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SHRM Memphis August 2009 Frank Hone Presentation
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SHRM Memphis August 2009 Frank Hone Presentation

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Frank Hone; noted Author of "Why Healthcare Matters," delivered a very informative and fact packed presentation that described how employers can effect their bottom line in Health Care costs within …

Frank Hone; noted Author of "Why Healthcare Matters," delivered a very informative and fact packed presentation that described how employers can effect their bottom line in Health Care costs within their own organizations. They key to success is to take the lessons learned by pharmaceutical companies in their marketing and apply it to health care consumerism programs to engage employees to make lifestyle changes.

Published in: Business, Economy & Finance

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  • 1. Employee Health Benefit Trends: How Healthcare Consumerism Can Help Change the Game Frank Hone Sustainable Engagement Leader Healthways August 18, 2009 1
  • 2. 2
  • 3. Presentation Overview 1. Key Issues and Challenges 2. The Employer Role in Healthcare 3. Why Healthcare Matters 4. How Healthcare Consumerism Fits 5. Driving Health Behavior Change 3
  • 4. Introduction and Background Recently joined Healthways as Sustainable Engagement Leader 28 year career in consumer advertising and marketing with NY advertising agencies and consultancies 16 years focused on healthcare communications, particularly DTC 4
  • 5. Why Healthcare Matters • Encourages business leaders to proactively address employee health issues and strategies • Focus is on free-market solutions and demand-driven strategies: • Healthcare Consumerism • Personal Responsibility 5
  • 6. 1. Key Issues and Challenges Quality, Access, Cost – The “Holy Grail” Complex provider networks and insurance schemes – Outgrowth of “managed care” era Third-party Payments – Limits consumer knowledge of price/value Rising Chronic Disease Incidence – Cardiac, Metabolic, Respiratory, Cancer, etc. Lifestyle/Behavioral Issues – Sedentary ways, excess, limits on personal responsibility Employer role – Hands-off or Hands-on? 6
  • 7. 2. The Employer Role in Healthcare Hands-off or Hands-on? 7
  • 8. Two-thirds of insured Americans have employer- provided health insurance 100% 90% 99% 99% 99% 98% 98% 99% 98% 98% 99% 99% 80% 68% 68% 66% 70% 65% 65% 63% 60% 62% 59% 59% 60% 50% 56% 57% 58% 58% 55% 52% 47% 48% 49% 40% 45% 30% 20% 10% 0% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 All Small Firms (3-199 Workers) All Large Firms (200 or More Workers) 3-9 Workers 8 Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2008.
  • 9. Higher health premiums cut into corporate profits 9
  • 10. Healthcare is the #1 CEO issue Source: Mercer 10
  • 11. Employee Benefits: Top Challenges Five leading factors representing the top challenges in maintaining affordable employee health benefit coverage: – Employee’s poor health habits 67% – Underuse of preventative services 42 – Catastrophic/end-of-life care 36 – Poor information on provider costs 24 – Overuse through inappropriate care 21 – Source: Watson Wyatt, January 2009 survey of 489 employers 11
  • 12. Big Companies Are Investing In Employee Health Onsite flu shots 97% Weight loss programs 85% Health Risk Appraisals 80% Tobacco cessation programs 74% On-site workout facilities 73% Online wellness programs 72% Organized walking/exercise programs 66% – 2007 Business Roundtable Survey 12
  • 13. 3. Why Healthcare Matters 13
  • 14. Overweight = Unhealthy 14
  • 15. Lifestyle-related chronic disease on the rise 15
  • 16. Individual health behaviors are lacking What percentage of Americans can agree to all five of these statements? I exercise 30 minutes or more on most days of the week I eat a healthy diet with 5 fruits/vegetables on most days I am within 5 pounds of my ideal body weight I don’t use tobacco products I have 2 or fewer alcoholic drinks per day 16
  • 17. Behavior is #1 Driver of Health Status 60 50% 50 40 30 20% 20% 20 10% 10 0 Care Access Genetics Environment Behavior Source: Inst for the Future, CDC 17
  • 18. 4. How Healthcare Consumerism Fits Concepts and Best Practice 18
  • 19. Healthcare Consumerism Can Help – “Healthcare Consumerism is about transforming an employer’s health benefit plan into one that puts economic purchasing power — and decision-making — in the hands of participants. – “It must focus on health behavior change. Employers can supply information and decision support tools, along with financial incentives, rewards, and other benefits that encourage greater personal responsibility for their health.” Ron Bachman Senior Fellow Center for Health Transformation 19
