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Take credit for reducing top health care cost drivers: Follow these steps(AHC Newsletters Via Acquire Media NewsEdge) Take credit for reducing top health care cost drivers: Follow these steps [Editor's Note: This is a three-part series on using financial data to demonstrate the value of occupational health programs. This month, we show you how to link programs to the top health care cost drivers at your workplace. In previous months, we reported on how wellness programs impact business objectives, and gave strategies to take credit for health care cost savings.] Use data to get a "seat at the business table" Can you name the high cost drivers at your workplace for workers' compensation claims? What about group insurance claims for non-occupational illnesses and injuries? If you don't know this information, you won't be able to develop programs to prevent and control these conditions?a lost opportunity to save your company a lot of money, warns Annette B. Haag, MA, RN, COHN-S/CM, FAAOHN, a Simi Valley, CA-based consultant. "I am still amazed when I ask nurses: What is the estimated dollar amount that your company pays in health care costs and workers' compensation? Can you list the three top cost drivers in each of these areas? And many cannot," says Haag. However, when OHNs ask human resources or risk management personnel for this information, the attitude is often "Why do you need to know that?" "You need to educate management about their health care costs and top cost drivers and how you can impact these," says Haag. "You don't want to put your resources into a program that returns nothing." She recommends saying the following: "As an OHN, one of my key responsibilities is to continuously monitor these costs, bring them to your attention and assist you in designing specific safety and health programs to reduce healthcare costs. For example, reducing workers' compensation costs can significantly reduce your loss ratio, resulting in a decrease in insurance premiums." By developing, implementing and managing programs that demonstrate a positive outcome, you can "get a seat at the business table," says Chris Kalina, MBA, MS, RN, COHN-S/CM, FAAOHN, director of global occupational health programs and services at Wm. Wrigley Jr. Company in Chicago, IL. "Several years and jobs ago at another company, I was promoted from a staff position into management because I was able to demonstrate cost savings on various occupational health and safety programs," she says. Follow these steps to show your impact on high-cost drivers: Assess the current health promotion programs that are in place. "Then look at the balance sheet of the business to see what the biggest cost drivers are, and determine strategies to mitigate the identified risks," says Kalina. Get a fuller picture of health care costs. OHNs typically provide reactive care for occupational injury or illness, and focus solely on those reports. "By also bringing employees into the clinic for preventive or disease management, and obtaining aggregate data from health benefits plans, you can get a much more complete picture of the population's health status," says Karen Griffith, global health, well-being and productivity senior program manager at Chandler, AZ-based Intel Corporation. "Our goal is to better develop our programs, so we can not only decrease work-related injuries and illnesses, but also improve employee health and lower healthcare costs," says Griffith. By monitoring risk factor improvements and safety indicators in conjunction with individual healthcare benefits program costs, you can see whether programs are improving the health of employees over time. Several new wellness and prevention programs have been added at Intel based on programs outcome information. "We recently expanded our smoking cessation program as a result of health risk assessment data, and are piloting some innovative musculoskeletal disorders impact reduction programs onsite," reports Griffith. Identify high-cost drivers. Cardiac conditions, hypertension and diabetes are the likely suspects for high-cost drivers, but high-risk pregnancies, sleeping disorders, and depression also incur significant costs. "These are areas that individuals don't often think about, and we are not doing a very good job of analyzing the data to identify these," says Haag. To discover hidden cost drivers, work directly with the department that negotiates your company's healthcare benefits contract to obtain data on cost per illness. "This is the easiest way to obtain objective, valid data on how much illnesses and injuries are costing your company," says Kalina. Determine which diseases are endemic in the employee population, then calculate the expected prevalence over the next 10 or 20 years, advises Kalina. "Everybody talks about diabetes, but Hepatitis C is becoming more prevalent among young people. So you can predict that cases will increase, and project that increase for all of the associated costs with liver damage," she says. Estimate ROI for a program before it's started. Before dedicating limited time and resources to a program, understand upfront what the value is. "Programs that are not planned in a way where clinical and business value can be demonstrated will be the first casualty when a cost crunch occurs," says Kalina. For instance, a flu shot program isn't likely to be cost effective if the employee's insurance covers it or they can get vaccinations from the corner pharmacy?it's better to offer a resource that the employee can't get otherwise. "If management doesn't understand the business rationale for a program, let it go?unless for some reason the program is critical to the health and welfare of the employee," says Kalina. Not every program will demonstrate a high return on investment in terms of dollars. "But there are other gains in occupational health and safety that should be measured, both short and long term," says Kalina. These include improved employee morale, reduced absence, improved work-life balance, reduced safety costs and reduced turnover. Involve others. To get the data you need, enlist the help of facilities, finance, environmental health and safety managers and human resources. "Don't let them tie your hands if you have limited resources?ask for assistance," says Haag. "Ask for the support you need to get your analysis done?time, additional computer programs, or personnel." Once you have team involvement with tackling costs, you have a valuable asset: Everybody's buy-in. "Then, obtaining data and getting information from supervisors becomes much easier, and they share in the satisfaction of a job well done," says Kalina. Take credit for savings. Connect the safety and health promotion programs you put in place with reduced insurance premium costs?for example, you may get a 20% discount on the manual rate you pay in workers' compensation premiums because your losses are minimal. "If you have done a phenomenal job in reducing back injuries, do you want to be compared with other employers who don't do that and pay high workers' compensation premiums? Of course not," says Haag. "Show that you are bringing the premiums down because the costs are controlled. If the company had a 200% loss ratio and the ratio has dropped to 90%, take credit for that?you have brought that ratio down." Resist the urge to "fudge the figures," warns Kalina. "That is the kiss of death in regards to your credibility and future programs, because a savvy business person will see that," she says. "Always get your figures from an objective source? your insurance company's calculations on utilization, or an electronic process in place to calculate absences. You have to be able to defend your data." A common mistake is to inflate savings when costing out prevention programs. "Be careful of this?how do you say in 10 years you will eliminate six lung cancers?" says Haag. "If you don't know the numbers, don't use them." SOURCES For more information on identifying drivers of health care costs, contact: Karen Griffith, Global Health, Well-being and Productivity Senior Program Manager, Intel Corporation, Chandler, AZ. Phone: (480) 715-8691. E-mail: [email protected]. Annette B. Haag, MA, RN, COHN-S/CM, FAAOHN, President, Annette B. Haag & Associates, Simi Valley, CA. Telephone: (805) 581-3234. E-mail: [email protected]. Chris Kalina, MBA, MS, RN, COHN-S/CM, FAAOHN, Director, Global Occupational Health Programs and Services, Wm. Wrigley Jr. Company, Chicago, IL. Phone: (312) 645-3770. E-mail: [email protected] Health Management Copyright ? 2008 AHC Media LLC. All Rights Reserved. |