In an era of evolving workplace demographics and escalating healthcare costs, integrated wellness is the way forward
Holistic health is the new mantra for group benefits plan sponsors and providers hoping to enhance workplace wellness and also keep costs in check. They’re finding that the earlier they invest on the healthcare continuum, the more they can control future costs.
“The further upstream we go, the better opportunity we have to influence areas of plan costs that are open to management,” says Mike Kennedy, vice-president and national leader of health strategies and solutions with Aon Hewitt. “You’ll never drive costs to zero—that’s not even the intent of the benefits plan or workplace health program. But there are certain prevention and early intervention initiatives that can result in fewer claims and lower costs.”
Chris MacDonald, assistant vice-president, wellness, absence and disability solutions, group benefits, with Manulife Financial, cites a 2010 study by the Centre for Addiction and Mental Health noting that every shortterm disability (STD) claim averted as a result of a wellness initiative or workplace support saves about $18,000 (based on average duration for each STD claim related to mental illness of 58 to 60 days). And when you move a health risk from modest or severe down to the normal range, it results in $1,500 in savings in absence costs for each risk. That’s a considerable amount, considering that half of the working Canadian population has three or more health risks in the moderate to severe range, she adds.
However, employers still think of health benefits as tools to be used when employees are coping with illness, says Marilee Mark, vice-president of market development, group benefits, with Sun Life Financial Canada. “But if you’re trying to analyze drivers of cost or lost productivity, you need to consider metrics along different phases on the continuum.”
Emmanuelle Gaudette, manager, health and wellness, with Standard Life, also underscores the importance of integration. “We can put in place various employee assistance programs [EAPs] and STD and LTD plans, but without integration, we miss out on opportunities. For workplace benefits plans to be successful, employers must integrate benefits all along the continuum.”
Yet the market continues to focus on medical plans and prescription drug management separately, says Sarah J. Beech, president of Pal Benefits. “A lot of energy is still focused on managing drugs. The truth is, we’d be better off looking at the individual claiming the drug benefit.” For example, instead of being alarmed at an employee claiming prescription drug benefits for Remicade (roughly $25,000 a year), it would be wiser to also calculate the costs of that person not taking medication and going on disability, in terms of disability claims, absenteeism, lost productivity, replacement and recruitment.
Big-picture Thinking
“If you look at a health plan in isolation from a disability plan—or if you put in so many restrictions on drug plans that people can’t access the medication they need and go on disability as a result of the lack of assistance—you haven’t really balanced a good support program,” Beech says. “Instead of focusing on an isolated element, we need to look more holistically at data and think bigger picture. By spending a little more in one area, we might actually be saving big in other areas.”
For best results, Loretta Kulchycki, vice-president of group marketing with Great-West Life, supports a collaborative approach. “We look not just at drugs but at the interplay between drugs, disability and absenteeism. We also take into account EAP utilization rates, wellness program results, as well as short- and long-term disability and drug claims data, et cetera, to provide integrated reporting and recommendations for change to improve overall health outcomes.” These reports show clients the connection between their benefits spend and targeted health outcomes, and identify trends at any point on the health continuum—whether employees are at work, at risk, off work or returning to work.
MacDonald adds that she’s worked with several large companies in which different areas handle different benefits programs, with no clear accountability or ownership. “We try to bring these diverse departments together to build common wellness objectives and identify appropriate owners for each initiative.”
Early Detection
When it comes to mental health, Mark particularly sees wide gaps in the early detection stage and says that a very effective—yet seldom used—tool is manager training. “Managers can and must be trained on how to pick up on cues and initiate a conversation that’s respectful of employee privacy but, at the same time, encourages them to access resources they may require, including those available at the workplace.”
For example, managers may shy away from making observations about changes in performance, appearance or behaviour. “You never want to assume what’s behind the change but rather open the door to a conversation that expresses concern, addresses any workplace factors and directs the employee to services available,” says Mark. “A good conversation opener could be, ‘I’ve noticed lately…’ and then leave it up to the employee to determine where they want to go with the conversation.”
