Human Resources: Healthy Staff, Healthy Bottom Line
Qualify for a free subscription to HealthLeaders magazine.
Even healthcare professionals need a financial incentive to change behaviors, but executives are finding the efforts can be worthwhile financially.
The U.S. Senate Finance Committee recently said it would consider imposing a "lifestyle tax" on sugary, obesity-inducing soft drinks as a way to pay for healthcare reforms. Whether that tax is imposed, the very idea that it's being considered marks the latest shot in the war against obesity—a campaign that is fueled as much by skyrocketing healthcare costs as by a concern for public health.
The Centers for Disease Control and Prevention reports that 64% of all adults over 20 years old—about 72 million Americans—are overweight, and 31% of them are obese, at a cost of about $75 billion annually for treating obesity-related diseases.
After years of lagging behind most every other industry, hospitals are finally embracing wellness programs. San Diego-based Scripps Health reported this year that 83% of the health system's 12,700 employees are enrolled in a wellness program that has saved it $2.6 million annually in medical and pharmacy costs. The health system, in turn, will pay $1.3 million toward employees' healthcare premiums, about $428 to each of the 3,187 employees who are highly engaged in the wellness program.
On average, Scripps found that wellness plan participants have 30% lower medical and pharmacy costs, a 25% reduction in hospital visits, 17% fewer emergency room visits, and 11% fewer prescriptions.
Hamilton Mears, manager of corporate wellness and health promotion at Scripps Health, says that a return-on-investment analysis of the health system's wellness program in 2007 determined that Scripps saved $1.31 for every dollar spent.
"That is just medical and pharmacy expense savings," Mears says. "There is a great deal of evidence strongly supported by research that says the medical and pharmacy savings represents between 25% and 30% of total savings. The rest will be the productivity impact with reduced absenteeism and increased productivity."
Mears says there are three key components to a successful wellness program. "You need to have staff dedicated to wellness, specifically. Secondly, you need to have good measurement systems for risk. The third thing is you have to have senior leaders who are committed to seeing the program work, and incentives," he says. "Without those elements it's very unlikely that any wellness program would be helpful."
The November/December 2006 American Journal of Health Information describes the acronym AMSO—awareness, motivation, skills, and opportunities—to explain principles that must be in place to ensure an effective wellness program. Employees have to be made aware of the health issue, usually through a health risk assessment. They have to be motivated to take part in the program, and a common method is reduced health insurance premiums. They have to be taught a skill set that helps them learn to eat or cook healthy foods, quit smoking, or deal with stress. And they have to be given the opportunity and the environment in which to practice those new skills.
- MU Compliance Announcement Sparks Concern, Confusion
- New G-Codes to Pay Doctors for Broad Array of Non-Face-to-Face Care
- Telehealth Improves Patient Care in ICUs
- CMS Sets 2014 Pay Rates for Hospital Outpatient and Physician Services
- States Rejecting Medicaid Expansion Forgo Billions in Federal Funds
- Douglas Hawthorne—A Chance to Do Something Big
- Hospital M&A Volume Up, Value Down in 3Q
- Scary Financial Challenges for 2014
- LifePoint Bolsters Presence in Michigan's Upper Peninsula
- Small Doesn't Mean Doomed