are challenged to connect to broader health costs (like disability
and productivity)
– That more data is not always better—the key is having the right data
The Key Is Measurement
Inputs
Census and
demographic
data
Medical and
prescription
drug claims
data
Health Risk
Questionnaire (HRQ)
and biometric testing
results
Disease
management,
wellness,
coaching use
Health Risk Analysis Tool
Outputs
Baseline measures
- Employer-specific groups
- Health status
- Current behaviors
Stratify results reflecting
health status and
behavioral risk
Target specific groups,
conditions, and behaviors
based upon actual employer
results
Compliance with Prescription Medications & Paid
Claims PMPY—Stratified by Level of Deductible
Examine how Rx compliance and total claims vary by medical deductible. Bubble size is proportional to number of members.
$6,000
$5,000
65.2%;
$3,427
$4,000
$3,000
69.2%;
$3,692
$2,000
71.2%;
$3,485
65.2%;
$2,417
$1,000
$0
60.0%
63.0%
1. $0 / $0
66.0%
2. $250 / $500
69.0%
3. $500 / $1,000
72.0%
4. $1,000 / $2,000
75.0%
Compliance with Cardiovascular Medications & Paid
Claims PMPY—Stratified by Participation in CAD DM
Examine how compliance and claims vary for those participating in DM. Bubble size is proportional to number of members.
Translucent (lighter) bubbles represent Year 1 data, and solid (darker) bubbles represent Year 2 data.
$18,000
$16,000
86.1%;
$14,237
$14,000
89.2%;
$13,585
$12,000
$10,000
$8,000
71.8%;
$8,807
73.0%;
$7,123
$6,000
$4,000
$2,000
$0
60.0%
65.0%
70.0%
75.0%
80.0%
N
Y
85.0%
90.0%
95.0%
100.0%
Health Risk—Cohort Analysis
Cohort Analysis—Baseline
Did employee
behaviors
improve?
Cohort Analysis—Subsequent Years
Were chronic
conditions managed
successfully?
Cohort analysis is used to test
program performance. Full
population analysis can reveal the
groups that contribute most to
health care cost increases.
The Key Is Measurement
Goal is to be able to answer questions critical to health strategy
– What are the top drivers of cost and excess risk?
– Where are the highest segments of cost, and which have
the greatest potential from intervention (conditions or
groups)?
– Are my programs working and working together?
– Which plans, carriers, or programs are most effective?
– How can limited resources best be directed to improve
health risk (and costs)?
Human Capital Metrics of Success:
Case Studies of ROI Models
across Industry Type and Size
Paul Hodgins MD
Medical Director
GE Energy
Company Profile
• GE Energy Infrastructure provides solutions that powers
worldwide industry. From gas and steam turbines to drilling
equipment and water- processing systems
• Energy has over 500 worksites in over 100 countries. Some of the larger
locations are in NY, NC, SC,TX, France, Hungary, India
• We have about 60,000 employees. Approximately half in the US and half
outside the US
• Workforce demographics – average age 44, and 87% male
Health Risks at GE Energy:
Employee Health
Profile
Overall
Number of Health Behavior Risks
• Energy has fewer high risk participants than the StayWell norm
• Energy has more low risk participants than the norm
• Overall, energy participants have fewer risks than the norm
Percent at Risk
100%
25%
34%
Ge Energ y
N o rm Gro up
B
6+ Risks
s
3-5 Risks
re
Ca
0-2 Risks
k
ac
0%
High Risk
ol
er
st
le
ho
37%
50%
25
20
15
10
5
0
C
53%
s
re
St
54%
75%
t
gh
ei
W
13%
se
ci
er
Ex
9%
Number of Health Behavior Risks
The specific risks of the high risk group:
•Data from self reported Health Assessment
•Back Care (25%)
•Energy participants have more low risk participants than the
norm and fewer high and moderate risk participants
•Exercise (22%)
•Goal is to reduce high and moderate risk groups
•Weight (22%)
•Stress (20%)
•Cholesterol (19%)
Health Promotion Efforts
•
Cancer Screening
• Focus on breast and colorectal cancers
• Communications campaigns
• FOBT pilot
•
Weight Watchers reimbursements
• 100% for program completion
•
Tobacco Cessation
– Quitline with free NRT
– US, Canada, India
– Freshstart
– Quitnet (outside US)
Health Promotion Efforts
•
Cardiovascular screening developed by GE Energy
Health Services to:
–
–
•
Lifestyle coaching
–
–
•
Raise awareness of risks for heart disease
Promote healthy lifestyle changes to help prevent
Cardiovascular Disease.
Triggered by Health Assessment
Target risks include weight, fitness, nutrition, stress,
back care, cholesterol mgt etc.
