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Return On Investment: Building your Case

for Wellness

March 19, 2009

Brian Day, Ed.DHealth Plan Informatics

Health Plan Informatics

Reporting• Account reporting

– Medical facts– Drug facts– Risk management– Integrated account report

• Quality Management– HEDIS– CAHPS

• Govt., Regulatory– PHC4– PA Dept of Insurance

• Care Management– Blues On Call activity– Highmark@Hand– Condition Management Savings

• Reports@Hand– Self-service report generation and scheduling

• Ad hoc reporting

Data Services• Data feeds (IPDR)• Data extracts (CDE, BHI)• Member Reporting Repository• Programs/query migration• Pharmacy carve outs

Analysis• Foundational grouping and

stratification of member populations

• Predictive modeling– Risk– Trends

• Research studies with CDC, County Health Department, RAND, Solucia

Strategic Initiatives• Blue Health Intelligence (BHI)• Health Excellence Partners• Personal Health Records• Specialty physician profiling• Cost and Quality Transparency• Fraud

Business Ventures• InteliMedix

Presenter

Presentation Notes

R@H Rollout Internal Informatics All Highmark CSG’s CCR 2005 Accounts GuideStone All FL Plan Client Managers Gneco Mellon CBIZ (Hershey’s consultant) Kirkpatrick, Lockhart 2006 Accounts Cookson Reschini Team Scotii Additional apps for EDW migration Surveillance Report Submitted claims for case mgt identification Daily submitted claims ident of members w/ high cost claims or w/ diag or proc on case mgt trigger list Remicade rebate project Sales has rep on respective steering committees NRPD R@H H@H

Advanced Analytics

• Pattern recognition and deviation detection• Segmentation and clustering• Time series and forecasting methods• Advanced geo-statistical methods• DxCG, RxGroup Models• Member movement Analyses• Statistical modeling (e.g., linear,logistic

regression, ANOVA, Cox models)• Cohort identification and analysis• Rigorous scientific research studies

Where do our Healthcare Dollars Go?

Rising Healthcare Costs

• Cardiovascular Disease– Over 80 million cases and over 870,000

people who die of heart disease and stroke each year

– Economic burden: $448 billion a year including direct and indirect costs.

National Center for Chronic Disease Prevention and Control [2008]

Rising Costs• Chronic diseases increase labor costs through

many means, including health care costs, but also through productivity losses from missed work, decreased on-the-job effectiveness, and turnover when an employee becomes too ill to return to work.

• Since 2001, the cost to employers of providing health insurance has increased by 78% . Data suggest that, for chronic diseases, the cost of productivity losses exceeds the cost of health care by as much as 4-fold .

Kaiser Family Foundation 2007Loeppke R, et al 2007

Rising Costs

Diabetes• 23.6 million cases and over 200,000

deaths from complications from the disease each year.

• Economic burden: $174 billion a year including $116 billion in medical costs and $58 billion for lost work days and productivity.


Rising Costs

• Cancer

– 553,000 deaths and 1.3 million new cases each year.

– Economic burden: $217 billion a year including $89 billion in medical costs and $130 billion for lost work days and productivity.


Rising Costs• Smoking and Substance Abuse

– Substance abuse costs the US more than $346 billion per year

– Illicit drug use alone costs $116 billion

– Alcohol-related problems cost the U.S. approximately $185 billion each year.

– Smoking: Approximately 438,000 deaths each year. Economic burden: Over $96 billion in medical costs and $97 billion in indirect costs.

National Center for Chronic Disease Prevention and Control [2008] National Institute of Alcohol Abuse and Alcoholism The George Washington University Medical Center

Rising Costs• The total cost of obesity in the U.S. is estimated

at $92.6 billion annually

– Medical expenditures for obese workers, depending on severity of obesity and sex, are between 29%– 117% greater than expenditures for workers with normal weight.

– Obesity is believed to be associated with more chronic disorders and worse physical health-related quality of life than is smoking or problem drinking

– Estimates of the number of years of life lost as a result of obesity range as high as 20 years of life lost for certain age and racial/ethnic groups.

CDC (2004, 2009)

Highmark’s Investment

Reinvigorating Highmark’s Employee Wellness Program

•

In 2002, Highmark’s internal wellness initiative was reinvigorated.

–

Incentive of $50

–

Strong endorsement of senior leadership

–

Participants rose from 547 to 2,888

–

Significant impact on HRA-based risk as measured by annual aggregate reports

Fitness Center, October,2003

PittsburghFitness Center, October,2004

Camp Hill

Presenter

Presentation Notes

In 2002, Highmark’s internal wellness initiative was reinvigorated with significant interest and support on the part of senior leadership. With the return of an incentive for participation in the amount of $50 coupled with the endorsement of senior leadership, the number of participants rose from 547 to 2888 with significant impact on HRA-based risk as measured by annual aggregate reports. Onsite fitness/wellness centers available to Highmark employees only were opened on the Pittsburgh campus in 2003 and at Camp Hill in 2004.

Preventive Health Services (PHS) Offerings

•

Worksite Programs

–

Personal Nutrition CoachingSM

–

Eat Well for Life ISM

& IISM

–

Discover Relaxation Within ISM

& IISM

–

HOPESM

–

Diabetes Awareness & PreventionSM

–

Clear the AirSM

–

Weight Watchers at Work

–

Physical Activity

Presenter

Presentation Notes

In 2002, Highmark’s internal wellness initiative was reinvigorated with significant interest and support on the part of senior leadership. With the return of an incentive for participation in the amount of $50 coupled with the endorsement of senior leadership, the number of participants rose from 547 to 2888 with significant impact on HRA-based risk as measured by annual aggregate reports. Onsite fitness/wellness centers available to Highmark employees only were opened on the Pittsburgh campus in 2003 and at Camp Hill in 2004.