When considering wellness programs, a good place to start, Mark suggests, is to take data from different benefits and blend it together for an overview of the overall state of health and needs of that workplace. Gaudette cites mental health as an example. “If a health benefit diagnostic analysis shows high incidence of mental [illness], and we find the frequency of visits to psychologists or EAP usage low…there’s an obvious gap. In such situations, we try to understand the client’s situation and analyze the underlying reasons. If we find stigma is an issue, we recommend setting up anti-stigma campaigns. We also try to generate more awareness around EAPs and available health benefits that target and address mental health. We further analyze if mental health claims are related to organizational aspects or personal ones. If it is an organizational issue, we review the program in an attempt to address those issues.”
Absenteeism is another focal point. “A significant gap we find in the market is around intervention in casual absence programs,” Gaudette says. “But when we calculate absenteeism costs, they may be as high as STD.”
In most organizations, Gaudette says the No. 1 claim is around mental health. “If we don’t detect at-risk employees early and manage occasional absences, there’s no stopping them from becoming STD or LTD.”
However, according to Statistics Canada’s 2012 figures, a mere 0.14% of Canada’s 1.1 million employers have 500 or more employees. Small to mid-size organizations may not have the money, scale and resources to spend on detailed research and analytics. “The full-blown sophisticated approach to wellness has little appetite or application given the realities of the Canadian market,” adds Martin Chung, assistant vice-president, strategic health management, with Equitable Life of Canada.
One way to keep things simple for small and mid-size companies, he suggests, is to give them insights specific to their universe, not high-level benchmarks. “The average employers don’t know the names of the 25,000-odd drugs in the market for various conditions, but they understand heart disease, diabetes, depression, et cetera. Strip away the fancy talk, give them the top diseases that afflict their employees, and they’ll be in a much better position to make changes.”
Customized Communications
Whether the employer is large or small, an effective communications strategy is key to getting employee buy-in. “You might spend thousands on a wellness and benefits plan, but if your employees don’t trust you or they feel there’s a hidden agenda, they won’t adopt it,” Chung says. “Benefit strategies focus very much on understanding cost drivers, but we often forget to balance it with a humanistic aspect.” An effective communication strategy needs to be approached differently. “As opposed to saying, ‘Here’s what we think is important for you,’ how about saying, ‘We got feedback from you and your colleagues, and 80% of you said weight management is among your top three priorities. Based on your input, we are introducing a weight management program,’” Chung suggests. “It’s not enough to find out who is overweight; it is equally important to find out if those people care to make a change in lifestyle.”
Another gap—or opportunity—is tailoring messages around individual needs. When a new employee comes on board, or at the time of claim or disability, these are great chances to introduce or remind the employee about the various resources and services available. “Communication works best when you clearly address What’s in it for me?” Beech says. “When you present employees with a pedantic theory of how the plan works, they tend to glaze over. It’s much more effective when you make it experiential.”
And not enough companies use total reward statements effectively, she adds. “These statements really articulate all of the perks that an employee enjoys, in addition to their salary. Helping employees see offerings, or the benefits of offerings, as a total picture ensures that they have a grasp on both what’s available to them and the value in what’s provided.”
The bottom line: healthcare is not just an employee benefits discussion anymore. “It’s no longer an HR tool just for employee retention and engagement,” Kennedy explains. “A holistic approach has a much greater role from a business perspective—helping plan sponsors balance investment between avoiding the future impacts of sub-optimal health through prevention, and paying the current costs of ill health through premiums and claims. Employers are beginning to recognize that to unlock the full potential of a holistic approach, they need to move beyond supporting healthy people to supporting healthy workplaces.”
It’s a work in progress, but providers and employers are stepping out of silos to view workplace well-being as an amalgam of physical, psychological, emotional and social fitness. And that’s a big picture that employers and employees alike will want to see.
Kanupriya Vashisht is a freelance writer based in Toronto.
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