In these harrowing economic times, many companies are looking to cut costs. Layoffs are increasing in frequency and in sheer numbers and, now more than ever, employers need employees to be productive and present. One way employers can address those concerns is by implementing disease management and wellness programs at their companies.
“Disease management and wellness programs have been around for a long time and those programs serve as a way to control indirect health care costs associated with not only direct costs but with lack of productivity and presenteeism,” says Sally Stephens, president of Spectrum Health Systems.
Smart Business spoke with Stephens about how disease management and wellness programs can help reduce costs and how to set these programs up at your company.
Why is it important for companies to focus on disease management?
‘Chronic disease is a major contributor to costs, and if you worked with people with chronic diseases and changed lifestyles, then you could reduce the risk of complications and hospital stays and reduce costs,’ says Joseph Marlowe, senior vice president at Aon Consulting in Philadelphia.
According to Aon actuarial studies, approximately 10 percent of the population accounts for 70 percent of the costs. Incorporating disease management programs into the plan design can positively impact these costs.
The emphasis of disease management programs is on helping participants manage their diseases rather than treating periodic, acute and expensive episodes. The idea of disease management was conceived in the early 1990s when it was realized that the majority of health care expenses were incurred by a limited number of people. Diabetes alone has reached an epidemic level and threatens to overpower our health care system. The incidence of type II diabetes has increased by 33 percent in the past decade alone. Health care expenditures are as much as five times higher for individuals with diabetes and 75 percent of the cost is for treatment of complications.
What disease management goals should companies have?
Employers see disease management as a way to rein in escalating costs by ensuring that plan participants with chronic conditions are effectively monitoring and managing their illness. The key to gaining the optimal benefit from disease management is to actively engage as many of those with chronic conditions as possible. Incentives and plan design are two strategies that can dramatically impact the number of individuals engaged.
Another important goal is M.D. engagement in the disease management programs. Members, physicians and payors must be fully engaged in the process to achieve optimal outcomes. Providers must work to help physicians see that disease management programs are an extension of their time working with a patient. This helps the physician clearly see that disease management and health and wellness programs can pr ovide a strong benefit when done in partnership.
What steps can companies take to achieve these goals?
Because disease management has gained tremendous traction, many providers now offer these services. Such providers include stand-alone disease management companies, health plan providers, third-party administrators and wellness vendors. In fact, nearly 80 percent of service providers offer one or more disease management programs, with an additional 16 percent providing disease management support technology, software or devices. Programs that focus on diabetes, coronary artery diseases and asthma achieve the greatest number of enrollments, when measured as a percentage of eligible program total plan members.
When selecting a vendor, it is critical to address best practice requirements, including:
n Effective strategies to identify and engage candidates in programs
n Interventions incorporating advanced behavioral support and that follow evidence-based medical guidelines
n Management of population health
What kind of resources should companies commit to disease management?
As the economy worsens, disease management is not an area in which employers should cut back. An interruption in the continuity of care for chronic conditions will increase the risk of a setback in health status and potentially will create higher costs in the future. At the same time, employers will expect disease management programs to produce results.
How can companies be sure their disease management goals are working?
Employers will want the program to be as robust as possible and will take a hard look at the return on investment and focus on the cost trend of health care expenditures. They will want to specifically know how these programs have made a change in the company’s total cost trend. The use of disease management programs is on the rise and there are factors other than cost savings behind this growth. These programs can reduce absenteeism, increase productivity, increase retention and improve a company’s effort to be a place where people want to work.
SALLY STEPHENS is president of Spectrum Health Systems. Reach her at Sally.Stephens@spectrumhs.com.