Nathan Kleinman, PhD Senior Research Analyst and Consultant Human Capital Management Services

1. Introduction to Employer Health Benefit Data Types and Uses Nathan Kleinman, PhD Senior Research Analyst and Consultant Human Capital Management Services Adjunct Assistant Professor, College of Business University of Wyoming

2. Introduction to Employer Health Benefits Data • Types of Employer Benefits & Data • Levels of Data Granularity • Examples of Employer Data • The Need for Data Integration • Data Uses • Business Management • Research

3. Types of Employer Benefits & Data

4. Types of Employer Benefits & Data • Demographics, Salary, Job Type, etc. • Birth Date • Gender • Hire Date • Race • Salary • Exempt Status • Full-time/Part-time Status • Job Type • Job Title • Etc.

5. Types of Employer Benefits & Data • Health Benefits • Health Insurance (HMO, PPO, Indemnity) • Prescription Drugs (Brand vs. Generic, Tiers) • Dental • Vision • Etc.

6. Types of Employer Benefits & Data • Health Risk Appraisals • May include questions about: • Height • Weight • Blood pressure • Smoking status • Alcohol consumption • Exercise • May be required to get lower health insurance premium or in conjunction with gym membership • May be administered by corporate doctor or may be self-report

7. Types of Employer Benefits & Data • Health-related Absence • Sick Leave • Short-term Disability • Long-term Disability • Workers’ Compensation • Family & Medical Leave Act (FMLA)

8. Types of Employer Benefits & Data • Other Absence • Vacation • Paid Time Off (PTO) • Holidays • Floating Holidays • Military leave • Bereavement leave • Others

9. Types of Employer Benefits & Data • Productivity, Performance • Population examples • Profit per store • Graduates per professor • Person-level examples • Self-report productivity surveys • Manager performance reviews • Widgets produced, calls answered, boxes moved per day

10. Levels of Data Granularity

11. Levels of Data Granularity • Population • Each record summarizes data for many people • Person • One record per person • Leave • Example: One record per sick leave episode or disability leave of absence • Possibly several records per person • Transaction, Payment • Example: One record per medical service or prescription • Example: One record per disability leave payment • Many records per person

12. Employer Data Examples

13. Data Examples – Health Insurance Claims

14. Data Examples – Prescription Drug Claims

15. The Need for Data Integration

16. The Problem of Separate Silos Sick Leave Data Workers’ Comp Data Drug Data Disability Data Human Resource Data Health Care Data Productivity Data

17. Cost Shifting from One Benefit Silo to Another Hokey Corporate Benefits Manager $$$ Total Cost Balloon

18. Integrated Information Eliminates Silos Sick Leave Data Workers’Compensation Data HR Data Productivity Data Disability Data Drug Data Medical Insurance Data Integrated Person-Centric Database

19. Uses of Employer Data

20. Business Management

21. Sample Employee Total Compensation Analysis(A Days Pay for a Days Work)

22. Sample Integrated Health Benefits Trend Analysis Adjusted for Inflation

23. Integrated Benefits ManagementAd Hoc Pareto Analysis Analytic Finding: 14 percent of the workers used 80 percent of the total health benefits claim cost. Pareto Group 14% 80% 27.6% STD/LTD Non-Pareto Workers 86% Non-Pareto Costs 20% 8.6% WC Ind. GH 35.2% 8.6% WC Med. EMPLOYEES TOTAL HEALTH CLAIMS COST Non-Pareto WC Indemnity WC Medical Pareto Group Health STD/LTD Source: OCI Research Group

24. Person-Centric/Human Capital Approach The Type of People Using Health Benefits STD Cost per Person 4% All % of WCI % of LTD STD WCI WCM GHM Benefits Total 10% People People $ $ $ $ $ $ Cost WCM No 90% 0 0 0 48 504 551 26% 9% Disability Claims With 10% 1,290 1,912 5,399 3,361 3,391 15,352 74% Disability Claims GHM Medical Managed Care 74% Integrated Disability and Total Benefits Management Benefits-Centric/Medical Approach The Type of Health Benefits People Use LTD 3% Source: OCI Research Group

25. Age 14.418% 4.121% WC Wait Period 1.791% Female Sick Leave 1.310% Exempt -1.958% -5.538% STD Wait Period -13.208% Pay for Performance Increases in LTD Claims Rate From a 10% Increase in each Variable -15.000% -10.000% -5.000% 0.000% 5.000% 10.000% 15.000% 20.000% WC Claims 0.833% 0.768% POS Medical Plan East Region 0.543% West Region 0.452% 0.324% STD Claims Medical Insurance Costs 0.070% FMLA Claims 0.003% 0.001% Suspensions

26. Sample Integrated Health Benefits Pareto Analysis with Dependent Costs Average Cost: $2,000

27. Pareto 1st and 5th Quintile Utilization Comparative Analysis Time Period 10/1/04 – 9/30/05

28. Diabetes/Cardio Metabolic Integrated Disease Pareto Analysis Time Period 7/1/04 – 6/30/05

29. Integrated Cost ProfileMental and Nervous Claimants Other Medical Cost $2,933 WC Cost $1,867 Disability Cost $18,010 Productivity Loss Cost $4,300 Administrative Cost $854 3,637 People over 2 years Mental & Nervous ICD9s $854 (3% of Total) Total Health & Productivity Cost $28,818

30. Health Benefits Cost Shifting Analysis • Analysis comparing WC costs for HMO and Traditional Health Care Plans# of EmployeesWC CostsTraditional Health Plan 18,000 $ 850HMO 4,000 $1,200 • Potential Savings: $1.4M annually ($350 per employee)

31. Research

32. Cost of Bipolar Disorder

33. Descriptive ComparisonEmployees with Bipolar Disorder vs. Employees without Bipolar Disorder

34. Comparison of Annual Cost per Person

35. Comparison of Annual Absence Days per Person

37. Real Annual Productivity Output

40. Average Benefit Cost for Employees with Bipolar Disorder by Medical and Drug Cost Quintile