by Harry Greenspun, MD, Director, Deloitte Center for Health Solutions, Deloitte LLP
My 13 year-old son Luca recently took up cycling. Inspired by my wife’s cycling prowess (see the June 30, 2015 Health Care Current), we created our “Tour de Pain” – family rides ranging from 15 to 65 miles amid the spectacular scenery in and around Washington, DC. When I was at work, Luca would ride on his own. With each stage we did together, it became clear that Luca was getting stronger, while I was simply getting older.
Determined to catch up, I considered investing in an indoor spinning bike so I could train before or after work (or even during excruciatingly long conference calls). But, doing my research, I found the prices steeper than some of the hills I struggled to climb. Much to my delight, Deloitte offers its employees a wellness benefit that can defray some of the cost of fitness equipment, making a sophisticated bike quite affordable. A few clicks and a few days later, it arrived at my door.
Deloitte is one of the many employers that offers some type of wellness program or incentive to their employees. By the latest count, 70 percent of employers offer general wellness programs – this can include newsletters, smoking cessation programs, health fairs, on-site fitness centers and more.1
It makes sense: The US is struggling with an epidemic of “lifestyle diseases” derived from unhealthy behaviors. Inactivity, poor nutrition, tobacco use and frequent alcohol consumption are just some of the issues contributing to this epidemic. And, because employers play a significant role in the provision and financing of health insurance – more than half the US population is covered by employer-based insurance – many have begun seeking ways to encourage healthier lifestyles among their employees.2
But, as employers continue to adopt wellness strategies that aim to encourage health, lower absenteeism and presenteeism and reduce health care expenditures, there are skeptics.
Many privacy advocates believe that giving employers access to sensitive health information puts employee privacy at risk. With the advent of fitness-related wearables, there is also concern that employers could use them to track employee whereabouts.
Some patient advocates are concerned that cost savings will be achieved at the expense of the disabled or unhealthy. The Affordable Care Act (ACA) increased the amount that employers can incentivize their employees for participating in health-contingent wellness programs. Employers can reduce insurance premiums by 30 percent if employees complete health-contingent action items. But in 2014, the Equal Employment Opportunity Commission (EEOC) filed several lawsuits against employers, challenging that requiring employees to submit to biometric testing and health risk screening may force employees to provide health information that is not job-related or required by business necessity. The Commission also challenged organizations that had what it deemed to be excessive penalties or rewards for participation in employer wellness programs. Then earlier this year, the EEOC published a proposed rule to reconcile the Americans with Disabilities Act (ADA) and current tax incentives for employer wellness programs. This proposed rule is intended to supplement earlier regulations issued by the US Departments of Labor, Health and Human Services, and Treasury. It clarifies how employers can promote better health without violating ADA prohibitions against using excessive penalties or rewards that essentially make the programs mandatory.
Finally, even some of the “believers” are skeptical that employee wellness programs will limit or reduce health care costs. Results from Deloitte’s 2013 Survey of US Employers found that while 36 percent of employers use health improvement tactics as part of their strategy, only 25 percent believe this will have a high impact on managing or reducing health care costs. Another survey found that fewer than half of employees (46 percent) have had clinical screenings or completed health risk assessments (HRA), which are used to identify employees for lifestyle health interventions.3
However, according to Deloitte’s 2013 Survey of US Health Care Consumers, nearly one in five consumers covered by employer-sponsored insurance participated in a healthy living or wellness program to help them improve their health. Healthier employers can reduce absenteeism and improve productivity.
Ultimately, employers are likely to continue using wellness strategies – not only to encourage healthy habits among their employees, but also to bolster recruitment. For now, the question is how to proceed amidst the conflicting viewpoints, regulations and study findings on return on investment. Though subsidizing a gym membership seems straight forward enough, evidence suggests that disease management programs are more effective at limiting costs.4 Today, one of the best strategies for organizations may be to have a multi-faceted approach to their wellness programs so that their employees have several options for engagement.
I am fortunate enough to be healthy, but I also recognize I need to get into better shape. It’s likely I would have purchased the spin bike on my own, but my employer’s program certainly made the decision easier. Time will tell how this and other programs, bolstered by flexibility built into the ACA, will get me and others to make healthier lifestyle choices. For now, I have run out of excuses not to exercise, so when Luca and I are not out biking on the road, I will be sweating in the basement while wondering if our program will also cover the cost of a defibrillator.
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Dr. Greenspun, director with the Deloitte Center for Health Solutions, Deloitte Services LP, serves health care, life sciences and government clients on key innovation and clinical transformation issues. He was named one of the “50 Most Influential Physician Executives in Healthcare” by Modern Healthcare, co-authored the book “Reengineering Healthcare” and has served on advisory boards for the World Economic Forum, WellPoint, HIMSS, and Georgetown University. He previously served as the CMO for Dell.
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3 Mattke, Soeren et al.
4 Caloyeras, John, Liu, Hangsheng, Exum, Ellen, Brderick, Megan, and Mattke, Soeren. Manging Manifest Diseases, But Not Health Risks, Saved PepsiCO Money Over Seven Years. Health Affairs, 33, no. 1 (2014): 124-131. http://content.healthaffairs.org/content/33/1/124.full.html