Quarterly Health Themes
•
–
–
46 sites, 6000 participants
Heart Health, Focus on Fitness, Cancer Prevention,
Safety at Home
Energy designed-action oriented
CARDIOVASCULAR
RISK ASSESSMENTS
Metrics: Planning first
• Establish program evaluation model from the start
– Cost effectiveness, behavior change, employee
satisfaction, productivity
– Comparative groups (pre/post, participant/non-participant
– Measure what matters
• Determine data that will be needed
• Determine methods to measure
Metrics: Employee Utilization
• Program participation is the first step in program
evaluation
• Assess participation from various angles
• Be consistent, track over time
Tobacco Cessation
Cost of tobacco/employee = $3,783
($2,583 for health care and $1200 for productivity)
American Cancer Society Quitline®
– Official launch June 2008
– 36,000 covered lives
• 18.4% tobacco prevalence rate based on gender, age range and education = 6624 tobacco users
• Potential cost savings: $25,058,592.00
– Projected utilization goals
• 10% = 662 participants/yr
• 5% = 331 participants/yr
– Current Utilization (through 5/09) = 127 callers; 103 enrolled in counseling
Cost savings if 103 enrollees quit for good: $389,649.00
Metrics: Program Effectiveness
Behavior change
– Individual behaviors
• Quit smoking, increased exercise, decreased weight
– Risk reduction
• Moving population from high and moderate risk to low risk
Clinical Outcomes
– Reduction in Blood pressure, cholesterol, blood sugar
– Decrease prevalence of chronic conditions
– Decrease incidence/prevalence of cancer
FOBT InSure FIT Program
7,900 Energy employees 50 and older eligible for test
Piloted program for 2,900 employees
– 336 tested; 14 detected
Rolling out to all non pilot sites
– 5,000 employees and interested spouses (50 yr+)
– More aggressive communications to increase participation
– Using same participation rates would find 30 people with possible
colorectal cancer that treated
The opportunity is to save lives and the $X
annual spend on colorectal cancer
Metrics: Program Effectiveness
Cost
– Direct and indirect costs
– Medical and productivity
– Absolute Cost and/or trend reduction
Satisfaction & quality of life
–
–
–
–
Vendor and program satisfaction survey
Company employee satisfaction surveys
Use quality of life (SF36) pre and post program
Anecdotal-real life stories
Metrics: Program Effectiveness
Additional considerations
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–
–
–
–
–
Data quality
Factoring all variables such as plan design changes
Risk adjust groups
Privacy
Benchmarks
Audience
Communicating Outcomes
Each stakeholder needs different data views
Tailor message for specific audience:
participation, behavior change, clinical outcomes or cost.
Sr. Management
Sites
–
–
–
–
– Detailed
– Participation
• Show all sites to encourage
competition
– Behavior change
High level
Participation
Cost
Anecdotes
Human Capital Metrics of Success:
Case Studies of ROI Models
across Industry Type and Size
Dr. Jon Cohen
Sr. Vice President & Chief Medical Officer
Quest Diagnostics Incorporated
Company Profile
Leading provider of diagnostic testing, information and services
–
–
–
–
Comprehensive Diagnostic Testing
Advanced Information Technology Solutions
Clinical Trials Testing
Innovative Diagnostic Products
– Risk Assessment Solutions to Life Insurance Industry
Serving 50% of US physicians and hospitals
Pioneer in bringing new tests & technology to market
World leader in cancer diagnostics
Touching the lives of patients 150 million times each year
“Health” Profile of Quest Diagnostics Employees
•
•
•
•
Piloted – 2004; Introduced – May 2005
Transition from sick care to health care
Emphasizes health literacy, education and metrics
Volunteer health promotion champions at major
worksites
Driving Lifestyle Changes
Identify Health Risks
– Blueprint for Wellness
• Health risk assessment which includes labs & biometric
screening
• Financial incentives doubled participation to 61%
– Colorectal Cancer Screening
Promote Healthy Changes
– Tobacco cessation
• Reported quit rate of 38%
– Physical fitness, weight, and stress management
programs
– Audit onsite food offerings
• BU’s meeting vending machine goals increased 6% to 16%
• BU’s meeting cafeteria goals increased 29% to 43%
Tobacco Use
Outcome – Significant Reduction in Tobacco Utilization
Obesity – Is it Time to Demand More From Our Employees?
Colorectal Cancer
Focus on Wellness is Good for Business
• Estimated ROI - $4.80 for every $1 invested
• Positive driver of employee satisfaction
• Public Recognition:
– “Best Places to Work”
– National Business Group on Health’s “Best Employers for Healthy
Lifestyles” award (2005 – 2008)
• Included in company balanced scorecard
• Sell corporate wellness product, Blueprint for Wellness™
– 3M, Jeld-Wen, Domino’s, General Electric
ROI Source: Thomson-Reuter, 2005-2008 Analysis
Continuing Journey
• Integrate Data
– With health and disability plans
• HealthyQuest 2.0
– Leverage social networks
– Expanding use of PHR’s
• Targeted Programs
– Identify gender and ethic
health disparities
– Introduce programs to
close the gap in care
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