  • 20. Healthcare Building Blocks…. + + Financing Medical Behavior 20
  • 21. Healthcare Building Blocks…. + + Financing Medical Behavior Health Insurance Medical Marketing Model Consumer Co-Pays Doctor Stay healthy Out of Pocket Hospital Prevention Government Funding Pharmacy Engagement Drugs and Procedures Adherence 21
  • 22. Employers can’t really change the healthcare system, but they can influence positive outcomes through financing and behavior change 22
  • 23. Financing and Behavior Change: A few examples 1. CDHPs 2. Obesity 3. Smoking Cessation 4. Health Risk Assessments 5. Incentives 23
  • 24. 1. CDHP growth continues…a way to encourage personal responsibility Source: Mercer 24
  • 25. CDHP Example: Blue Ridge Paper Problem – Blue collar mill - with 2,100 primarily male, older union employees, with “entitlement” mindset and little health benefit knowledge or investment - couldn’t afford premium increase projections Solution – Focus on creating “culture of health”; engage employee reps in decision-making; educate workforce and family – shift to CDHP + 17 specific population health management programs + coaching + fitness program + onsite clinic Results – Absenteeism dropped by 50%, Disability claims dropped by 20%, chronic claims dropped by 16%. – Five year cost savings = more than $17 million 25
  • 26. 2. Obesity… a major health challenge Obesity accounted for 27% of the rise in medical costs from 1987 to 2001 Ken Thorpe - Emory University Obesity costs Companies $45 billion annually Conference Board Obesity is a more powerful trigger for chronic health problems than either smoking or heavy drinking RAND But many employers see it as sensitive issue to address head on… 26
  • 27. Weight Loss Example: Quest Diagnostics • Problem Workforce obesity was on the rise, increasing each year from 2005-2008 • Solution Management initiates company-wide weight loss challenge • Results Broad Participation – spurred Bill Germanakos to drop 164 pounds on “The Biggest Loser” TV program. He’s now “Wellness Ambassador” Positive ROI - Winner of the Healthy Lifestyles Gold Award for its Healthy Quest employee wellness program 27
  • 28. 3. Tobacco Use.. leading cause of death in the US 28
  • 29. Smoking Cessation Example: Weyco Problem: Lifestyles risk drive costs – Illegal drugs and tobacco – Excess use of alcohol – Unhealthy eating – Physical inactivity Strategy – Stop hiring or retaining tobacco users - adopt a no- smoking policy that required employees to quit smoking during their private time and/or submit to a smoking test. Smoking cessation program options were offered. Results – Policy took effect in January 2005, a year after announcement – Four employees refused to take smoking test – Smoking was effectively eradicated at Weyco 29
  • 30. 4. Health Data…a way to manage risk Claims data Health Risk Appraisal Biometrics Past behavior Current status Future Risk Then, the data can help drive the design… 30
  • 31. HRA Example: Johns Hopkins Problem – Workforce was becoming older, sicker and more costly due to asthma, hypertension, diabetes, depression, anxiety, COPD, cancer, back pain Solution – Redesign health benefits and health initiatives, tied to Health Risk Assessment (HRA) – Add health coaching, education, incentives Results – HRAs provided more data on employee health than claims – Identified areas where interventions would help – Chronic care management has led to savings of $300 PMPM 31
  • 32. 5. Incentives…a path to motivation More companies are offering a financial incentive to participate in health initiatives: 32
  • 33. Incentives Example: Pitney Bowes Problem – As medication co-pays increased with newer health plans, many employees cut or eliminated drug usage. Complications caused increased medical bills Solution – Provide lower cost or free drugs for certain chronic conditions: asthma, diabetes, hypertension Results 90 81 82 80 75 76 – Adherence on drug increased 70 62 substantially and medical 60 50 costs declined for three areas 40 33 30 20 10 0 Asthma Diabetes Hypertension 2001 2006 33
  • 34. Incentives: Penalties would increase adherence to chronic treatment regimens How Likely Would You Be To Comply With the Treatment Regimen Recommended by Your Doctor If You Would Be Required to Pay Higher Insurance Costs Otherwise? 63% 31% 18% 14% 9% 6% 8% 3% 3% 4% 5% 1 2 3 4 5 6 7 8 9 10 Not at all likely Extremely likely Deloitte's 2009 Survey of Health Care Consumers n = 2,192 respondents with one or more chronic conditions 34
