- Health Insurers Filing for Participation in Kansas and Missouri ExchangesPosted 6 days ago
- The Tomato Paradox of Health Care ReformPosted 17 days ago
- 6 key compliance deadlines for 2013 and beyondPosted 20 days ago
- The wellness path not takenPosted 23 days ago
- Many workers aren’t ready for health care reformPosted 24 days ago
- Top Dem Sees ‘train wreck’ for PPACAPosted 27 days ago
- Health Care Reform Cost Drivers – Next Power U Session April 24thPosted 27 days ago
- Young Adults Should Have Reasonable Plan Options On ExchangesPosted 41 days ago
- 3-year anniversary: Important milestones for PPACAPosted 45 days ago
- The Affordable Care Act Three Years Post-EnactmentPosted 46 days ago
Numbers show wellness programs more advantageous in mid-market
According to Businessinsurance.com , Midsize employers have several advantages over their larger counterparts in implementing wellness programs and benefitting from their results, whether the employer is insured or self-insured.
Moreover, mid-market employers that incorporate wellness programs into their business strategies will see benefit costs slide while boosting morale and enhancing productivity.
Numbers show wellness programs more advantageous in mid-market
Midsize employers have several advantages over their larger counterparts in implementing wellness programs and benefitting from their results, whether the employer is insured or self-insured, experts say.
Moreover, mid-market employers that incorporate wellness programs into their business strategies will see benefit costs slide while boosting morale and enhancing productivity, the experts say.
In fact, a recent initiative that Bloomfield, Conn.-based CIGNA Corp. introduced in the 50- to 250-member “CIGNA Select” group life market acknowledges the impact of wellness programs. Employers that achieve high participation rates in wellness programs could be eligible to receive premium discounts ranging from 2% to 6%, depending on the type of program, the company confirmed.
It comes down to math: 90% participation rates at a company with 250 employees can have a greater effect on an organization than a 90% participation rate at a 5,000-life company, experts note.
But not all insurers have been as willing to share with small and midsize employers the savings that wellness and health promotion programs can produce, according to consultants who work on their behalf.
That’s why Scottsdale, Ariz.-based consultant Benefit Commerce Group, formed by two former insurance industry executives, developed its “trend neutralizer,” which uses the same data that insurers use to show investors and analysts how a company’s wellness and consumer-directed health strategies reduce their health care costs. The consultant uses that data to seek health care premium reductions for employers that have adopted similarly aggressive health promotions.
For example, if insurers’ data shows that 75% to 99% of a company’s employees participating in annual physicals with biometric screenings can shave 2% off medical inflation, then that reduction should be afforded to employers that have achieved that level of participation through lower premiums, said Chris Hogan, president of Benefit Commerce.
“We’ve developed this process, system and algorithms using insurers’ own data” and asked them, “Why isn’t this being applied across the insurers’ books of business?” Mr. Hogan said.
“One thing that the industry has told employers for years is that consumerism and wellness will not impact your claims immediately, but it will in the future,” said Scott Wood, a principal at Benefit Commerce. “Well, the future is now. It’s kind of fun to turn that back on the carriers.”
However, for at least one midsize employer, it took becoming self-insured before they fully realized the benefits of wellness on their health costs.
For example, Wichita, Kan.-based Meritrust Credit Union broke from its insurer when it failed to see reductions in premium commensurate with the inroads it was making in its wellness program, said Byron Stout, vp of human resources.
Eleven months after becoming self-insured and with providing financial incentives to encourage its 220 employees to be healthy physically, emotionally and financially, Meritrust Credit Union’s health care costs are 24% below budget, Mr. Stout said.
In Meritrust’s three-tiered wellness program, managed by the Wichita office of broker IMA Inc., employees receive points and financial incentives for exercising and healthy eating, reducing debt and boosting savings, or taking part in community events. Those who receive the required level of points are eligible for a “premium holiday” in which they are not required to make their regular biweekly health plan premium contribution.
“We actually reward that “wellness warrior’—not just for dropping 30 pounds, but for making other life changes that make them a more happy, satisfied employee because we know that when our employees are happy, it reflects on their work and extends to our customers,” Mr. Stout said.
Once a midsize employer becomes self-insured, they have the greatest “opportunity to benefit from health risk management,” said Marcia Benshoof, president of IMA Benefits in Denver.
Regardless of whether they are fully insured or self-insured, mid-market employers’ smaller size can make it easier for them to implement a wellness strategy, said Aron Minken, a director of PricewaterhouseCoopers L.L.P. in New York.
“Just by virtue of their size alone, (midmarket employers) are a bit more nimble,” he said. “They think about things in a much more practical way. Usually there’s a much more apparent sense that the (chief financial officer) is involved and the employee benefits is among the single largest line items in the expense, so it gets their attention.”
Midsize employers also can take quicker advantage of the results of wellness programs, Ms. Benshoof said. “There are some instant results if you do (health risk assessments). You’ll find some ticking time bombs and perhaps save some lives,” she said.
Not all successful midmarket wellness programs require investing as much resources as might be required at a large, multistate employer, said Lisa Raasch, president of Empower Change, a consulting business in Muskogee, Okla., who serves on the Greater Muskogee Area Chamber of Commerce’s newly formed Wellness Task Force.
“The fact is, it doesn’t have to cost a lot of money to change the culture into one that appreciates health and wellness,” she said.
Robin Bouvier, vp at Aon Hewitt Inc. in Boston, suggested that midmarket employers start by recruiting a wellness committee and then providing a forum for them to share their passion with others.
“These people become cheerleaders for the organization and encourage their peers to take a more active role in their health through exercise, making healthy food choices,” she said.
“The best employers are doing this because it’s what the best employers do. They do it to attract and retain the best people who are willing to work really hard,” said Chris Dickinson, chief revenue officer at Limeade Inc., a Bellevue, Wash.-based wellness provider.
“It’s about investing in people as opposed to managing health risks, viewing people as bundles of potential rather than as units of health risk. That’s what it takes to have a vibrant, dynamic culture,” he said.