The other day a good friend and I were discussing a bad customer experience that he had recently had at a well known restaurant. In a word, the customer service and resulting experience were awful. Actually, the customer experience was beyond awful it was dreadful. It is surprising given the weight that restaurants place on customer service and word of mouth value. This got me to thinking about the customer service in healthcare. Is there anything more maddening than arriving at a physician’s office on time and then having to wait for an hour or in some cases more because the physician is running late? There are typically no apologies or considerations that you, the consumer, may have other commitments. Actually, there is something more maddening… arriving 5 minutes late to the same physician at the next appointment only to be told “you are late and need to reschedule because the Doctor can no longer see you.” Now how is that for customer service?

I think about this quite a bit right now because the word “consumerism” is rapidly making its way into the vocabulary of the healthcare market. With customer satisfaction scores and Zagat ratings of physician satisfaction, it becomes apparent that the majority of healthcare providers haven’t quite figured out what a consumer of healthcare services may actually look like or expect. If patients are becoming consumers, then healthcare providers need to understand that with that will come a certain set of typical consumer traits, such as the demand for value, better customer service, willingness to switch, and word of mouth impact.

I often spend my days in deep discussion with clients regarding the disease states that they believe are the catalyst to their medical and claims costs. The focus of their health and wellness programs are typically centered on containing the costs associated with conditions that drive the highest costs . It makes sense given that the top five conditions are usually chronic in nature (cancer, coronary heart disease, chronic pain, neck/back pain and high cholesterol).

A recent study by the Journal of Occupational and Environmental Medicine regarding the cost impact of presenteeism leads me to ponder whether employers should be focusing on less tangible measurements than medical and pharmaceutical claims costs. Based on this study, presenteeism appears have significantly more impact on healthcare costs than previously thought. Even more interesting is the fact that conditions that drive claims costs often are not the same conditions that lead to presenteeism and affect productivity losses. Some interesting findings in the study included:

- The five costliest conditions that drive employer costs, when productivity losses are factored into the equation, as a result of presenteeism are: depression, obesity, arthritis, back/neck pain, and anxiety.
- For every dollar spent on medical costs and pharmaceuticals, there is $2.30 of health-related productivity losses due to absenteeism and presenteeism.
- For certain conditions, such as anxiety, employers can lose $20 in productivity for every dollar they spend on medical costs and pharmaceuticals.

In the wake of the continuing workforce reductions, corporations are running extremely lean, requiring more productivity from employees. Uncertainty, stressful environments, less resources, and an increased focus on productivity may be perpetuating presenteeism conditions that aren’t being addressed in a health & productivity program because these conditions aren’t driving claims, conditions such as anxiety

When assessing the goals and objectives of a health & wellness program, these study outcomes should trigger discussion regarding where to place emphasis – on tangible costs or on more significant productivity costs? What are your thoughts?

I am all for finding methods for bending the healthcare cost curve down. I understand the unsustainable position that our nation faces if we don’t succeed in containing costs. The use of generic drugs is an area that has proven to show great savings as evidenced by a recent study released by The Generic Pharmaceutical Association.

There is no doubt in my mind that generic drug usage will continue to increase and that payers will continue to offer incentives to convert consumers to the use of generic drugs. So we know that generic drugs can create significant cost savings but I can’t help but wonder if the use of generic drugs is stifling innovation of new drugs?

President Obama’s position for health reform has been closely aligned to the nation’s economic health. His argument: healthcare costs consume about 18% of our GDP and until we get health care costs under control our nation’s economic health is greatly impacted.

A recent study by The Robert Wood Johnson Foundation extends the argument beyond health reform and has examined the impact that job loss has on health conditions. The key findings in the study include:

- The likelihood of individuals who lost a job through workplace closure reporting fair or poor health increased by 54%.
- The odds of developing a new health condition rose by 83% among those who had no preexisting health problems.
- Even when individuals found new jobs, they continued to have an increased risk of new stress-related health problems.

David Williams, staff director of the Robert Wood Johnson Foundation added this thought. “Where and how we live, work, learn and play have a greater impact on how healthy we are than the healthcare we receive.” I am not sure that I agree with Mr. Williams completely but I think there is definitely merit to his point. Beyond looking at health reform as the delivery system and a cost containment effort, we also must examine how other environmental factors contribute to our health and therefore, contribute to costs.

I don’t know about you but I continue to be amazed at the on-going dialog that is taking shape between the government and key influencers within the healthcare market. On Monday, President Obama met with health care providers to continue ongoing discussions regarding cost containment and universal coverage.

Do I think that hospitals, health insurers and pharma companies are acting in such a conciliatory manner in order to have more say in the health reform bill that will be introduced later this summer? Sure I do. However, optimist that I am, I also believe that there is a recognition from all parties that the system is failing the people and that at its current trajectory the system becomes unsustainable. Everyone, health insurers, physicians, hospitals, pharmacies, pharma companies and individuals will have to accept trade-offs if health reform is going to be successful. While I continue to think that this administration has taken the health reform discussion further than any previous administrations, the proof will be vetted out in action. What are your thoughts on Monday’s discussion?

