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Corporate Wellness Adds to the Bottom Line Creating a Productive and Healthy Workforce The material provided herein is for informational purposes only.

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Presentation on theme: "Corporate Wellness Adds to the Bottom Line Creating a Productive and Healthy Workforce The material provided herein is for informational purposes only."— Presentation transcript:

1 Corporate Wellness Adds to the Bottom Line Creating a Productive and Healthy Workforce The material provided herein is for informational purposes only and is not intended as legal advice or counsel.

2 Please help yourself to food and drinks Please let us know if the room temperature is too hot or cold Bathrooms are located past the reception desk on the right Please turn OFF your cell phones Please complete and return surveys at the end of the seminar

3 Wellness Programs In The Beginning… Charles Bruder

4 November 2, 2011 Corporate Wellness Adds To The Bottom Line!!

5 Why Wellness?  Health Care Costs: Costs projected to jump 9% in 2011 (PriceWaterhouse Coopers, June 2010)  Most Illnesses Can Be Avoided: Preventable illnesses make up approximately 70% of the entire burden of illness and associated costs in the United States (WELCOA, Six Reasons for Worksite Wellness)  Expanding Work Week: Typical American now works 47 hours a week, 164 more hours than only 20 years ago. (Julien Schor, Harvard Economics professor)  Increased Stress Levels: 78% of Americans describe their jobs as stressful and the vast majority indicate stress levels have worsened over past ten years. (WELCOA, Six Reasons for Worksite Wellness)

6 WHY WELLNESS PROGRAMS? RISING COST OF HEALTH CARE

7  High Adoption Rates: More than 81% of America’s business with 50 or more employees have some form of health promotion program (WELCOA)  Lower Health Care Costs: Wellness programs reduce health care costs for companies by about 26% and cut sick leave by an average of 28% (American Journal of Health Promotion, 2010)  Effective Recruitment/Retention: 22 of Fortune magazine’s “100 Best Companies to Work For” – businesses that enjoy national recognition for desirable benefit packages, plan to add a total of 87,750 jobs this year. (Fortune magazine Top 100 Companies to Work For, February 23, 2010) Recent “Proof” Points That Wellness Works

8 Reduce employee healthcare costs Increase employee productivity Reduce absenteeism Reduce disability and workers’ compensation costs Promote healthier, more satisfied workforce Improve corporate profitability WHY WELLNESS PROGRAMS?

9 WELLNESS PROGRAMS Employee Productivity

10 WORKSITE WELLNESS PROGRAMS

11 WELLNESS PROGRAMS How Do Your Employees Stack Up? Statistically, for every 100 employees in your company: 5 have diagnosed diabetes 10 have undiagnosed diabetes 12 are heavy drinkers 15 are bothered by excess stress 23 have total cholesterol (>240) 27 have no regular exercise 29 have elevated blood pressure 33 use tobacco products 46 have high overall coronary risk 60 are outside recommended weight range Source: Center for Disease Control

12 WELLNESS PROGRAMS Plan Design Options Program Model Quality of WorkLife Main Features Primary Focus Fun activity focus No risk reduction No high risk focus All voluntary Site-based only No personalization Minimal incentives No spouses served No evaluation Morale-Oriented Traditional Approach Health and Productivity Management Mostly health focus Some risk reduction Little high risk focus All voluntary Site-based only Weak personalization Modest incentives Few spouses served Weak evaluation Activity-Oriented Add productivity Strong risk reduction Strong high risk focus Some reqd activity Site and virtual both Strongly personal Major incentives Many spouses served Rigorous evaluation Results-Oriented

13 WELLNESS PROGRAMS The Quality of WorkLife Model Quality of WorkLife A good “fit” with: Smaller worksite ROI low priority New to wellness Not sure about EE reaction Limited follow-through capability Weak corporate direction

