The Business of Preventative Wellness

By: Connor Ruby

Health and Wellness

Wellness vs. Comprehensive Health Management

Activity Wellness Program

Comprehensive health management program

What does your

organization offer?

Has at least 80% participation in your program Not expected Expected  

Require a primary care physician of record Not necessary yes  

Annual physical Not necessary After 40 years  

Annual health screening (blood pressure, cholesterol screening, triglycerides and blood glucose) Not necessary Yes

 

Annual or biennial health risk appraisal Not necessary yes  

Regularly scheduled appointment with health coach (at least two times a year) Not necessary yes  

Appropriate health screenings or exams by specialists for men and women Not necessary yes  

Periodic wellness challenges Generally offered Generally offered  

Benefits incentive programs Not necessary Generally offered  

Periodic educational programs/health fairs for employees and families Generally offered Generally offered

 

Employee wellness advisory committee Generally offered Generally offered  

Mission Statement“Intellectuals solve problems, geniuses prevent them.” – Albert Einstein

We believe in moving from the current “wait for illness” level of thinking to a higher level of thought, that is, “promotion of wellness.”◦ This type of mindset will ultimately lead to financial savings

and will also enhance people’s ability to lead meaningful lives. Wellness programs were founded on the urgency and passion

for people, the business community, our country, and the world. We must create social and physical environments to enable individuals and their families to succeed.

The data and information provided in this presentation will support the argument that improved health will not only reduce healthcare costs for companies, but also increase performance and productivity in the workplace.

Low or No Risk • Decrease Cost

Health Risks • Increase Cost

Disease

• Increase Cost

Where is the investment?

Total Cost of Health

• Sickness• Drug• Absence• Disability• Workers'

Compensation• Effectiveness on the

Job• Recruitment• Retention• Morale

Cited: University of Michigan Health Management Research Center.

One of the root causes of unsustainable growth in health care costs is the natural flow of individuals from low risk to high risk.

Wellness programs develop a strategy to lower health care costs and increase productivity by focusing on the culture of the organization, the health status of the employees and help the healthy people stay healthy.

How will a new wellness program be able to help your business?

Our StrategyInstead of waiting for sickness, we strongly

believes in the preservation of health.Healthier employees are more productive,

have fewer injuries, and lower medical costs.

Current HighlightExcess costs increase

exponentially as individuals move from low risk to high

risk categories

Changes in healthcare costs follow changes in health risk. As

the number of risks goes up, costs go up. As the number of

risks goes down, costs go down.

150% increase in medical costs due to

growth in risk

Excess Medical Costs Due to Excess Risks in IndividualsRisk Level Base Cost Excess Cost Total Cost

Low Risk (0-2 Risks) $2,199 $2,199 HRA Nonparticipant $2,199 $840 $3,039 Medium Risk (3-4 Risks) $2,199 $1,261 $3,460 High Risk (5+ Risks) $2,199 $3,321 $5,520

Our StrategyImproved health status will not only reduce healthcare

costs for companies but also increase performance productivity in the workplace.

Current HighlightPresenteeism (60% of monetary costs) is time lost while at work because health risks or disease impacts

one’s ability to complete work-related tasks.

Relative Costs of the Total Value of HealthMonetary Costs Weight Indirect vs. Direct

Presenteeism 60% Indirect CostsMedical & Pharmacy 20% Direct CostsSTD (Short Term Disability) 9% Indirect CostsAbsenteeism 8% Indirect CostsLTD (Long Term Disability) 2% Direct CostsWorkers' Compensation 1% Direct Costs

Cited: Edington, Burton. A Practical Approach to Occupational and Environmental Medicine.

What effect will this have on profit?

Our StrategyLower health care costs and increase productivity by focusing

on the culture of the organization.

Current HighlightIndirect costs are often overlooked by medical costs, workers’ compensation, and LTD. Research shows majority of cost comes from Presenteeism; work lost while in the office.

Relative Costs of the Total Value of HealthIndirect vs. Direct Weight

Indirect Costs 77%Direct Costs 23%

Direct Costs

Indirect Costs

Our StrategyFocusing on risk reduction alone is flawed. HWI provides

an intellectual, easy to use product that will increase wellness scores and decrease costs.

Current HighlightOne point increase in wellness score equals to a

$56 decrease in cost.

As health improves, medical costs decrease

substantially.

Relationship Between Medical Costs and Wellness

ScoreWellness

ScoreAnnual

Medical Costs65 $2,817 70 $2,508 75 $2,369 80 $2,087 85 $1,800 90 $1,643 95 $1,415

One Point in Wellness Score = $56

Yen, McDonald, Hirschland, Edington. JOEM

Our StrategyThe top six diseases (allergies, back pain,

cholesterol, heart burn/acid reflux, blood pressure, and arthritis) are not typically expensive in terms

of medical and pharmacy costs, but they do impact quality of life and productivity on a daily

basis.

Increased productivity could lead to increased profits or increased reinvestment in the business resulting in more jobs for the local economy. Also,

more profit leads to increased tax revenue for local, state, and national government units.

Current HighlightsThe difference of 1.02 work days per participant leads to over $.5 million in excess

costs.

Yearly Average Disability Absence Days by Participation

Program Year Participant Nonparticipant

0 5 51 5.8 6.62 6.9 8.83 8.7 124 14.1 17.65 15.7 21.26 17.2 23.3

The average annual increase in absence days for a 6 year period: Participants: 2.03 Nonparticipants:

3.05

$200 per

work day

1.02 work days per

participant per year

2,596 participants

$529,584 per year

Wellness Program

Nutrition Education

Provide Direction Provide Education Health Information

Health Portal Coaching and

Communication Make informed

choices Stay Healthy

Health Risk Assessment

Assess and tracks health behavior

Maintain health Address health

risksWeight Loss / Management Low risk

maintenance High risk reduction Address healthy

risks

Disease Management /

Prevention Diabetes education Injury and medical

prevention

Absence Management STD, LTD Workers’

Compensation Scattered absence

Create an integrated and sustainable approach

Wellness CultureEmployers create environments that

encourage their employees to stay well, in addition to taking care of their employees when they are ill.

Comprehensive health benefit design, recognition, rewards, social networks and more.

Change the definition of health from the absence of disease to the presence of energy.

Maximize potential of optimal health“Vision without action is a daydream. Action without vision is a nightmare.”

Senior Leadership

• Commitment to healthy culture• Connect Vision to business strategy• Engage all leadership in vision

Self-Leadership

• Integrate policies into health culture• Help healthy people stay healthy• Engage and motivate individual leaders

Reward Positive Actions

• Reward champions• Set incentives for healthy choices• Reinforce at every touch point

This presentation is separate from Health and Wellness Innovations.

My research stems from “Zero Trends” by Dee W. Edington, Ph.D.