Preventive Health Services Campaigns

•

10,000 Steps ChallengeSM

•

Bands on the RunSM

•

Drop 10 in 10SM

•

Color Your PlateSM

•

Maintain Don’t GainSM

Highmark Employee Participation

40%

50%

62%

80%

90%

2002 2003 2004 2005 2006

Employee Wellness Participation by Year

Presenter

Presentation Notes

We are currently in the process of completing an in-depth analysis of the impact of the program from 2002 – 2005 and will hopefully have the opportunity to publish it in the next year. The percentage of Highmark employees participating in any wellness program has increased from 40% in 2002 to 80% in 2005. Program participation was highest in the last year, and the most sought after programs included in order: Fitness Centers, on-line HealthMedia programs, 10K Challenge – physical activity campaign, group-based behavior change programs such as nutrition and diabetes, and telephonic tobacco cessation coaching. Also of interest, as the number of activities increased, the number of employees who coupled taking an HRA with another program increased from 52% to 73% with the most dramatic increase in the use of the fitness center following completion of an HRA. (N=1895) An additional analysis was done in January of 2005 on a sample of 2696 employees who took the HRA in 2003 and again in 2004 that demonstrated a significant shift in HRA-based risk factors among Highmark employees. Statistically significant increases in the number of employees at low risk for eight risk factors were demonstrated. Improvements in fitness status were particularly strong. 217 people who were initially high risk moved into the low risk category on fitness. Research has shown that it is a wise investment when you can combine low risk maintenance and high risk management in your program strategy. When you do that, one would expect this to be strong enough to impact health care costs positively Here are some metrics that the Highmark employee wellness program produced. The percentage of Highmark employees who participated in wellness programs, increased from 40% in 2002 to 80% in 2005, and 90% in 2006. There were certainly barriers to overcome in reaching this level of participation. We’ve had our share of skeptics along the way – but ultimately, the culture has changed with us.

The Impact of Highmark Employee Wellness Programs on

4-year Healthcare Costs

Journal of Occupational and Environmental Medicine, Feb 2008

Objective of the studyDetermine the Return on Investment

(ROI) of Highmark’s Wellness programs using a rigorous scientific

methodology

Methodology

• 1,892 employees included (18%)• Risk-matched participants using age,

gender, 2001 claims, and Charlson score to a similar cohort

• Growth curve analysis• Examine claims trends for 2001-2005

Costs of Wellness

Wellness Program Costs, Highmark Inc., inflation-adjusted to 2005 dollars

Naydeck, et. al, JOEM 2008

# Used Total # Used Total # Used Total # Used Total GD TotalHRA & Incentive 1892 $243,731 1303 $143,111 1308 $140,785 1355 $142,605Online 201 $1,142 247 $1,372 248 $1,300 512 $2,575Group 34 $1,544 56 $3,077 56 $3,010 0 $0Nutrition Coaching 2 $66 23 $740 51 $1,585 111 $3,42010,000 Steps 244 $2,441 413 $3,851 223 $2,061Fitness Center 407 $25,603 495 $29,939 879 $50,958Highmark Challenge 112 $348 910 $2,766Maintain Don't Gain Newsletter 85 $182 93 $192Wellness Program Costs $246,483 $176,343 $181,000 $204,577Cost per participant $130.28 $135.34 $138.38 $150.98

Net Savings (Estimated Savings - Wellness Program Costs)$87,398 $157,538 $152,881 $129,304 $527,121

$1,335,524$808,403

$1.65Return on Investment

$333,881$1,335,524

Total Savings Estimated 4 YearsTotal Costs 4 Years

$333,881 $333,881Estimated Annual Savings from Model $176.47/person

$333,881

$808,403

2002 2003 2004 2005

RESULTS

0

5

10

15

20

25

30

35

40

45

50

% p

artic

ipat

ing

FitnessCenter

HighmarkChallenge

HealthMedia

10,000 StepCampaign

NutritionCounseling

GroupProgram

2002

2003

2004

2005

Program participation

500

1000

1500

2000

2500

3000

3500

4000

2001 2002 2003 2004 2005

Net

Pay

men

ts, i

n 20

05 d

olla

rs

Participants Non-Participants

Annual Growth in Total Payments

Growth in Healthcare Costs Comparison

DxCG Risk Category Changes 2001-2005

Program Risk Decrease

HRA & Fitness Center 14.4%

HRA & Media, Group, or Individual Programs

12.6%

HRA Only 11.2%

Controls 11.1%

0.9

1

1.1

1.2

1.3

1.4

1.5

1.6

2001-2005

DxCG

pre

dict

ive

risk

scor

e

HRA Only HRA & Other HRA & FC Controls

DxCG Risk for Wellness Groups

Preventive Screening Rates

0

10

20

30

40

50

60

70

Controls HRA only HRA/other HRA/Fitness

Scre

enin

g R

ate

2001 2002 2005

ROI Calculation

• Savings 4 Years after Baseline (2001) $1,335,524

• Total Costs 4 Years (2002-2005) $808,403

• ROI = 1.65:1

Significant Findings

• Overall savings of $176 PPPY• Inpatient savings greatest, $182 PPPY• Preventive screening rates increased for

participants• Incremental risk decreases• Participants in wellness were not just

healthy employees• ROI of $1.65

Conclusions

• Positive findings for all participation groups• Savings sustained over multiple years• ROI does not include increase in

productivity and decreased absences• Positive and conservative ROI – wellness

works!• HRA is a good start

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