14 WELLNESS PROGRAMS The Quality of WorkLife Model Primary Wellness Targets Fun events Stress relief Nutrition Community service General wellness information General health information Participation: 15% to 35% Approximate Cost/EE/Yr: <$45 Likely ROI: <1:1.0 Quality of WorkLife Typical Activities  Health fair  Lunch and learn sessions  Wellness “event”  Community sponsorship  Chair massage option  Free fruit  Wellness materials in HR  Health cartoons circulated  Nutritious pot lucks  Movie events  Company games  Celebrity event

15 WELLNESS PROGRAMS The Traditional Model Traditional Approach A good “fit” with: Medium size or larger worksite ROI moderate priority 2-10 years of wellness Employee reaction a concern Some follow-through capability Follows corporate direction

16 WELLNESS PROGRAMS The Traditional Model Primary Wellness Targets Everything from the QWL Model plus… OWS Cholesterol Blood pressure Tobacco use Obesity Medical self-care Physical activity Participation: 28% to 58% Approximate Cost/EE/Yr: $46- $150 Likely ROI: 1:1.5 to 1:3.0 Traditional Approach Typical Activities Everything from the QWL Model plus…  Health risk assessment (HRA)  Biometric testing option  Fitness club memberships/facility  Weight management program  Smoking cessation program  Web-based health information  Healthy cafeteria/vending options  Self-care book  Preventive medical benefit coverage  Wellness newsletter  Short term incentive program

17 WELLNESS PROGRAMS The HPM Model Health and Productivity Management A good “fit” with: Larger work force ROI very high priority Very mature wellness Prepared to educate employees Strong follow-through capability Strong virtual corporate program and site-driven

18 WELLNESS PROGRAMS The HPM Model Primary Wellness Targets Everything from the TA Model plus… Productivity Injuries (All) HC utilization issues Presenteeism Resiliency Integrated programming Health consumerism Participation: 65% to 95% Approximate Cost/EE/Yr: $250-$450 Likely ROI: 1:2.5 to 1:6.5 Health and Productivity Managemen t Typical Activities Everything from the TA Model plus…  HRA (incented and used for targeting with 80% minimum)  Risk stratification and incented interventions  Telephonic coaching  Medical self-care and consumer workshop  Injury prevention  Benefit linked incentive  Wellness achievement incentives  Resiliency initiative for productivity  Spouses also served  Integrated programming (Level I & II)  Uses HPM framework  Onsite Clinic

19 WELLNESS PROGRAMS Return on Investment

20 WELLNESS PROGRAMS Category 2011 Wellness Goals 2012 Wellness Goals 2013 Wellness Goals Participation in HRAComplete Tobacco/Nicotine: Affidavit: Tobacco Free -or- Completion of Smoking Cessation Program Negative Test Result -or- Completion of Smoking Cessation Program Negative Test Result -or- Completion of Smoking Cessation Program Physical Activity Completion of Shape Up the Nation Walking Challenge Completion of Shape Up the Nation Physical Activity Challenge Completion of Shape Up the Nation Physical Activity Challenge Blood Pressure:Participate<135/90<120/80 Glucose:Participate< 110< 100 Cholesterol:Participate<4.0(Cardiac Ratio) Body Mass Index:Participate<30.0<25.0 Benefit Advisory Coaching:ParticipateComplete Impact Up to 20% Reduction in Premium Contribution Up to 20% Reduction in Premium Contribution Up to 20% Reduction in Premium Contribution Sample Incentive Program Design:

21 Incent Participants to Drive High Engagement & Reward Healthy Choices  Incentive can range from small tokens to 20% premium reduction  Gradual progression from activity to results based  Must have a “Wellness Champion” on the management team  Consider a “turnkey platform”  Employee portal drives engagement  Questions…..

