An Ounce of Prevention . . .
An employee has a heart attack. Besides concern for the person and the loss of productivity, you can't help but worry about your insurance rates, especially with premiums already skyrocketing 15 percent a year or more. Prolonged illness is a nightmare for employers and employees.
Over the past decade, large employers have tried to control health-care costs through preventive measures such as disease management, a "nip it in the bud" approach that targets high-risk employees and helps them manage chronic conditions--high cholesterol, hypertension and so on--before they turn into bigger, costlier, problems.
Now these programs are available to a wider spectrum of businesses, and the hard sell will pick up as the economy does. "We see an increase in the amount of disease management services being offered and accepted in the workplace, including smaller employers," says Gene Miller, CEO of Landacorp, a disease management company based in Atlanta.
Thanks, but No
The biggest obstacle to making disease management programs work is getting employees to participate. Some programs may be seen as career-busters. "If I sign up for the diabetes [seminar], I'll get off the promotion route because you're afraid my health won't withstand it," says Nan Andrews Amish, an El Granada, California, health-care consultant.
Small employers will face big challenges in protecting employee privacy, simply because their workplaces are small. Employees may be discouraged if a sign-up sheet for depression assessment or HIV screening is posted where everyone can see.
To encourage participation, start by protecting privacy. Make sure health information that can be linked to specific employees can't be accessed by anyone in the company. Sign-ups should be strictly confidential.
Tell employees in writing how information will be used and to whom it will be disclosed. "You'll need firewalls between your company and the provider so employment decisions can never be made based on the information," says Joanne L. Hustead, senior counsel for the Health Privacy Project at Georgetown University in Washington, DC.
At a time when other companies are dropping wellness programs, Sucheta Jain, co-founder and COO of Intelligent Information Systems, a software services company, in Durham, North Carolina, spent $7,000 in 2002 on stress management seminars, healthy snacks and an employee assistance program. It's worth the cost, says Jain, 44. "In these times," she says "they're needed even more."
The cost of disease management programs typically ranges between $1 and $2 per employee per month. A recent study by Hewitt Associates, a global outsourcing and consulting firm, estimates that these programs can provide a $1 to $4 monthly cost savings per employee within two years. Even so, there's debate over their effectiveness, which can be hard to measure given that claims can be inaccurate or out of date.
Health-care companies aren't helping matters, either. "Health plans do a great job of selling disease management programs, but they do an awful job of implementing them," says Dr. Jay Kulkin, medical director of the Women's Institute for Health PC in Atlanta.
So before you sign on, ask hard questions. Find out how the provider contacts employees, how it protects employee privacy and what incentives it offers. Inquire about percentages of participation in its programs, screenings and surveys. "Make them show you how they have decreased expenditures for other companies," Kulkin says.
Besides predicting the effect on your bottom line, think about incentives you can offer, from decreasing employees' co-pays and offering extra time off to giving gifts and bonuses. Start educating employees about how much health care costs the company--a conversation that still isn't making it out of most boardrooms--and send a message that you value good health by creating a work environment that encourages it.
Rest assured that as much as you'll be looking at these measures, your employees will, too. Says Amish, "When employers offer programs in a no-stress, no-tracking kind of way, it's a win."