To date much of the discussion around health reform has been focused on cost containment, IT and the delivery system but little has been mentioned about a key pillar in President Obama’s health reform initiative, the pillar of wellness and prevention. Today, wellness and prevention took front and center stage in the dialog that President Obama continues to have with the public, employers and other stakeholders regarding the national imperative for health reform.

What does President Obama’s announcement mean for preventive health? Like much of the initial dialog around health reform, I think that this is the beginning of reframing the discussion around individual accountability and the health system’s responsibility to lead the effort in educating and motivating critical behavior change. If the goal of the health reform effort is ultimately to bend the cost curve, through efficiency and inclusion of all into a system the root cause of cost escalation needs to be addressed. While I may be oversimplifying this, evidence continues to mount that individual health habits and behaviors are associated with a significant portion of preventable healthcare conditions and now is the time to address a root cause of healthcare costs - change health behaviors.

What I found interesting today is that employers who have successfully managed to contain their healthcare costs such as Pitney Bowes, Safeway and J&J have done so through effectively building an integrated wellness culture. In addition to experimenting with various benefit coverage and designs, these organizations actively talk, treat and reward their employess for personal health accountability. The organizations that President Obama mentioned today have some other fundamental elements that are critical to their success in developing a wellness culture. Their program elements are integrated, tied to a performance culture and include the recognition that incentives, rewards and continuous awareness and dialog with their employees enables the emotional connectivity that ultimately leads to individual engagement. These companies have proven that it is possible to lower costs through a focused effort on health and wellness. These companies have proven that an integrated health and wellness solution that truly engages individuals ultimately leads to increased productivity and a return on investment. Isn’t it time that we all begin to take a page from their playbook?

In a recently published study by the Lewin Group , pre-diagnosed Diabetes costs are costing the US $18B a year in addition to the $174B in annual expenses and lost productivity.

It is not uncommon for an individual with Diabetes to have co-morbidities such as Heart disease and Obesity that also result in high annual medical claims and lost productivity. What is interesting to me is that some health and wellness programs are focusing soley on Obesity as the underlying driver of Diabetes and Heart Disease and therefore, focusing their prevention efforts soley around weight management. Employers and health plans are making substantial investments in engaging the consumer in the battling the bulge. Weight management rewards programs have evolved from using incentives for participation to a more outcomes-based approach, rewarding participants for losing weight and rewarding them more for keeping it off.

Weight management programs have proven to be effective, delivering a return on investment of approximately 5-1. What strikes me as interesting is that while weight management rewards programs have proven to be effective, many health and wellness programs are still not emphasizing these programs for their population and I am not sure why.

Aetna announced the results of a six year study of healthcare claims and utilization for members of its CDHP. Some of the key findings included:

- sustained savings over a five year period, employers saved anywhere between $7-$21 million per 10,000 members over the five year period,
- members of the plans sought increased levels of chronic and preventive care,
- higher utilization of generic drugs, and
- higher utilization on-line tools and information.

These seem to be promising results given the struggle that health plans have experienced in reigning in healthcare costs. It will be interesting to see the strategies that Aetna and other health plans may employ to compress the length of time that it may take for employers to benefit from such savings.

In a recent study published by the New England Journal of Medicine smoking was identified as the top cause of preventable death in the U.S., responsible for killing about 438,000 people each year. Even more astounding was the fact that General Electric spends $50 million annually on healthcare costs for smokers which didn’t include associated costs due to lost productivity.

Interestingly enough, GE ran a study to better understand how incentives influenced smoking cessation programs. The results further validate that incentives, when implemented strategically throughout the progression of behavior change have a significant effect on better health behaviors. Several points highlighted in the study include:

• The trial was designed to see how many of the 836 participants remained non-smokers over a 12 month period.
• Half of the participants were given: $100 for completing the smoking-cessation program, $250 for not smoking within six months after enrolling in the study and $400 for abstinence after six months more, confirmed by saliva or urine tests.
• After an additional six months, 9.4 percent of the paid group still wasn’t smoking though they were no longer receiving cash rewards.

Clearly the investment of $750 per participant to motivate smoking cessation is significantly less than the cost per employee that GE pays for smoking related health issues. And clearly, GE also understood that nicotine addiction is an extremely difficult behavior to break even when an individual wants to change. I believe that GA has seen success in their smoking cessation efforts for two reasons: 1) the use and value of incentives was meaningful enough to motivate participation and meaningful enough to sustain a changed behavior, and 2) GE’s commitment to this program over a longer period of time.

A study published in Postgraduate Medicine found that automated self-testing health stations in the workplace helped employees improve their management of hypertension and obesity.

Highlights from the study include:
• Over 21% of the employees voluntarily used worksite health stations to measure their blood pressure or weight.
• Worksite health stations identified 27% as hypertensive, 40% as pre-hypertensive, 38% as obese, and 35% as overweight.
• Approximately half of the employees with hypertension and 10% of the employees with obesity successfully reduced their health risks.

I found this study interesting due to the continuing lack of awareness that most individuals have around their health risks. In addition, the convenience that health stations afford employees mitigates the “I don’t have time to leave work and go to the Doctor” excuse that often times delays health risk or condition identification