22 WELLNESS PROGRAMS How Benefit Sources & Solutions Can Help Certified Wellness Planning Coordinators Wellness program design assistance Health fair coordination Incentives/penalty program recommendations Preferred vendor partnerships and referrals Quarterly e-newsletters Compliance issues guidance

23 Wellness Programs, Compliance Issues and Potential Hidden Costs (or how a good idea can go bad) Charles Bruder

24 SMART Health Partners, LLC Maximizing Workforce Health WELLNESS AS A BUSINESS STRATEGY Nora Tsivgas President & CEO

25 How Is Wellness a Business Strategy?  PEOPLE – Employee satisfaction is the #1 metric used to assess the impact of benefit design changes and programs implemented to support healthy behaviors.  PRODUCTIVITY – Healthy employees miss fewer days of work and are more productive at work.  PROFITABILITY -- Utilization of prevention and wellness strategies leads to lower utilization of the most costly health services. Healthy Employees = Increased Profitability

26 Wellness as a Business Strategy People are motivated by the health benefits they receive from your company and those benefits can be leveraged to motivate healthy behavior choices that can increase the value of your workforce. A healthy workforce costs your company less. Healthy employees are more productive and incur fewer health complications that cost your company in lost work days and higher claims costs. Preventive health strategies keep your employees well – physically, mentally, emotionally and don’t require exorbitant financial investments. Building a culture of health within your company can be an effective and measurable business strategy. A strategic approach to managing your company’s investment in health benefits and programs is essential in these days of rising healthcare costs. Benefits Health Wellness

27 The Call to Action is Hard to Ignore 75 % % of US healthcare dollars spent in 2007 on treating patients with one or more chronic diseases * Non-institutionalized U.S. population General Population 96 % Medicare 83 % Medicaid In a five year span, two- thirds of the rise in healthcare spending was due to the rise in treating chronic diseases.* - Many cases could be prevented. - Most could be better managed. 2/3

28 Prevention vs. Chronic Disease - Reverse the “Flow”  Costs follow risk – the greater the number of risk factors, the higher the cost  A culture of health that promotes healthy behaviors may prevent or slow progression of disease and keep employees as healthy and low cost as possible – to the left side of the risk continuum Disease – with Complications Established Disease General Wellness $ Presence of Risk Factors for Disease Edington DW. N C Med J. 2006;67(6):425–427; Mahoney JJ. J Manag Care Pharm. 2008;14 (6 Suppl B):3–8; National Business Group on Health. Issue Brief. March Washington, DC; $$$$$$$$$ “The Natural Flow of Health Risks…is Toward High Risk in the Absence of Programs Targeted at Maintaining the Population at Low Risk” – Dee Edington, PhD

29 50% of the population is well or has risk factors 5% with complications 35% with established conditions  Most health care strategies focus on the 5% in the “sickest” category  While this may yield short- term savings, to provide quality, cost-effective care, the employer needs to manage the entire population 10% of cost 15% of cost 75% of cost 5% of Employees Can Account for 75% of Cost Percentage of Healthcare Costs Attributable to Employees in Different Health Categories* * Total of risk groups = 90% of the employee population; 10% of employees were nonusers of health services. Source: Adapted from Mahoney JJ. J Manag Care Pharm. 2008;14(6 Suppl B):3–8. (Pitney Bowes Case Study)

30

31 15%

32 Health Risks: Behaviors, Conditions, Events Uncontrollables: Age Gender Family History Genetics Identifying Health Risk in the Organization Behaviors: Smoking Poor nutrition: <5 servings of vegetables/day Lack of exercise: <60 minutes/day 5x/week Inconsistent compliance preventive health measures / screenings/ annual physicals and medications. Uncontrolled Conditions: High blood pressure High blood glucose (sugar) Obesity : BMI>30 Undiagnosed cancer Unmanaged Stress/Anxiety/Depression Events: Heart Attack Stroke Cancer Diagnosis

33 What is Obese? Overweight Obese Normal

34 Identifying Health Risk in the Organization Eyeball National/regional benchmark data Employee Surveys Health Risk Assessments Biometric Screening data Medical and Pharmacy Claims data Premiums* o Medical Claims o Pharmacy Claims Disability – illness or injury Workers compensation Lost productivity due to illness or injury Health Risk: Behaviors, Conditions, Events Financial Risk: Total Cost of Care * Degree of impact increases from community-rated to experience-rated to self-funded. Self-funded employers would look directly at medical and pharmacy claims vs. premiums.