  • 35. What does all this mean for employers? Behavior change comes from encouraging personal responsibility about health, lifestyle and treatments – Engage employees as partners in managing healthcare costs and quality Corporations can adapt by treating employees as if they were customers of the company – Motivate them to accept their role and understand your support and financial commitment 35
  • 36. Does having health and wellness programs equate to better outcomes? Between… Wellness, Care Management, Health Interventions, Fitness Programs Consumer Engagement Enrollment and Interventions Influence + Incentives + Motivation ..and Actual Employee Health Behavior Change 36
  • 37. 5. Driving Health Behavior Change Using Communications Effectively Needs to be multi-stage Accommodates consumer decision pathway 37
  • 38. Employee health engagement is a lot like consumer advertising… 38
  • 39. “AIDA” Awareness Interest Desire Action Of a In Wanting it Buying it brand, knowing category, more service, etc. 39
  • 40. Comparing the two… Consumer advertising: Employee health engagement: Focuses on getting Focuses on getting consumers to buy your employees to change brand behavior Effective use of media, Effective use of media, messages, and metrics messages, and metrics Follows “AIDA” Addresses the decision pathway 40
  • 41. Consumers have a decision pathway to follow with healthcare… Compliant patient BARRIERS Rx written/filled Physician appointment Desire to treat Information gathering Relevance to disease Recognition of symptoms Undiagnosed sufferer 41
  • 42. …that also has many emotional barriers…. Fear Confusion Cost Denial Trust Solutions Support 42
  • 43. …that need to be addressed in different ways Emotional vs. rational messages Storytelling vs. facts Consider timing and sequencing – Media consumption and penetration – Different motivation and incentives – Recognize varying behavior change dynamics Communicate two-way with reinforcement 43
  • 44. Some DTC TV ads as examples… 44
  • 45. Synvisc Advertising and Fulfillment Advertising shows target adults in situations that OA knee sufferers cannot do or enjoy Fulfillment materials provide deeper education/ information and a list of providers 45
  • 46. Print Print w/BRC Documercial Branded and unbranded TV Branded and unbranded web sites OA educational events Synvisc Consumer-friendly call scripts Fulfillment materials Reminder mailings Tell-A-Friend Program 6,000 Physician Provider Network Follow-up surveys Physician and rep letters/e-mails Community-based outreach materials Specialist Specialist Specialist Ad easel Patient brochures Exercise flyer Doctor mention statistics Specialist Specialist PPN reprint carrier Doctor mention flash card 46
  • 47. Lessons Learned from DTC 1. Relevant segmentation leads to Identify key segments of your smarter strategies employer population 2. The decision pathway begins Consider the challenges and with a health issue and involves barriers that your employees are psychological and attitudinal facing in dealing with an array of barriers conditions 3. Information overload is Deliver messages in a format and counterproductive. Bite-sized form that will best lead to pieces of information work behavior change in measurable better ways 4. Most healthcare products and Find ways to stress the services are purchased because importance of dealing effectively of need, not desire with health issues 5. Interactive communication Supplement your health portals opportunities can be more with ways to interact directly with productive than “push” employees marketing 47
  • 48. Strategic Development Framework for Employee Communications communication objectives target audiences communication strategy and tactical approach media choices key messages, and creative work Measure results, encourage and share feedback Revisit everything with an eye to continual improvement 48
  • 49. Health Behavior Change Requires: Customized solutions, tailored to their: – Readiness to change – Lifestyle preferences and capabilities – Media consumption, message responsiveness Convenience elements that reduce as many barriers as possible Incentives that help make the abstract benefits of good health more near-term and concrete 49
  • 50. Thank You! 50
  • 51. Questions and Discussion… frank.hone@healthways.com 51
  • 52. Why Healthcare Matters – on sale now! • Encourages business leaders to proactively address employee health issues and strategies • Focus is on free-market solutions and demand-driven strategies: • Healthcare Consumerism • Personal Responsibility $20 check or cash 52