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Health as a Serious Economic Strategy THE UNIVERSITY OF MICHIGAN

Health Management as a Serious Economic Strategy: The Critical Role of the Healthy and High Performing Workplace and Work Force. Health as a Serious Economic Strategy THE UNIVERSITY OF MICHIGAN HEALTH MANAGEMENT RESEARCH CENTER Dee W. Edington. Business and Community Problem

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Health as a Serious Economic Strategy THE UNIVERSITY OF MICHIGAN

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  1. Health Management as a Serious Economic Strategy: The Critical Role of the Healthy and High Performing Workplace and Work Force Health as a Serious Economic Strategy THE UNIVERSITY OF MICHIGAN HEALTH MANAGEMENT RESEARCH CENTER Dee W. Edington

  2. Business and Community Problem Currently, most costs associated with workplace and workforce performance are growing at a rate faster than is sustainable How are we going to be successful in this increasingly competitive world without a healthy and high performing workplace and workforce? How can we turn costs into an investment?

  3. UM-HMRC Corporate Consortium • Ford • Delphi • Kellogg • US Steel • We Energies • JPMorgan Chase • Delphi Automotive • Southern Company • Navistar Corporation • University of Missouri • Medical Mutual of Ohio • Florida Power and Light • St Luke’s Health System • Allegiance Health System • Cuyahoga Community College • United Auto Workers-General Motors • Wisconsin Education Association Trust • Australian Health Management Corporation • Steelcase (H) • General Motors • Progressive (H) • Crown Equipment • Affinity Health System • SW MI Healthcare Coalition (H) *The consortium members provide health care insurance for over two million individuals. Data are available from three to 20 years. Meets on First Wednesday of each December in Ann Arbor.

  4. New way to do Health Management In the United States and Throughout the World UM-HMRC Ann Arbor X New Ulm X

  5. Zero Trends: Health as a Serious Economic Strategy • Building a Sustainable Business and Economic Strategy • Workshop: Champion Companies, Zero Trends Eight Hours • Complete Strategy/Champion Company Four Hours • Fundamental Strategy/Champion Company Two Hours • Business Strategy/Champion Company 90 minutes • Short Business Strategy/Champion Company 75 minutes • Executive Summary of Zero Trends 45 minutes • Executive Summary of Executive Summary 30 minutes

  6. Heart of New Ulm Population Health Management as a Serious Economic Strategy: November 10, 2009 Mission Change the Strategy for Health and Disability from a Health Strategy to an Economic Strategy Natural Flow of a Population 15 High Risks and High Costs Business Case 10 Health as an Economic Strategy Solutions 25 Five Pillars to Support a Culture of Health All slides are available

  7. Section I The Current Healthcare Strategy Natural Flow Wait for Sickness and then Treat (…in Quality terms this strategy translates into “wait for defects and then fix the defects” …)

  8. Health Risk Measure Body Weight Stress Safety Belt Usage Physical Activity Blood Pressure Life Satisfaction Smoking Perception of Health Illness Days Existing Medical Problem Cholesterol Alcohol Zero Risk High Risk 41.8% 31.8% 28.6% 23.3% 22.8% 22.4% 14.4% 13.7% 10.9% 9.2% 8.3% 2.9% 14.0% Estimated Health Risks From the UM-HMRC Medical Economics Report Estimates based on the age-gender distribution of a specific corporate employee population OVERALL RISK LEVELS Low Risk 0-2 risks Medium Risk 3-4 risks High Risk 5 or more

  9. Risk Transitions (Natural Flow) Time 1–Time 2 2,373 (50.6%) 4,691 (10.8%) 1,961 (18.4%) 5,226 (12.1%) 892 (3.2%) 4,546 (42.6%) 10,670 (24.6%) 1640 (35.0%) 678 (14.4%) 11,495 (26.5%) 5,309 (19.0%) 4,163 (39.0%) 27,951 (64.5%) 26,591 (61.4%) 21,750 (77.8%) High Risk (>4 risks) Medium Risk (3 - 4 risks) Low Risk (0 - 2 risks) Average of three years between measures Modified from Edington, AJHP. 15(5):341-349, 2001

  10. Costs Associated with Risks Medical Paid Amount x Age x Risk AnnualMedicalCosts High Med Risk Non-Participant Low AgeRange Edington. AJHP. 15(5):341-349, 2001