35 50% of the population is well or has risk factors 5% with complications 35% with established conditions The 15 most expensive health conditions account for 44 percent of total healthcare expenses Top 5: heart disease, cancer, trauma, mental disorders and pulmonary disorders People with multiple chronic conditions cost up to seven times as much as people with only one chronic condition 10% of cost 15% of cost 75% of cost Percentage of Healthcare Costs Attributable to Employees in Different Health Categories* 5% of Employees/Dependents Can Account for 75% of Your Healthcare Cost * Total of risk groups = 90% of the employee population; 10% of employees were nonusers of health services. Source: Adapted from Mahoney JJ. J Manag Care Pharm. 2008;14(6 Suppl B):3–8. (Pitney Bowes Case Study)

36 50% of the population is well or has risk factors 5% with complications 35% with established conditions The 15 most expensive health conditions account for 44 percent of total healthcare expenses Top 5: heart disease, cancer, trauma, mental disorders and pulmonary disorders People with multiple chronic conditions cost up to seven times as much as people with only one chronic condition 75% of cost Percentage of Healthcare Costs Attributable to Employees in Different Health Categories* “Can we mitigate the trend?” * Total of risk groups = 90% of the employee population; 10% of employees were nonusers of health services. Source: Adapted from Mahoney JJ. J Manag Care Pharm. 2008;14(6 Suppl B):3–8. (Pitney Bowes Case Study) 10% of cost 15% of cost

37 50% of the population is well or has risk factors 5% with complications 35% with established conditions The 15 most expensive health conditions account for 44 percent of total healthcare expenses Top 5: heart disease, cancer, trauma, mental disorders and pulmonary disorders People with multiple chronic conditions cost up to seven times as much as people with only one chronic condition 75% of cost Percentage of Healthcare Costs Attributable to Employees in Different Health Categories* Can we prevent migration from risk to chronic disease? * Total of risk groups = 90% of the employee population; 10% of employees were nonusers of health services. Source: Adapted from Mahoney JJ. J Manag Care Pharm. 2008;14(6 Suppl B):3–8. (Pitney Bowes Case Study) 10% of cost 15% of cost

38 50% of the population is well or has risk factors 5% with complications 35% with established conditions The 15 most expensive health conditions account for 44 percent of total healthcare expenses Top 5: heart disease, cancer, trauma, mental disorders and pulmonary disorders People with multiple chronic conditions cost up to seven times as much as people with only one chronic condition 75% of cost Percentage of Healthcare Costs Attributable to Employees in Different Health Categories* Can we shrink the cost of healthcare and grow the size and strength of our workforce? * Total of risk groups = 90% of the employee population; 10% of employees were nonusers of health services. Source: Adapted from Mahoney JJ. J Manag Care Pharm. 2008;14(6 Suppl B):3–8. (Pitney Bowes Case Study) 10% of cost 15% of cost

39 How Does Productivity Affect Profitability GAINS Days of physical presence at work Hours mentally present at work Bursts of creativity that result in meaningful outcomes Brand Stewardship LOSSES Absenteeism Presenteeism Time spent distracted by family/personal responsibilities / stress Productivity: Measurable production per employee or group per time period X# of cars washed per day X# of phone calls handled per hour

40 Lost Productivity Has a Measurable Impact (Total # of employees * prevalence) * (average annual salary * % avg productivity lost) = Annual $ lost productivity due to that condition Example: 200 employees with a 17.5% prevalence of flu, an average annual pay of $50,000, losing 4.7% productivity due to flu (equivalent of 7 days out of work and 7 days at half presenteeism = $70,000/year

