HEALTH, WORKPLACE, AND ENVIRONMENT: CULTIVATING CONNECTIONS

October 17, 2013

Measuring Effective Investment in Worksite Preventive and Health Promotion Programs

Health,  Workplace,  and  Environment:  Cul8va8ng  Connec8ons  Conference  

Thursday  October  17,  2013 University  of  Connec<cut  Students  Ballroom

Storrs,  CT Martin Cherniack, MD, MPH DOEM, UConn Health Center Co-Director CPH-NEW

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www.uml.edu/centers/CPH-NEW

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The impact of a healthier, more productive workforce is quantifiable; when combined with other business measures it helps determine the overall economic value of an enterprise. The business community, ranging from financial analysts to investors, should develop and institutionalize additional accounting and valuation methods that include health and productivity metrics to more accurately determine the business value of workforce health assets in a company.

•  Raise awareness in the business community of the relationship between the health of the workforce, the productivity of the workforce and the profitability of employers.

•  Educate the business community on the benefits of considering the health and productivity assets of a business when considering the accounting and valuation methods for determining enterprise value. --Benefits Institute consensus statements on productivity 2008

Two World Views Apart: productivity as value added

Dilemma #1: The Productivity Paradox– when benefit and utility differ

Dilemma #2: The problems of accounting for negative value and discounting--when substitutions cannot be summarily valued

Dilemma #3: Monetizing the Multiple Dimensions of WHP – when valuing quality of life and output differ

Dilemma #4: The Anomalies -- when employers do the right thing for the wrong economic reason

The Four Dilemmas of Health and Productivity:

A Linear Pathway for Work and Health Synthesis -- non-integrated

Multilevel Conception of Work Organization concept of integration

Company Level Work Organization: E.g., structure, culture, organizational practices, technology

Division/Department Work Organization: E.g., resources; relation to other departments

Job Level Work Organization: E.g., work pace, supervision, work flow

Physical Exposures

Psychosocial Exposures

Other workplace exposures: •  Chemical, dust, biological, etc. •  Noise, temperature, radiation, etc. •  Safety hazards •  Others

Worker Outcomes:

Positive: •  Good health •  Improved productivity

Negative: •  Disease/injury •  Reduced productivity

Organizational Outcomes:

Positive or Negative: •  Productivity •  Quality • Customer Satisfaction • Health Care Costs • Workers Compensation • Absenteeism • Turnover

6

Dilemma #1: The Productivity Paradox

•  1. Assigning Value, when ↑Productivity=↓Utility •  2. Sunk Benefits, when negative opportunity

cost discourages intervention Result: Investment in workforce health has (-) ROI for hospital workers,

despite lowering chronic disease hospitalization rates by 33% (Gowrisarkanan et al., Health Affairs, 2013)

Dilemma #1: Work Related Injury by NAICS Sector, 2012

incidence per 1000

Dilemma #1: Impact of RN Staffing Levels on Inpatient

Mortality

Study Design Retrospective cross-sectional 2002-2006

Population 197,961 admissions 176,696 shifts

Below target staffing definition

∆= (targeted staffing hours) – (%FTE, extended shift)

High turnover shift definition

(admissions, transfers, discharges) > 1 SD daytime mean

Needleman J, Buerhaus P, Pankratz S, Leibson CL, Stevens SR, Harris M. Nurse Staffing and Inpatient Hospital Mortality. NEJM 364:11, 1037-1045. (March 17, 2011)

Dilemma #1: Impact of RN Staffing Levels on Inpatient Mortality n=197,961

90 shifts post admission Hazard Ratio

(95% CI) P Value

5 days post admission RN Staffing (shift) > 8 hr less than target 1.12 (1.08–1.16) <0.001 Shift with high patient turnover 1.15 (1.07–1.24) 0.001

30 days post admission RN Staffing (shift) > 8 hr less than target 1.04 (1.03–1.06) <0.001

Shift with high patient turnover 1.07 (1.02–1.13) 0.006

©2011 MFMER | slide-10

Variable

Needleman J, Buerhaus P, Pankratz S, Leibson CL, Stevens SR, Harris M. Nurse Staffing and Inpatient Hospital Mortality. NEJM 2011;364:11, 1037-1045.