  11. The Economics of Health Status • Total Value of Health • Medical/Hospital • Drug • Absence • Disability • Worker’s Comp • Effective on Job • Recruitment • Retention • Morale Disease

  12. Learnings from Section I The flow of Risks is to High-Risk The flow of Costs is to High-Cost Costs follow Risks and Age

  13. The world we have made as a result of the level of thinking we have done thus far creates problems we cannot solve at the same level of thinking at which we created them. - Albert Einstein

  14. Section II Build the Business Case for the Health as a Serious Economic Strategy Engage the Total Population to get to the Total Value of Health Complex Systems (Synergy & Emergence) versus Reductionism (Etiology)

  15. Business Concept Health Risks are Associated With Disease and Costs

  16. Excess Diseases Associated with Excess Risks (Heart, Diabetes, Cancer, Bronchitis, Emphysema Percent with Disease High Med Risk Low Risk Age Range Musich, McDonald, Hirschland, Edington. Disease Management & Health Outcomes 10(4):251-258, 2002.

  17. Business Concept Excess Costs follow Excess Risks

  18. Excess Medical Costs due to Excess Risks $5,520 $3,460 $3,039 $2,199 Edington, AJHP. 15(5):341-349, 2001

  19. Association of Risk Levels with Corporate Cost Measures Wright, Beard, Edington. JOEM. 44(12):1126-1134, 2002

  20. Business Concept Change in Costs follow Change in Risks

  21. Change in Costs follow Change in Risks Cost increased Cost reduced Risks Reduced Risks Increased Overall: Cost per risk reduced: $215; Cost per risk avoided: $304 Actives: Cost per risk reduced: $231; Cost per risk avoided: $320 Retirees<65: Cost per risk reduced: $192; Cost per risk avoided: $621 Retirees>65: Cost per risk reduced: $214; Cost per risk avoided: $264 Updated from Edington, AJHP. 15(5):341-349, 2001.

  22. Business Concept Change in Costs Follow Engagement

  23. The average annual increase in absence days (1995 – 2000): Participants: 2.4 Non-Participants: 3.6 1.2 Work Days Participant Year $200 Work Day $623,040 Year X X 2,596 participants = Yearly Average Disability Absence Days by Participation Pre-Program Program Years Schultz, Musich, McDonald, Hirschland,Edington. JOEM 44(8):776-780, 2002

  24. Business Concept Eliminate “Silo” Thinking Consider theTotal Value of Health

  25. Total Value of Health Medical & Pharmacy Worker’s Compensation Presenteeism LTD STD Absenteeism Time-Away-from-Work Edington, Burton. A Practical Approach to Occupational and Environmental Medicine (McCunney). 140-152. 2003

  26. The Economics of Health Status • Total Value of Health • Medical/Hospital • Drug • Absence • Disability • Worker’s Comp • Effective on Job • Recruitment • Retention • Morale Health Risks Disease

  27. The world we have made as a result of the level of thinking we have done thus far creates problems we cannot solve at the same level of thinking at which we created them. - Albert Einstein

  28. Medical and Drug Cost (Paid)* Slopes differ P=0.0132 Impr slope=$117/yr Nimpr slope=$614/yr Improved=Same or lowered risks

  29. Zero Trends follow “Don’t Get Worse” and “Help the Healthy People Stay Healthy”

  30. The Economics of Total Population Engagement and Total Value of Health Total Value of Health Medical/Hospital Drug Absence Disability Worker’s Comp Effective on Job Recruitment Retention Morale Low or No Risks Health Risks Disease increase increase decrease Where is the Investment?

  31. Learningsfor Section II Excess Costs are related to Excess Risks Costs follow Engagement and Risks Controlling Risks leads to Zero Trend

  32. Section III The Evidence-Based Solution: Integrate Health into the Culture (…in Quality terms this strategy translates into “…fix the systems that lead to the defects” …)

  33. Business and Community Problem Currently, most costs associated with workplace and workforce performance are growing at a rate faster than is sustainable How are we going to be successful in this increasingly competitive world without a healthy and high performing workplace and workforce? How can we turn costs into an investment?