41 Worksite health promotion programs can yield a $3 to $6 return on investment for every dollar spent over a 2- to 5-year period 46% of employees participating in on-site smoking cessation program quit; 48% smoked less – L-3 Communications Classes and fitness training offered to prevent back injuries resulted in increased employee morale, reduced worker’s comp claims, medical costs and sick days related to back injuries producing a net cost- benefit ratio of 1 to 1.79 – County in California Participants in their “Stay Alive & Well” program significantly lowered cholesterol levels, blood pressure and weight and experienced 21% lower lifestyle-related claim costs than non-participants. Resulting savings: $ per participant with a benefit to cost ratio of 1.68 to 1 over two years. – Reynolds Electrical & Engineering Company, Las Vegas 22% fewer admissions to a hospital, 29% shorter hospital stays, and 42% lower expenses per admission – Superior Coffee and Foods, Illinois Employees whose lifestyles included two to four health risks such as smoking, little exercise, overweight— were 75% higher than those of low-risk employees. High-risk employees who improved their health habits through the company’s health promotion program and became low risk cut their average medical claims in half, lowering their medical insurance costs by an average of $618 per year. – Steelcase ¹Harvard Business Review, December 2010, W. Braun, What’s the Hard Return on Employee Wellness Programs? Reference: The Cost Benefit of Worksite Wellness, J&J‘s leaders estimate that wellness programs have cumulatively saved the company $250 million on healthcare costs over the past decade, from 2002 to 2008, the return was $2.71 for every dollar spent.¹

42 Where to Begin Capture CEO Support Designate a Company Wellness Leader Conduct an Employee Health Interest Survey Provide an Opportunity for Health Screening Administer an Annual Physical Activity Campaign Hold a Healthy Eating In-service/Lunch 'n Learn Establish an In-house Wellness Library Disseminate a Quarterly Health Newsletter Implement Healthy Policies and Procedures Support Community Health Efforts ¹Wellnss for Small Business, Welcoa, Engage a Broker or Consultant to Design an Comprehensive Strategy

43 Some Business Philosophies Underlying A Successful Wellness Strategy  Companies (must) offer health benefits in order to compete for talent in the local marketplace  Healthcare cost affects companies’ bottom line  Health risk drives healthcare utilization and cost  Health behaviors drive health risk  Health status affects productivity, both physical and mental/creative, and productivity affects your bottom line  Employees will practice smarter health behaviors if properly motivated  A culture of health at work has significant impact on and value to employees and their families

44 Conclusion: Wellness IS a Business Strategy 1.Assess goals annually 2.Stay “on message” in promoting healthy lifestyles to employees 3.Build and leverage buy in from the top of the organization Plan for Success Success takes time: 3 year vision 1.Assess: Baseline Risk and Wellness Needs 2.Develop or Purchase: High Quality Wellness Services 3.Communicate: Your Wellness Program and Culture Change 4. Measure: The Success of Your Culture Shift Benefits Health Wellness

45 Nora Tsivgas President & CEO SMART Health Partners, LLC 16 Mt. Bethel Drive, Suite 238 Warren, NJ Wellness As a Business Strategy SMART Health Partners’ Role  General Assessment and Program Design Baseline Prioritization Goal Development Strategic Plan  Implementation Budgeting Cost Neutral Resources Vendor Management Engagement Data Collection  Measurement of Results Translation of Value “Marketing” of Results

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47 Hall’s is comprised of three enterprises –Hall’s Warehouse Corp. –Hall’s Fast Motor Freight –Hall’s Logistics Group Inc. Hall’s Warehouse Corp. founded in 1966 “To provide superior logistical services in a manner that meets or exceeds the requirements of Hall’s clients while enhancing our competitive position in the market place” Mission Statement

