Wellness works: Programs improve business outcomes, leaders say

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131581367If several businesses worked together and collectively brainstormed to improve health care, would it work? Would it result in a more productive workforce and lower costs?

A group of health care consumers and providers from Colorado Springs met recently to discuss those issues, along with a representative of the governor’s office and the consulting corporate medical director for Wal-Mart.

In Colorado, health and wellness actually drive the economy, said Katherine Blair, a senior policy advisor for health to Gov. John Hickenlooper.

“It’s not just about the health care industry. It’s about keeping people healthy to create a healthy workforce,” Blair said.

One result of the workshop was to introduce human resources professionals around the region to the idea of collective impact. Those who attended expressed an interest in continuing the discussion, so “we have some follow-up work planned,” said Tamara Kirk, human resources supervisor with Colorado Springs Utilities.

“The steering committee would be interested in reaching back out to the groups and possibly convene a group of people interested in the engagement, particularly the people who design health care plans,” Kirk added.

Economics of health care

Blair broke down the economics of health care, in 2012 dollars.

The health care delivery system is a $29 billion business in the state, Blair said. Wellness programs, including health clubs, vitamin stores, recreation centers, are a $4 billion business.

Supplying health care items and services is an $8 billion business, and the presence of federally funded initiatives such as Medicare and Medicaid contributes $4 billion to the state’s economy annually, she added.

The number of jobs in the category of health care wellness programs is expected to grow between 20 percent and 70 percent in the coming years, Blair said. Home care and personal care businesses expect an average growth of 70 percent, she added. The average wage of a home-care professional is $9.40 an hour.

“We need these services,” she said, “but the wages are low.”

The average working wage in Colorado is $51,848, she said. In the health care industry, the average wage reaches $105,637 a year.

Nationally, 40 percent of small businesses have wellness programs. Small businesses are defined as having 200 or fewer employees. Those companies’ initiatives tend to be passive, such as pedometer walking programs.

For larger businesses, those with more than 200 employees, some 80 percent have wellness programs, and those programs tend to be more active, and therefore better, for the employee, such as lower-priced health club memberships, Blair said.

Also, the fact that Colorado is identified as having a healthy population helps economic development professionals recruit business to the state, Blair said.

Utilities’ health program

Bill Cherrier, chief planning and finance officer for Colorado Springs Utilities, said health care is “a key sector of our economy, one of the largest sectors in the economy.”

Because of the aging population as Baby Boomers grow older, business will have to manage health care differently, said Cherrier, an avid bicyclist who advocated health and wellness programs for businesses.

When businesses shift costs of health care premiums to employees, “it can really affect how they use health care,” Cherrier said. “We don’t want employees to under-use wellness programs.

“If we work together, we can really have a significant impact” on the health of the employees and their family members, in addition to reducing costs, he added.

“Think about health as a strategic business development, not just a cost center.”

– Dr. Bruce Sherman, Wal-Mart

Of CSU’s $1.1 billion annual budget, $190 million is attributed to employee costs, Cherrier said. Health insurance, medical and dental programs amount to $18 million annually.

“Managing health care costs will be very critical” in the near future, he said. “We’ve been very passive about our health care management, and we should be more active.”

Wellness programs are better if they’re active, he added, citing the Fitbit wrist-worn wellness tool that tracks and documents calories burned, miles walked, weight, and sleep attained.

“We should be telling our health care providers what we really need,” he said.

“We’re concerned about reducing our health care costs, but if we can improve productivity, that can be a more significant gain than what’s lost in health care costs,” Cherrier said. “If I’m more active, I tend to be more productive at the office.”

The employees who tend to be more active tend to have lower health care costs, he added.

Wal-Mart’s champion

Dr. Bruce Sherman is the consulting corporate medical director for Wal-Mart Stores Inc. Previously, he held the same post at Whirlpool Corp. and Goodyear Tire and Rubber Co.

“Any time a community or region approaches innovation in health care collectively, the potential for change is powerful and practical,” Sherman said.

Sherman championed wellness programs and cited an article he wrote in the February edition of the American Journal of Managed Care. He and co-author Wendy Lynch compared medical costs to stock value and found that when health care investments increased by $1,000 per employee, stock values increased far more.

The Sherman-Lynch article cited a Towers Watson report that showed organizations investing in workforce health saw increased business success.

“Think about health as a strategic business development, not just a cost center,” Sherman said at the meeting.

“We need to give employees access to tools to help promote health and wellness,” Sherman said. He cited smoking cessation programs and employees’ use of the Fitbit.

Well-being programs also convey to employees that they are valued, and that is critical to workforce retention, he added. Some employers look at health care costs as the highest cost center, Sherman said, adding that preventive medicine is free.

“Well-being is a rapidly emerging construct that employers want to use to lower health care costs and improve retention,” Sherman said. Wellness programs “bring value to business and to the community as a whole.”