Scott MacStravic, PhD
It is common practice for hospitals that are increasingly investing in employee health management (EHM) for their own workforces to operate their own programs. On the other hand, it is often the case that it is both less expensive and more effective for them to outsource one or more elements of the EHM strategy, which include:
If they outsource any or all of these elements, however, hospitals and other healthcare organizations (HCOs) that invest in EHM must still be active and enthusiastic partners in the effort, rather than passive customers waiting for the results and economic gains to emerge. Moreover, for hospitals that have taken EHM one step further, by offering their own programs as a revenue-generating service line, will want their employer clients to be enthusiastic partners as well, since only enthusiastic partnerships will achieve and learn about the full economic benefits and ROI from EHM investments.
For example, unless the hospital (or the employer client in that application) cooperates fully in the assessment process, chances are that a far less complete and accurate analysis of the workforce health status, risk behaviors and conditions, chronic diseases, and impairment in productivity/performance related to these as well as other impairment factors will result. Usually an incentive, of at least $50 to $100 must be offered to all employees and paid to all participants in the assessment process in order to achieve even majority participation. And any employee who does not participate will be an “undiscovered land” when it comes to planning and targeting employees for participation in specific EHM interventions.
Moreover, any employees not included in the baseline assessment cannot be included meaningfully in the EHM evaluation, since there will be no baseline data available as the basis for determining results. And any who participate in the baseline assessment but not repetitions used for evaluation, will be absent from the results analysis. While “non-repeaters” may be assumed to achieve anywhere from no improvement to the same degree of improvement as those who take both baseline and repeat surveys, there is no way to validate either assumption, unless there are no or minimal non-repeaters.
Enrolling and retaining employees in EHM initiatives based on their assessments is an equally important partnership challenge. Employers normally invest in both promotional efforts and incentives for participation in order to achieve high levels thereof. Full and enthusiastic participation by employees may require significantly greater incentives than are adequate to get high participation in assessments, since the assessments take only minutes of employees’ time, while participation in initiatives can take many hours and even days of time for best results. Supporting EHM initiatives by offering healthy food in cafeteria and vending machines, or discounted/free gym memberships, classes and activities onsite is another way hospitals and other employers can be effective partners.
Many employers conduct “team contests” to stimulate peer support as well as competitive motivation among EHM participants, with rewards for best teams to add to incentives or even substitute for individual ones. Creating websites that team members can use, or web pages for individual participants, can help maintain motivation and participation, while “group support” websites or other “healthy community” support can also help. Contests for individuals are also effective, though may disappoint the “losers” and fail to have the best total economic impact, which includes employee retention effects.
Partnering in the measurement process is one of the most essential, yet least common practices among employers. For example, a recent report indicated that only 38% of employers surveyed even measured the ROI they achieved for their EHM investments, though this was up from only 23% in 2006. [“Wellness: Saving Lives and Money” 2007 Willis Survey (Willis Americas Employee Benefits – North America) (request: willisebsurvey@willis.com)] Only 55% even compared costs after vs. before their EHM strategy was implemented.
Measurement can be an expensive and risky business investment. It may require repeated contacts with employees that risks angering them, for example. Unless assessment surveys are used to estimate productivity/performance impairment, the costs of measuring these sources of the majority of EHM economic impact may threaten ROI therefrom. Moreover, basing “discriminatory” incentives on some elements evaluated may risk federal government or union displeasure and negative responses thereby.
For example, federal regulations effective in 2008 appear to prohibit paying smokers for quitting, unless employees who already do not smoke get similar incentives for their abstinence. Paying employees for weight loss may be deemed discriminating against employees who are “disabled” by their “eating disorder”. Even collecting and analyzing information about employee health may be deemed a violation of HIPAA rules. Hospitals will have to be extremely careful what they pay employees for, in addition to incurring the financial costs of paying incentives in the first place.
There is a way around both problems, of course. Since it has long been perfectly legal and an accepted business practice to pay employees more if they produce more and perform better, using an internal “pay-for-performance” (P4P) program can minimize both risks and costs. There should be no risk in paying more to employees whose improvement in their own health risks or impairment factors has yielded measured improvements in their output or other performance dimensions. Moreover, this could mean that no incentives need be paid for participation in EHM initiatives, since P4P bonuses or awards would only be paid to employees who succeed.
In addition, the amount paid can be made to precisely match the degree of improvement achieved by each individual EHM participant, rather than the same large amount for all participants, or all who “succeed” in enrolling, actively participating, or completing the EHM initiative. It would substitute for incentives that pay for changes in behavior, or even for improvements in health status, since both are problematic. Moreover, P4P systems in general have been shown to stimulate increases in productivity and other performance measures, by themselves.
Hospitals have the added interests in devising and adopting P4P systems because of the various systems that are being used to determine their revenue. Once such systems are in place, they will enjoy far greater potential for accurately and reliably measuring the improvements achieved through EHM investments. This will also tend to prevent employee “enthusiasm” or “over-optimism” in reporting their upfront impairment or degree of improvement when incentives are offered for such improvement.
In any case, the more hospitals behave as enthusiastic and effective partners in EHM efforts, as clients of EHM suppliers – or get their employer clients to do so when the hospital is the supplier – the greater is the likelihood for achieving and accurately/reliably measuring the total economic impact of EHM investments. And the more accurately and reliably such impact is measured, the more likely it is that hospitals and their clients will continue to invest in EHM, and enjoy continuing and usually increasing benefit therefrom over time.
Remember Me