48 ▪ Kentile Campus, South Plainfield, NJ (Headquarters) - Hall’s Fast Motor Freight Inc. ▪ Oak Tree facility, South Plainfield, NJ ▪ Edison facility, Edison, NJ ▪ Bridgewater facility, Bridgewater, NJ ▪ Piscataway 120 & 140 facilities, Piscataway, NJ Operate over 1,651,000 square feet of dry, refrigerated and frozen storage 5 facility locations encompassing 7 warehouse operations

49 Service retail and food service customers and manufacturers in the north east market We cross-dock and transport over 25mm lbs per month for our largest consolidation client Hall’s Fast Motor Freight Asset Based 75 unit regional carrier Hall’s Logistics Corp. (Strategic Carrier Partnership)

50 1) Concern with the direction of healthcare costs - Average increase of healthcare costs 10% since ) Compliance, Safety, Accountability (CSA) ▪ Close monitoring and evaluating the safety and compliance records of motor carriers and their drivers ▪ Taking rapid action against those with apparent safety problems, to get them to improve 3) Other avenues ineffective 4) Firm belief in having “feet on the ground” in order for lasting behavior change to occur

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52 I’m a Resource for employees! Personalized & Customized 100% Voluntary 100% Confidential

53 Ways I Can Help? Lose Weight Exercise More Stop Smoking Eat Better Manage Aches & Pains Research Topics Answer General Health Questions Reduce Stress

54 Proactive Education Blood Pressure Screenings Other components of our program Body Composition Testing Lunch & Learns Programs or Competitions Weight Loss Smoking Cessation Nutrition Exercise Programs

55 January – Health Risk Assessments ▪ 72% participation ▪ Overall wellness score was 60 ▪ Top 4 areas of concern: Nutrition, Exercise, Weight, Stress May – The Biggest Loser (3 month weight loss program) ▪ 90 employees participate ▪ 260 pounds of body weight lost December – Fitness Center Program ▪ Partnered with local health club ▪ Discounted rates offered to employees and family members ▪ Over 80 employees have participated in program

56 January – Health Risk Assessments ▪ 85% participation ▪ Overall wellness score was 67 ▪ Large improvements seen in Blood Pressure, Exercise, Smoking, and Stress. March – Compete to Quit (3 month Tobacco Cessation program) ▪ New Jersey Tobacco Control Worksite Program ▪ 28 participants and 11 employees quit smoking July – Tobacco Free Workplace Policy ▪ All tobacco products prohibited throughout all Hall’s locations ▪ Tobacco cessation resources were available 6 months prior to policy implementation date

57 January – Take Shape for Life (Nutritional intervention program) ▪ Weekly weigh-ins ▪ Before pictures and circumference measurements ▪ Bi-weekly onsite classes February – Slim Down or Pay Up (3 month weight loss program) ▪ 40 employees participated ▪ 33 employees completed program (3 weigh-ins, 1 per month) ▪ 530 pounds of body weight lost collectively December – Hall’s Health & Wellness Program ▪ Create brand, logo, and vision statement ▪ Introduce new internal wellness newsletter (biannual)

58 January – Health Risk Assessments (third round) ▪ Incentives for completion of HRA and Biometric Measures ▪ Planning to offer onsite blood testing (cholesterol, blood sugar etc.) March – Tobacco Cessation program (second) ▪ Alongside Healthyroads Quit & Fit program (AETNA) ▪ Prior to implementation of tobacco surcharge July – Tobacco Surcharge ▪ Monthly increase to the health insurance premiums of tobacco users Additional plans for 2012 ▪ ROI▪ Family Health Fair ▪ Pedometer walking program▪ Rx savings information (generic, mail- order)

59 BeforeCurrent Body Weight Lost - 84 pounds Reduction in Body Fat Percentage - 21% Blood Pressure Was: 152/98 Now: 104/72 No prescribed medications Meets DOT health requirements

60 BeforeCurrent Body Weight Lost pounds Reduction in Body Fat Percentage - 23% Discontinued use of prescribed high blood pressure medication. Recently completed first 5K run (33 mins)

61 Question & Answer Session Thank you for coming!


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