March 12, 2009
Cardiovascular Disease and Diabetes are the Most Frequently Targeted Conditions Among Employers
LINCOLNSHIRE, Ill. — The number of companies taking action to combat the chronic health conditions of employees and their families jumped almost 30 percentage points over the past year, as organizations attempt to balance rapidly rising U.S. health care costs with a growing population of unhealthy Americans, according to a recently released survey by Hewitt Associates, a global human resources consulting and outsourcing company.
The number of Americans with chronic illnesses — and the health costs associated with treating these conditions — continues to grow at alarming rates. According to a recently published report by the Milken Institute, the total cost spent on managing chronic health diseases in the U.S. is estimated to be $1.3 trillion annually, with $1.1 trillion spent in lost productivity and another $277 billion on treatment. For diabetes alone, Hewitt estimates that a typical employer with 9,500 employees and 500 pre-65 retirees spends $18 to $22 million on direct medical care for its diabetic population.
To mitigate these costs and improve the declining health of their workforces, Hewitt's survey of 343 large U.S. employers found that almost two-thirds (65 percent) continue to make significant investments in improving the health and productivity of their workforce. Their efforts go beyond general condition management programs to pinpoint and subsequently reduce the most prevalent chronic illnesses within their employee populations. Approximately 80 percent of companies are targeting specific health conditions in their employee population today, up from 51 percent just a year ago. The number of employers targeting diabetes and cardiovascular disease — two of the costliest and most prevalent chronic conditions in America — increased by almost 30 percentage points, to 75 percent and 70 percent respectively. Additionally, 56 percent of companies are targeting asthma, up from 36 percent in 2008, and almost a third (32 percent) are targeting depression, up from just 17 percent in 2008.
2009 Health Conditions Targeted by Employers Compared to 2008
| Target Condition |
2009: Percent of Companies Targeting Condition |
2008: Percent of Companies Targeting Condition |
| Diabetes |
75% |
46% |
| Cardiovascular disease |
69% |
40% |
| Asthma |
56% |
36% |
| Depression |
32% |
17% |
| Other |
29% |
14% |
"The U.S. health care system spends enormous sums of money caring for those with chronic conditions, leaving both individuals and employers to bear much of the costs," said Kathy Harte, RN, MS, CMM and co-leader of Hewitt's Health & Clinical Consulting practice. "There is a significant opportunity for companies, particularly in today's economic environment, to control these expenses and improve the overall health of their workforce by helping chronically ill employees and their dependents optimize treatments for their conditions."
Designing Effective Condition Management Programs
While an increasing number of employers are targeting specific conditions among their member population, Hewitt research shows only a small percentage of workers who are eligible to participate in condition management programs actually do so. Even fewer are actually satisfied with the programs' results.
"The long-term success of these initiatives depends heavily on members changing behavior to manage their conditions," said Jennifer Boehm, a principal in Hewitt's Health Management Consulting practice. "Many of the root causes of chronic conditions, particularly diabetes, are lifestyle-related, which means they are avoidable. Employers with well-designed condition management programs that encourage healthy people to stay healthy and help at-risk individuals reduce their chances of becoming chronically ill will ultimately see the best returns. Even moderate changes in participant behavior can result in significant annual cost savings and a healthier workforce over time."
Hewitt recommends employers take four key steps to ensure their condition management programs achieve optimal results.
- Analyze members' claims. Employers should perform a detailed review of members' health care claims to determine the prevalence of chronic conditions within their population and ensure they are not missing undiagnosed individuals or individuals who are at risk. According to multiple medical research reports, an estimated 30 percent of an employer population has an undiagnosed chronic condition and another 25 percent may be considered "at risk" for developing one.
- Improve techniques used to engage targeted enrollees. Traditional techniques, such as nurse outreach calls, have shown to be effective in engaging only a small percentage of the overall population. But there are small steps employers can take to significantly improve member engagement in condition management programs. Surprisingly, not being able to reach members is one of the leading barriers to engagement. In some cases, condition management vendors are provided with phone lists that are inaccurate or that do not contain telephone numbers of the members they are trying to reach. Measuring program performance is also critical. Companies should work with their vendors to set up aggressive performance guarantees around participant engagement and hold them accountable for meeting those goals.
- Implement more compliance incentives. Preventing and/or managing chronic conditions require workers to change behaviors. In many cases, employers have incentives in place, but they either do not encourage behavior change or incent the wrong behaviors. Hewitt recommends employers consider a value-based design approach, which can reduce or remove financial barriers to care and improve compliance by offering certain condition-specific medications at reduced or waived co-pays. Employers should also consider implementing programs through which members can earn wellness points for participating. These points can be exchanged for additional dollars put into Health Savings Accounts (HSAs) or Flexible Spending Accounts (FSAs) or toward decreasing employees' health care premiums.
- Communicate and market effectively. An effective communication strategy is a critical element of any condition management program. Employers need to ensure they are delivering appropriate messages to the right audiences, and with specific frequency. They should also launch condition management programs with the same level of effort as they would a new product or service. Developing a clear and structured marketing strategy for each chronic condition management program creates "buzz" among participants, highlights the benefits of these programs, and encourages participation and compliance. Equally important for employers is addressing any employee concerns about confidentiality. Many workers are likely to question the company's intentions and how they plan to use their personal health information, so employers need to be open and honest about their intentions behind these programs.
About Hewitt Associates
Hewitt Associates (NYSE: HEW) provides leading organizations around the world with expert human resources consulting and outsourcing solutions to help them anticipate and solve their most complex benefits, talent, and related financial challenges. Hewitt consults with companies to design and implement a wide range of human resources, retirement, investment management, health management, compensation, and talent management strategies. As a leading outsourcing provider, Hewitt administers health care, retirement, payroll, and other HR programs to millions of employees, their families, and retirees. With a history of exceptional client service since 1940, Hewitt has offices in 33 countries and employs approximately 23,000 associates who are helping make the world a better place to work. For more information, please visit www.hewitt.com.
