Healthcare Reform’s Impact on Wellness and How to Incentivize Employees to Engage in Healthy Behavior Presented by: - Jonathan Edelheit, Editor in Chief of Benefits Live Magazine, incorporating National Healthcare Reform Magazine - Vanessa Cullerton, Senior Manager of Employee Wellness for The Hillshire Brands Company -Stacey Nelson, Manager of Health and Welfare for Sprint and -Edward Shulkin, President of Gift Card Partners, Inc.
About the CHWA • The Corporate Health & Wellness Association (CHWA), is the first national non-profit, 501(c)(6), association focused on health, wellness, prevention, and disease management for employers, employees and their families. Our goal is to promote health and wellness in the workplace and to foster an atmosphere of education and engagement with health and wellness programs in the workplace.
The Patient Protection and Affordable Care Act • Abbreviated as PPACA • Known also as the ACA or simply “federal health care reform.” • Signed into law by President Obama on March 23, 2010. • Most it was upheld by the Supreme Court on June 28th, 2012.
The Basics of PPACA • People can no longer be denied insurance due to a preexisting condition. • Anyone not covered by an employer, Medicare or Medicaid is required to purchase insurance from a private insurer or through the exchanges which will be set up; or is required to pay a fine. • This is the controversial "individual mandate"
The Basics of PPACA • The Insurance Exchanges will be done state by state where individuals and small businesses can shop around for insurance, buy it, and receive a government subsidy if eligible.
Effect on Insurance Premiums • It is a common misunderstanding that insurance premiums will go down as a result of the law, but this is not true. • The fee for not having insurance in 2014 will be $95 for the year, or $7.92 a month. This will increase to $695 or 2.5 percent of income whichever is greater. This makes it cheaper than purchasing the insurance.
Effect on Insurance Premiums • Thus people will wait until insurance is needed to buy, and because pre-existing conditions can not be turned down they will get it. They will also be able to purchase this at the same rate healthy people are purchasing it. • The premiums of the people who are paying for insurance will have to give a larger stake in the premiums.
What This Means for Wellness • In order to help these rising costs businesses are seeing the need to reduce claims. • Wellness programs are the answer to this, besides just the benefits of a healthier workforce.
What This Means for Wellness • The government will be establishing programs which will help companies establish wellness initiatives. • The program will create tax incentives for employees who create and utilize wellness. • The federal reimbursement plan is an employment-based plan which directs that employers must implement a program to generate cost savings for employees with chronic or high-cost diseases.
A New Approach • These changes will require a different approach to how employers approach healthcare. • The increased premiums, will make it more expensive for an employer offering their employees health insurance.
Incentivizing Employees • Any wellness program will be helpful, but if it is not being used it will not be effective. • There are many ways to incentivize employee participation in wellness, such as cash incentives and rebates
Gift Cards • A new trend is the use of gift cards as incentives. • They are an effective means of getting employees to engage in wellness.
Employee Engagement • Incentives are important for initial engagement. • These incentives can also be used to continue to boost participation as well, one company reports an increase in participation from 15 to 39 percent with the inclusion of gift cards.
Employee Engagement • Some companies tie giving gift cards to taking an initial HRA or biometric screening. • Also things like living healthier, health coaching, using online tools, and tobacco cessation.
The ROI of Wellness • With out any participation, there will be 0 ROI. • Realistic predictions: • Not see ROI in 1-2 years • Will break even in 2nd or 3rd year • Will see "Reasonable returns" in 4th and 5th year and each subsequent year
The ROI of Wellness • National Institute of Healthcare Reform reports and average ROI of 3.27 to 1 over 3 years. • 2.37 to 1 reduced absenteeism costs • "Ones who do everything right" hard ROI between 1.25 to 1 and 4 to 1.
Why Gift Cards? • Can be limited like CVS Select card. • Does not work when buying cigarettes, alcohol, and candy • Only for "Healthy" items • Can also be given to healthy food options like Subway.