Dilemma #1: Staffing Impact - Patient to RN Ratio 1998-1999

Study Design Cross-sectional

Population 232,342 patients discharged/ 18 mos 1 patient per nurse increase

•  7% increase in deaths within 30 days •  7% increase in failure-to-rescue •  23% increase in RN burnout* •  15% increase in job dissatisfaction*

*Job Dissatisfaction and Burnout measures were brief survey determinations

Aiken LH, Clarke SP, Sloane DM, Sochalski J, Silber JH. Hospital nurse staffing and patient mortality, nurse burnout, and job dissatisfaction. JAMA, 2002: 288:1987-1993

©2011 MFMER | slide-12

Dilemma #1: Reduction in Health Care Cost Growth Johnson and Johnson Live for Life (Henke et al. 2011)

Dilemma #1: Johnson and Johnson Live for Life Comparative Risks per 100

Dilemma #2: the problems of accounting for negative value and discounting

ROI = benefit/cost ratio, where discounted inflation-adjusted benefits are divided by costs.

ROI = net present value/present value [NPV / PV of costs], where NPV is defined as the difference between the total discounted inflation-adjusted benefits and the costs of the program over its useful life.

Hurdle Rate = the employer’s acceptable rate of return

Dilemma #2: How Health Improvement and Improved Performance Represent negative ROI

Net-Cost Model for Weight Loss in the Nursing Home Sector

Average Subject

Cost Average

weight loss in pounds

ROI (productivity

+absenteeism) ROI

(absenteeism only)

Incentivized Group n=51 $129 7.3 6.5 0.2

Non-Incentivized Group n=48

$97 2.1 6.6 0.6

Lahiri and Faghri 2012

Dilemma #2 cont. The Effects of Changing Basic Assumptions -- Inputs

Assumptions: Duration 5 years Inflation Rate 0% Discount Rate 4% (ann) Thin tailed health uncertainty No Time preference

Benefits ↓Absenteeism 75 bitcoins ↓Hospitalization/WC 75 bitcoins

Costs Programmatics 50 bitcoins Staffing 50 bitcoins

Negative value?? QWL activity 25 bitcoins ↑OPC/coaching 25 bitcoins Workforce participation 25 bitcoins

Dilemma #2 : The Effects of Changing Basic Assumption -- Output

Return on Investment: BCR 0.70 BCR (no discount) 0.83 RA adj. (4%) 1.05 (-) negative value adj. 1.23 RA adj. (-) neg value 1.83 QWL as (+) value 2.14 RA = long-term catastrophic risk avoidance BCR = benefit cost ratio

Dilemma #3: Monetizing the Multiple Dimensions of Productivity

•  Quantified outcomes measures – org level

•  Quantified outcomes measures – Ind level

•  Qualitative assessment ‘presenteeism’

