George Pantos: Employer wellness programs vital Rx for health reform

The writer, of Bethesda, Md., is executive director of the HealthCare Performance Management Institute.

Wellness programs will prove crucial to the success — or failure — of efforts to reform our health care system.

Much of the $2.3 trillion spent annually on health care goes to treat preventable conditions brought on by unhealthful living. Any attempt to rein in health spending must therefore stem the rise of preventable illnesses and encourage people to take greater responsibility for their health.

For the two-thirds of Americans who get their insurance coverage through work, employer-sponsored wellness programs are a perfect means of doing so.

Americans are succumbing to preventable diseases at alarming rates. Every year, according to the New England Journal of Medicine, 465,000 Americans die from smoking-related illnesses, 395,000 die from high blood pressure, and another 216,000 die from conditions related to obesity.

These numbers shouldn’t come as a surprise. Roughly half of American adults suffer from at least one chronic disease. One-third of adults — and one-fifth of those between the ages of 6 and 19 — are obese.

Treating these conditions isn’t cheap. Chronic diseases like diabetes, heart disease and cancer consume three-quarters of U.S. health care expenditures.

It’s only logical to conclude that prevention of these expensive illnesses from ever taking root could deliver savings to the health care system. Indeed, 70 percent of health care costs are tied to behavior. Wellness programs that curb unhealthy lifestyles therefore hold promise for reduction of overall health costs.

Researchers at Harvard have found that every dollar spent on workplace wellness programs saves more than $3.27 in medical expenses. What’s more, since these programs reduce the number of days employees stay home sick, every dollar spent on wellness initiatives saves another $2.73 due to increased productivity.

Eager to realize such savings, many companies are actively encouraging their employees to stay healthy. Consider the case of grocery titan Safeway.

The supermarket chain charges employees different insurance premiums depending on four factors: blood pressure, tobacco usage, weight and cholesterol levels. Workers who meet acceptable standards in all four categories receive a $780 break on individual policies and a $1,560 break on family policies. In other words, employees effectively receive raises for staying healthy.

As a result, Safeway’s overall health care costs have remained flat since 2005 — even as most other companies’ costs have risen 38 percent.

Such wellness programs are at the core of a successful “Health Care Performance Management” (HPM) strategy. HPM allows companies to harness anonymous data on their employees’ potential health risks and then take proactive steps to mitigate those risks.

For instance, firms might use HPM data to identify individuals at risk of developing chronic conditions like high blood pressure and then tailor their health benefits accordingly. These employees might be offered access to low-cost gym memberships, discounted prescription drugs or one-on-one coaching with medical professionals or nutritionists.

Such initiatives can save big bucks. According to the Milken Institute, addressing risk factors like unhealthy behavior could result in 40 million fewer cases of chronic illness and reduce health care spending by $1.1 trillion by 2023.

It’s no surprise, then, that 60 percent of employers are likely to create or expand their wellness programs, according to a survey conducted by the Midwest Business Group on Health.

If businesses have any hope of cutting their health care costs, they must encourage their employees to take better care of themselves.

This essay reflects the writer’s views and not necessarily the editorial position of The World-Herald. To contact the writer: pantos@hpminstitute.org.

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