Why Gift Cards • Still gives employees incentives, without the problems cash can bring. • Employees will not feel bad about receiving a gift card with a $10 value • However, an employee may feel slighted by receiving a $10 bill.
Gift Cards in Manufacturing • In manufacturing jobs, gift card incentives are used to motivate employees to engage in safer behaviors. • If this is done systematically with proper measurement methods and a culture of preventing accidents; the company will realize ROI in increased productivity and reduced healthcare premiums
Unsafe Workplaces in Context • The National Safety Council Reports the following data. • There are 3.8 million annual workplace injuries in the U.S., 90,000 of which cause permanent damage. • The average cost per injury is $28,000 for a grand total of $130 billion nationally.
Manufacturing Incentives Example • A company plays “Safety Bingo” once a month, and has been accident free for 15 years. • The same company also rewards employees who they see using the personal protective equipment in the proper manner.
Gift Cards in Nonprofits • Many times when one thinks of gift cards and nonprofit organizations they think of fundraising efforts. • These “Scrip” sell cards to companies in order to fundraise. The Scrip give a percentage of gift card purchases to charities while the consumer spends the gift card normally.
Gift Cards and Nonprofit Operations • Many nonprofits operate on a shoestring budget, from donors, grants, and work from volunteers. • Gift cards in this sense can thank and motivate their donors.
Incentives and Nonprofit Operations • The tools that for-profit businesses use incentives for, can be used by nonprofits as well. These are things like: • Attracting talent • Increasing productivity • Maintaining/increasing goals
Nonprofit Incentives Example • An environmental advocacy group uses gift card to “reward teachers and to benefit students who participate in one of our field trip educational programs” The teachers are given CVS gift cards with which the photos taken at the sandy beach shore can be developed. For many of the students it is their first time at the beach.
Gift Cards in Healthcare • Gift cards are used internally with employees and externally with patients to drive desired long term goals. • Gift cards for health and wellness programs are also the second largest category of gift cards behind “general rewards” which are anniversary and holiday gifts.
Health and Wellness Rewards • Gift cards are frequently given for filing out HRAs to increase participation. • Rewards are also given out as a points system for activities like joining a gym, reaching a milestone in weight loss, lowering blood pressure and taking a walk during a break. • As healthcare costs continue to rise, so will the use of these wellness incentives.
Healthcare Gift Card Examples • The infection control department of a medical center in Mississippi rewards employees who routinely and properly wash their hands. • A medical school in California conducts patient surveys. The person who conducts the most surveys gets a gift card every three months, participants are given a gift card of a smaller amount.
Gift Cards in Insurance • Gift card in the Insurance industry are used in many ways: • A reward for who generates the most leads • Gifts for referrals • Given to customers who sign new policies or keep an appointment with a representative • A reward for completion of a customer who completes a questionnaire
Self-Insured Companies • By using incentives to cut medical expenses and incentivize health and wellness programs self-insured companies have been able to fight the 8 – 10% healthcare inflation rate. • Some have been able to reduce this to as little as 3%
Example of Gift Cards in Insurance • A Pennsylvania based health-insurance provider offers group customers incentives and rewards to get employees active in their health and wellness.
Gift Cards in Utility and Energy • Gift cards are used by Energy and Utility companies to gather business. • Customers are given a promo code when switching utility companies to receive a gift card • Customers who refer a friend are given a gift card as a reward • Customers who lock in a rate are given a gift card reward
Incentivize “Going Green” • Constellation Energy is giving customers who are using less energy a gift card to encourage earth friendly energy use. • Customers post a photo online as to why they are an “energy saving hero” and the winner receives a gift card • Gift cards are also used to get customers to switch to paperless online payment, which further helps the environment. • These are useful ways to increase company branding as an organization which cares for the environment
Customer Service • Just like gift cards are a way to say “thank you” they can be used to say “sorry as well” • If an Energy and Utility company has billing problem or meter error, it is an effective way to apologize for the mistake. • This is a pleasant surprise to the customer, and enhances the customer service experience.
