Building a Successful Health Management Strategy

Why Health Management? Researchers estimate that preventable illness makes up 70% of the total health care cost. – New England Journal of Medicine Obese individuals generate 2x the number of WC claims and 13x more lost days from work compared to individuals maintaining a normal Waist Circumference/ Body Mass Index. – Duke University 66% of adult Americans are overweight/obese. – CDC & Prevention 2

A Well Designed, Long-Term Health Management Strategy… Improves the health and well-being of employees (& their families) Enhances employee morale and productivity Enhances organizational performance Reduces costs Provides an example to the community 3

Where WE Are Going… Our goal is to implement a long-term strategic plan with engagement across the organization, an effective communication strategy and meaningful incentives that drive participation, behavior change and cost- containment 5

Program Components Health (Biometric) Screenings Campaign (On-site or PCP) Health Risk Assessment Questionnaire Campaign Lifestyle Management Disease Management Routine Annual Exams Health Improvement Programs & Activities (Ergonomics, Safety, Weight Management, Tobacco Cessation) Value Base Benefits Design 6

Target Population All Insured Employees All Employees & Insured Spouses Incentive Strategy 2011 & 2012 Incentive based on participation in: 1. Health Risk Assessment (HRA) 2. Biometric Screening- PCP or onsite -Q Incentive based on participation in: 1. HRA 2. Biometric Screening 3. Routine annual Exams (age/gender) 4. Health Improvement Programs/Activities 2014 Incentive based on participation in: *1. HRA *2. Biometric Screening 3. Routine annual Exams (age/gender) 4. Health Improvement Programs/Activities *If the spouse does not participate, the employee does not receive the discount 2015 Incentive based on participation in: *1. HRA *2. Biometric Screening 3. Routine annual Exams (age/gender) 4. Meet Established Biometric Standards &/or participate in alternative standard *If the spouse does not participate, the employee does not receive the discount Incentives2011 Raffle Medical Premium Discount (Max: 20% of TOTAL annual medical premium of EE) Medical Premium Discount (Max: 20% of TOTAL annual medical premium of EE) Medical Premium Discount (Max: 20% of TOTAL annual medical premium of EE) Medical Premium Discount (Max based on HCR: 30% of annual medical premium for EE, ES & EF) Goal(s)1. Establish based line data for HRA and screenings 2. Provide aggregate risk data to employees 3. Provide individual risk data to employees 1. Increase/Maintain participation in HRA & Biometric Screenings 2. Measure Risk Reduction 3. Establish baseline data in programs & activities 1. Increase/Maintain participation in HRA & Biometric Screenings 2. Increase/Maintain participation in programs & activities 3. Measure Risk Reduction of the population 4. Measure prevalence & trends of cohort population 1. Increase/Maintain participation in HRA & Biometric Screenings 2. Increase/Maintain participation in programs & activities 3. Measure Risk Reduction of the population 4. Measure prevalence & trends of cohort population Action Items Q3 1. Define accountability 2. Brand Program & Develop Mission Statement 3. Develop an effective communication strategy with leadership endorsement 4. Determine budget & resources 5. Determine Incentive structure Q4 6. Launch HRA and Biometric Screening Campaign 1. Implement Program/Activities based on aggregated risk data 2. Launch HRA and Biometric Screening Campaign 1. Engage Insured Spouses1. Implement Value Based Benefits Design 7 Sample Strategy –Using Carrier/TPA Model

MEDICAL PREMIUM DISCOUNT BONUSSWEEPSTAKESPTO REWARDUp to 20% of employee + employer contribution Amount: TBD Cash Bonus Amount: TBD Grand Prize Drawing for a large give-away Prize(s): TBD Paid Time Off Amount: TBD CRITERIA Year 1 Participate in Biometric Screening + HRA Participate in Biometric Screening + HRA Participate in Biometric Screening + HRA Participate in Biometric Screening + HRA PROS-Non-taxable -Depending on structure, provides for program funding -Educates employees on the true cost of their medical benefit -Customizable -High Consumer Demand, tangible reward -Consumer ease of use -Addresses non-insured employees -No limit to incentive -Customizable -High Consumer Demand, tangible reward -Consumer ease of use -Fixed budget cost -Addresses non-insured employees -No limit to incentive -Customizable -High Consumer Demand, tangible reward -Consumer ease of use -Addresses non-insured employees -No limit to incentive -Customizable CONS-Does not reward non insured employees -maintain 100% employer paid medical insurance, if applicable -non-tangible reward -Administration -Incentive limitations -Tax implications -100% cost to the employer, does not provide program funding -Administration & delivery -Tax implications -100% cost to the employer, does not provide program funding -Administration & delivery -Lack of reward for all participants -100% cost to the employer, does not provide program funding -Administration & delivery Sample Incentive Strategy

The Success of the Program Hinges on Engagement of the Target Population The following components are critical to engagement: Senior Executive Level Support An Effective Communication Strategy Meaningful Incentives Measurable Outcomes 62% of U.S. companies use incentives to motivate participation and behavior change. -Working Well: A Global Survey of Health Promotion and Workplace Wellness Strategies,

12 Stand-alone VendorMedical Carrier Benefits Customization Flexibility HRM is their focus Dedicated account management If you move Carriers you don’t lose your programming Availability of programming for non-insured members & their family Individualize intervention based on results Ability to brand program and provide to the community (free & fee based) Brand recognition and trust Data & program integration across the continuum of care Enhanced engagement strategies and opportunities Single point of access for participants Individualize intervention based on results Cost Challenges Program integration across the continuum of care more difficult to achieve Data integration/ownership Cost Availability of programming for non-insured members & their family Risk data now available to the Carrier Leaving Carrier would result in loss of programming & employee engagement No dedicated account management for health risk management Flexibility Program Comparison

Health Risks Chronic Illness Medical Cost Injury Risk Disability Cost Absenteeism Presenteeism Top Down Support Defined Accountability Communication Cultural Change Incentives Awareness Education Individualized Intervention Plan Design Behavior Change Healthier Employees Happier, More Productive Employees Derivable Gains Health Plan Costs Sick Leave Costs Workers’ Compensation Costs Disability Costs Presenteeism Costs Potential Gains Quality Consumerism Stamina & Resilience Cultural Shift Company Loyalty Morale Recruitment Retention A Framework for Success INTERVENTIONSNEEDSEFFECTSIMPACT Source: Leutzinger, J., Sullivan, S. & Chapman, L. The Platinum Book: Practical Applications of the Health & Productivity Management Model. IHPM, 2004 Pharmacy Cost Engagement 9

Building a Successful Health Risk Management Strategy Discussion 13