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Testimonial from a Large Boat Manufacturer
Cancer: Cancer screenings performed in this wellness program has detected cancer in early stages allowing for treatment to be more effective. We have had many situations at our different locations where employees have provided testimony that early detection through the wellness program has saved their life. We are seeing significantly less number of large claims ($75,000+) related to cancer. The cancer claims we do see are coming in at a much lower costs (between $20,000- $50,000). Over all, claims dollars associated with cancer diagnosis have dropped from #1 to #4 in our Plan.
Inpatient Services: For the last four years, our number of hospital admits has continually dropped, as has the length of stay. Not only are we improving our benchmarks here every year, but we are significantly below what our TPA sees is their block of business. To quote them, "Your claims for hospitalization are such an anomaly compared to what we see in our insured block and self funded block. Obviously whatever you are doing in the wellness area is working……….keep it up".
Overall Actual Cost Increases: Our actual costs to the medical plan have been in the single digit (2.5%, 7.3% and 4.5%) for three out of the last four years. This has been our experience while the rest of employers have been experiencing actual cost increases in the double digit (teens), even after making plan design changes (cuts). We have not changed our Plan design to attain these goals. We just made a few minor changes to the Plan design effective 1/1/08. Last time Plan design changes took place for us was 1/1/03, with the exception of RX co-pays that went up minimally in 2005. The one year of the last four in which Plan costs were at 12% actual increase, was when one of our nine locations had an extremely bad year with many large claims. This location did not do well in promotion of the wellness program, and was significantly behind the curve of all other locations on participation. I looked at the large claims that they did have, and only 1 out of 12 members had completed a wellness exam. (Please keep in mind that I am the Privacy Official for the Plan and have access to this type of information for budgeting and plan design review purposes).
National Cost Benchmarks: We benchmark our costs against many of the statistics available every year. I have used both Mercer and Kaiser (Education Trust) benchmarks every year so that I can compare employer costs, employee costs and plan design by PPO plan, area of the country and manufacturing industry standards. For the last five years our costs have been below the benchmarks in all categories reviewed. Again, we have been able to keep employee costs for coverage down because we are controlling our costs. We have not had to make Plan design changes that would shift costs to employees because we can no longer maintain the rich Plan design we offer employees and their dependents. What we are able to offer employees (both attracting and retaining employees) has made us #1 employer in all of our locations. We no longer have any completion for employees when we need to hire, nor do we see as much turn over as we used to in our manufacturing locations.
Impact to Large Claims Costs: All Plans experience some large claims ($75,000+), as we do, even with wellness program in place. I can tell you that large claims no longer drive our costs for the medical plan. We have fewer of them that are "catastrophic" in nature. What has evolved for our Plan is that we now see our challenge for controlling costs to be "chronic conditions". Nice problem to have, right! This year in addition to keeping our employees focused on wellness and continuing to adopt better behavioral life styles, we are going to be implementing some disease management programs to improve the status of our "chronic conditions". Our results from the 2007 wellness program year show that there is still significant improvement being made in our individual members "risk status", as a result of the exams and education offered through the program. This is reflected in our claims data also, as many disease categories or showing a reduction in costs.
I understand that employers really struggle with rational to offer and promote wellness programs. After implementing them, they struggle with evaluating the ROI (return on investment) measurements. I think employers will see methods of ROI improving in the next 2-3 years, as there is more of a demand coming from employers to be able to measure their claims data and evaluate the effectiveness of their programs. However, I would hope that employers would not continue to procrastinate about implementing good, effective wellness programs. It does take a commitment on an employer’s part to offer these programs as the real and significant impact become more visible during the second and third years after implementation. If you ever have a client, or potential client, that would like a reference to speak with about ROI indicators and results of the program, please feel free to use me for a reference. Health Dynamics has been a critical partner for us in our efforts to control costs and maintain a rich benefit program for our employee.
Please contact Health Dynamics if you are interested in discussing this information with this particular client.
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HealthDynamics
377 W. River Woods Pkwy
Glendale, WI 53212
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