Conclusions • In difficult economic times the use of gift cards is greatly beneficial: • The employee gets the bonus the gift card provides • The employer get the added productivity • The company which issues the gift card gets the added business
Conclusions • The companies who use gift cards as incentives also get the reduced costs a healthier workforce brings.
WE HAVE APPROXIMATELY 9,500 EMPLOYEES Meat Plants Bakery Plants Headquarters
RELAUNCHED WELLNESS PROGRAM JULY 2011 WITH REDBRICK HEALTH Phase 1 Phase 2 Phase 3 • Personal HealthMap • Health Programs • Recommended Care • Biometric screening • Health assessment • Personal profile • Online Tools • Health Record • Reward Bank
WELLNESS PROGRAM HIGHLIGHTS YEAR 1 • 53% of employees either attended a health screening or a completed their health assessment (from less than 5% in 2010); • 35% of employees that completed their health assessment enrolled in a program (e.g. telephonic, online or physical activity tracker); • Visited all locations with > 50 employees for biometric health screeningevents – two locations had nearly 70% participation; • The 1st physical activity and weight loss challenges launched in January 2012, on average participants tracked 6 hours of physical activity and lost 1 poundper week; • The WINNING TEAM lost an average of 25 poundseach!
WHAT WAS DIFFERENT WITH RELAUNCH? • Brought in new Vendor – RedBrick Health • Eliminated ‘Big Brother’ concerns and promoted Privacy of Information; • Grass roots communication – implemented location Champions; • Each location had a minimum of 5 Champions (outside of HR) to help promote the program; • Moved from premium discounts to Gift Cards; • While we kept the incentive amounts the same; employees valued the immediate reward for the completion of tasks;
WHAT IS COMING IN THE FUTURE? • What is Coming in the Future? • Continue strong communication efforts: • Enhance Spousal Communication • Considerations for 2014 and Beyond: • Results based measurement factors • Surcharge/incentives for value based design and programs.
Well-being at Sprint Beyond personal health – Helping employees thrive Oct. 2, 2012
About Sprint • At Sprint, our high-performing, inclusive culture thrives on innovation. • Sprint offers a comprehensive range of wireless and wireline communications services, bringing the freedom of mobility to consumers, businesses and government users. • Sprint is widely recognized for developing, engineering and deploying innovative technologies, including: • The first wireless 4G service from a national carrier in the United States • Offering industry-leading mobile data services, leading prepaid brands, including Virgin Mobile USA, Boost Mobile and Assurance Wireless • Instant national and international push-to-talk capabilities • Newsweek ranked Sprint No. 3 in its 2011 Green Rankings, listing it as one of the nation's greenest companies, the highest of any telecommunications company.
Incentive Strategy- Creating a Thriving Culture • Multi-Tiered Approach for various well-being programs that include • Points earned via Sprint’s recognition portal • Opportunity to purchase rewards on portal such as merchandise, gift cards, etc. • Gift Cards donated by Sprint partners or provided by Sprint • Premium Discounts towards medical/prescription drug premiums • Funding towards health reimbursement accounts • Donations contributed to Sprint Charities • Donation of Sprint product/services or vendor donated product/services • Onsite incentives for participation or completion of events- healthy food; drawing prizes
Sprint Alive! Health AdvocateA new service for all employees and eligible dependents • Sprint Alive!, Sprint’s well-being program administered by Optum launched a new concierge health and well-being service to it’s employees and health plan members, with the roll out running from July 17th through September 18th • Creates a personal approach • Health Advocates are available to help Sprint employees and their families navigate the health care system by: • Finding high quality providers and scheduling appointments • Researching health and benefit questions • Doing the leg-work to make life a little easier!
Health Advocate incentive • All employees received a personalized email as well as a home mailing for launch of program • As part of the roll out, employees may have received an incentive to earn a $5.00 Starbucks gift card and chance to win a Tablet. • Employees and dependents working with their Health Advocate will become aware of programs available to them and the rewards provided for completion of online and telephonic programs.