•  Absenteeism •  Lost work time indemnification •  Output or turnover time

•  Morbidity and co-morbidity effects

on productivity •  Current and future healthcare

costs

•  QWL, Job Satisfaction •  Self or observer described output

Dilemma #3: Contributions to ROI in Studies Using Productivity Estimators  

Study Identification  

Productivity Measure  

 Calculation   Result   Net Effect   Effect on ROI  

Meenan et al 2010   Self report   Presenteeism + Absenteeism  

Presenteeism  ↓ Y2 Y1 +   No net effect   No effect  

Lahiri & Faghri 2012   Self-report   Productivity + Absenteeism  

Productivity 80% of avoided cost  

↑↑  

80% of effect based on productivity  

Mills et al 2007  

Observed absenteeism  Self-report Productivity  

Productivity + Absenteeism  

↓0.36 days lost  10.4% productivity  

↑↑    

72% of effect based on productivity  

Golaszewski   et al 1992  

Productivity based on literature  

Sensitivity @ 4% productivity gain (std), 0% and 25%  

ROI 4.0 @ 4%   ROI 1.4 @ 0 %   ROI 14 @ 25%  

↑↑  

65% of ROI based on productivity  

Baiker et al 2010   Productivity based on literature  

Weight loss + 1RF ↓ = 40 hours   $143 per person   ↑↑   41% of ROI based on

productivity  

Burton  et  al.  2005  Produc2vity  based  on  10  min.    self-­‐evalua2on  

1.9%  ↓  per  RF  $950  per  person  produc2vity  lossx  RF-­‐1  

↑↑    

1.6%  natural  retest↑  ~3.0%  ↓  produc2vity  

Dilemma #3: Distinguishing between the value of a working life and a saved life (VSL)

Period Description $ Value Source

Annual Average investment in WHP

$144 Baiker et al. 2010 Health Affairs

Insurance value of new medical procedure

$50,000 NYT 5/20/08

QOL lost on dialysis $129,000 Lee et al. 2009 (Stanford)

Lifetime EPA valuation $6,900,000 Appelbaum, Binyamin (2001)

Prime working Age $7,000,000 Viscusi 2004

Dilemma #3: Issues most effecting employee productivity: employers perspective

Towers Watson Staying@Work Report, 2009

Dilemma #3: Source of Worklife Stress: Employees Perspective

Towers Watson Staying@Work Report, 2011-2012

Odds Ratios for New CHD Events in Civil Service Workers – Whitehall Studies

Low Risk Intermediate Risk ♂ High Risk

Low Risk

Intermediate Risk ♀ High Risk

From Marmot et al., 1997

Dilemma #3: Monetizing work organization and the quality of life

Dilemma #4: The Anomalies, when employers do the right thing for the wrong economic reason

•  Google: defining absenteeism without formal work hours

•  Green Mountain Coffee: when estimating benefits precedes costs

How work-health health protection/health promotion integration can utilize team problem solving

Defining Productivity-based Interventions through Participatory Action

Selec8on  Criteria   Key  performance  indicators  (KPIs)  set  by  the  group  that  can  be  used  to  measure  the  effec<veness  of  ac<vi<es  and  overall  success  of  interven<on  alterna<ves  in  regard  to:  Scope,  Benefits/Effec<veness,  Obstacles/Barriers,  and  Resources/Costs.      

Scope   The  part  of  the  organiza2on  (e.g.,  individuals,  groups,  whole  parts  of  the  organiza2on)  that  the  interven2on  is  intended  to  benefit.  

Benefits/Effec8veness   Benefits  of  any  kind  that  the  interven<on  should  provide;  for  example,  fewer  accidents,  cost  savings,  improved  job  performance,  improved  health,  improved  safety,  improved  sense  of  wellbeing,  lower  job  turnover,  etc.,  etc.      

Obstacles/Barriers   Anything  that  is  likely  to  work  against  the  interven2ons  being  considered;  for  example,  uncertainty  about  con2nued  financial  resources,  long  delays  in  geTng  needed  materials  or  equipment,  difficulty  in  scheduling  mee2ngs,  a  lack  of  top-­‐down  support,  resistance  to  change,  etc.,  etc.      

Resources/Costs   Some  es<mates  by  the  group  of  the  financial  or  other  types  of  resources  available  for  an  interven<on.    Need  to  consider  both  the  short  and  long-­‐term  resources/costs.      

Current Status of Intervention Research

•  What we know

•  What we don’t quite know, but should know

•  What we need to know

•  HC and individual prevention ↓ hospital admissions

•  Positive work climate (WAI) predicts longevity

•  Risk profiles can be reduced over time

•  Association between workforce health and outcomes in healthcare

•  Integrated Assessment Modeling •  General VSL estimators for work life

•  Age-specific VSL estimators for QOL, QWL and workplace prevention

•  Value based heath care cost adjustments