Colonial Medical Insurance outlines how the health and wellbeing of corporate employees can help to increase a firm’s return on investment, and how firms can monitor the benefits.
In the struggle to contain rising healthcare costs, more and more top employers are taking bold actions and offering wellness programmes to empower employees to take control of their health and hold them accountable for costs. Such programmes have interchangeably been entitled population health management, health promotion or corporate wellness. These programmes may include education sessions on healthrelated topics, changes to physical environments including on-site gyms and ergonomic assessments, and individualised lifestyle coaching. Some companies implement more systemic changes such as offering on-site medical clinics where the doctor comes to you, as seen at the New York Stock Exchange, or policies against hiring smokers, as seen at the Cleveland Clinic and several hospitals in the US.
The shift toward corporate wellness is being driven by both cost challenges and the proven return on investment (ROI) demonstrated by leading companies. Bermuda, along with most OECD countries, has experienced dramatic inflation in healthcare costs over the past two decades. Employers that continue to subsidise the majority of health plans see costs cutting into their profi tability; while employees who co-share have seen premium increases outpace wage increases, sometimes placing signifi cant fi nancial pressure on them and their families.
The good news is that some expenses may be prevented by focusing on reducing the risk factors associated with chronic diseases such as cardiovascular disease and diabetes, which are now the major cause of death and disability in Bermuda and account for a growing percentage of healthcare costs each year. The rate of obesity, a primary contributor to these diseases, has been increasing in Bermuda every year, with Bermuda becoming one of the fattest nations in the world.
Workplaces, where most adults typically spend half or more of their waking hours, can have a powerful impact on individuals’ health by increasing their health knowledge, creating supportive environments for lifestyle change, and integrating healthy lifestyles into the fabric of the organisation’s culture. Several major companies in the US, Canada and the UK have conducted studies that show positive trends in ROI from corporate wellness programmes. Peer-reviewed studies have indicated that economic gains and ROI may be accomplished through an improvement in employees’ health by way of reduced medical claims and increased worker productivity.
"These programs are designed with the overall goal of... ultimately yielding reduced group healtcare costs. In the future, this cost reduction demonstration may prove to be a powerful negotiation tool for lower health insurance premiums."
Studies have shown that ROI has ranged anywhere from $2 per $1 invested to $6 per $1 invested. A study by L.S. Chapman entitled Expert opinions on best practices in worksite health promotion, which entailed a meta-evaluation of 42 studies, reported cost-benefi t ratios from $2.05 to $4.64. Similarly, a 38-month study by R.J. Ozminkowski of 23,000 participants in Citibank’s wellness programme found that within a two-year period, Citibank realised a ROI of between $4.56 and $4.73. In terms of reduction in medical care expenditures per employee, Johnson & Johnson reported decreases in healthcare utilisation and associated expenditures of $224.66 per employee, per year.
The chart below shows top corporations' ROI for each dollar spent on wellness program:
While the research touts the benefi ts of encouraging healthy lifestyles in the workplace, it is important to note that not all workplace wellness programmes are created equal. Many companies have started with activity-based programmes that dwindled due to lack of employee interest and engagement. However, several employers have managed to create widespread cultural changes that support their employees in their long-term efforts to adopt healthier lifestyles. More than ever, many corporations are recognising potential in ROI and are going above and beyond in taking their programmes to the next level with innovative programming that includes measurable success and documented outcomes.
Results-oriented programmes must be carefully designed to drive adoption and demonstrate ROI. Several key components are a must in programme design, including executive level buy-in, dedicated wellness teams, data collection, appropriately targeted health intervention that combines both health promotion and disease management initiatives, and continuous monitoring of health outcomes. Without the careful measurement of outcomes, programme enhancement and tailoring are impossible and uptake is poor.
The most comprehensive programmes will often tie incentives to benefi ts design and reward and/or penalise employees for choices they make with regards to their health. These programmes are designed with the overall goal of improving the medical profi le of the client and reducing the employees’ need for, and utilisation of, healthcare services, ultimately yielding reduced group healthcare costs. In the future, this cost reduction demonstration may prove to be a powerful negotiation tool for lower health insurance premiums.
Medical insurance companies, in collaboration with employers and their employees, are well positioned to offer results-oriented wellness programmes as part of their medical benefi ts schedule that will empower employees to take control of their health and motivate them to make the right healthcare decisions based on quality and effectiveness, and that will subsequently drive down medical claims cost. Employees may be informed and appropriately availed of the correct benefit.
Over the last few years, Colonial Medical Insurance (CMI) has developed a healthcare plan that includes specifi c benefi ts and services that are targeted towards one goal: improving the overall health status of the insured population, i.e. annual physicals, disease management programmes, a maternity programme, case management, online health tools, and services such as ‘Nurse on Call’ and ‘Consult a Doctor’. CMI, in its commitment to provide comprehensive health cover at competitive premiums, has developed a newly designed Corporate Wellness Programme that encompass all of the above services, in addition to new features, to ensure a standardised, effi cient, costeffective delivery approach.
Over the next year, CMI will roll out its revamped Corporate Wellness Programme to a select group of clients in four jurisdictions— Bermuda, the Bahamas, Cayman and the British Virgin Islands— beginning with the groups that have the most modifi able risk factors and largest medical claims as well as the commitment and desire to lower costs through preventive programming. There are elements that will be core to CMI’s Corporate Wellness Programme, while appropriate health interventions will be tailored to each client’s needs and interests. This programme will then be expanded to the wider insured population in the next few years.
Highlights from the Corporate Wellness Programme include:
• Seven core results-oriented programme elements with a strong focus on outcomes, targeted health interventions and employer/ employee engagement
• tailored to each client’s employee population experience
• Use of strategic partners and an expert network of trusted health providers, and government and community groups for cost-effective programme delivery
• Client-centred approach to drive accountability and adoption
• Community-minded for total population wellness—with a focus not only on the insured client but on spouses and dependants
• Use of social media and dedicated website to ensure engagement with employers and employees is fresh, modern and relevant.
The CMI approach to wellness is to collect all relevant data upfront. Data will be instrumental to selecting targeted health interventions and monitoring programme outcomes. More importantly, it will be used to communicate each client’s ROI. Although ROI may take upwards of fi ve years to measure, it will demonstrate the economic viability of the programme in the long term. In the interim, savings to companies will be realised through control of claims costs.
After data is collected, CMI will work with each client to design a roadmap of programme services and a delivery timeline. Appropriate health interventions are chosen for each company based upon the data that has been collected. This ensures that the programme’s offerings are consistent with the organisation’s needs and employees’ interests. Each individualised programme is therefore realistic, rational, relevant and cost-effective. Reporting and continuous monitoring of outcomes ensures programme effectiveness and accountability.
By focusing on targeted interventions for chronic disease (with an initial emphasis on diabetes and cardiovascular) and related risk factors, combined with provision of incentives to corporations that make a conscious effort to improve the health of their employee population, CMI, in collaboration with its policyholders, may succeed in driving down the cost of healthcare expenditure in Bermuda and creating an altogether more healthy community.
Jacqueline Teunissen is the corporate wellness director at Colonial Medical Insurance Ltd. She can be contacted at: jacquelineP@colonial.bm
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