  34. Vision for Zero Trends Zero Trends was written to be a transformational approach to the way organizations ensure a continuous healthy and high performing workplace and workforce

  35. Integrate Health into Core Business Healthier Person Better Employee Gains for The Organization 1. Health Status 2. Life Expectancy 3. Disease Care Costs 4. Health Care Costs 5. Productivity a. Absence b. Disability c. Worker’s Compensation d. Presenteeism e. Quality Multiplier 6. Recruitment/Retention 7. Company Visibility 8. Social Responsibility Lifestyle Change Company Culture and Environment SeniorLeadership Operations Leadership Self-Leadership Reward Positive Actions Quality Assurance Health Management Programs 1981, 1995, 2000, 2006, 2008 D.W. Edington

  36. Five Pillars of a Population Health Management System

  37. Five Fundamental Pillars

  38. Senior Leadership • Create the Vision • Commitment to healthy culture • Connect vision to business strategy • Engage all leadership in vision “Establish the business value of a healthy and high performing organization and workplace as a world-wide competitive advantage”

  39. OperationalLeadership • Align Workplace with the Vision • Brand health management strategies • Integrate policies into health culture • Engage everyone “You can’t put a changed person back into the same environment and expect the change to hold”

  40. Population Health Management Strategy Sickness Management --reduce errors --coordinate services Disease Management --stay on protocol --don’t get worse Health Management --healthy stay healthy --don’t get worse Where is the economic strategy?

  41. Mission and Values Aligned with a Healthy and Productive Culture Policies and Procedures Aligned with Healthy and Productive Culture Environment Interventions • Vending Machines • Job Design • Cafeteria • Flexible Working Hours • Stairwells • Smoking Policies • Benefit Design Aligned with a Healthy and Productive Culture • Management and Employees prepared to integrate health into the company culture (small group meetings, shared vision, expectations,…)

  42. Health Advocate • Provide Direction • Get the Care You Need • Coaching & Outreach Health Plan Design Environmental Design • Behavioral Health • Work/Family • Work Life Plus • Disease Management • High Acuity (identified high cost disease) • Low Acuity (identified lower cost disease; lifestyle behavior focus) • Health Portal • Stay healthy • Health information • Make informed choices Total Health & ProductivityManagement • Health Risk Assessment • Assess and track health behaviors • Maintain health • Address health risks Case Management • STD, LTD • Workers’ Compensation • Scattered Absence • Fitness Centers • Low risk maintenance • High risk reduction Absence Management • Wellness Programs • Active expansion • Retiree communications/awareness program • On-site Medical, H&S • Diabetes education pilot • Injury and medical management • Occupational Health and Safety Create an Integrated and Sustainable Approach Long Term Strategy—Short Term Solutions

  43. Operational Leadership: Align workplace with vision Operations management support Sr. Leadership vision Management health champions identified Create employee wellness committees with manager participation Health presentations included during Safety meetings Include health as a performance indicator at line management level Employee wellness coordinators appointed at each site Integrated approach to health and well-being Robust branding and marketing & communication strategy

  44. SelfLeadership • Create Winners • Help employees not get worse • Help healthy people stay healthy • Provide improvement and maintenance strategies “Create winners, one step at a time and the first step is don’t get worse’

  45. Individual Strategy for Engagement Health Risk Appraisal Biometrics Screening and Counseling Contact a Health Advocate Two Other Activities

  46. Weight Management Business Specific Modules Physical Activity Career development Stress Management Communications Safety Belt Use Financial Management Smoking cessation Social/Information Networks Nutrition Education Disease Management Clinic or Medical Center On-Line Information Ergonomics Nurse Line Newsletters Vision Dental Behavioral Health & EAP Hearing Pharmacy Management Chiropractic Complementary Care Case Management Integrative Medicine Absence Management Physical Therapy Disability Management Population-Based Resources

  47. Self Leadership: Create Winners • Employees have access to health resources before, during, and after work hours • Environment supports culture of health - Food services, Fitness center, Health centers, - Health Promotion, EAP, Other • Provide wellness programs to address all levels of a health continuum: Healthy -At Risk-Chronic-Catastrophic • Health coaches • Decision support tools • Employees, dependents, and retirees are eligible to participate Alignworkplace with vision

  48. Reward Actions • Reinforce the Culture of Health • Reward champions • Set incentives for healthy choices • Reinforce at every touch point “What is rewarded is what is sustained”

  49. Culture reminders (Managers, Leaders,…) Cash, debit cards ($25 to $200) Benefit Design (HSA contributions) Hats and T-Shirts Population programs Surprise events Decorate stairwells Special cafeteria/vending offerings Organizational rewards (Departments…) Positive Re-Enforcement

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