Thursday, February 17, 2011

Will the Wellness Generation Bend the Cost Curve?

I’m bending the cost curve.

Please, hold your applause.

I’m part of the Wellness Generation. I eat healthfully. I ride my bike to work every day, year round (OK, I've been known to wimp out if the morning forecast calls for negative anything. And, let's just say that the bike lanes were not the top priority for Chicago’s snowplow brigade following the Blizzard of 2011. Still, I log well over 2,500 miles a year on my commuter bike). I try to get in an extra workout 3-4 times a week. I get my flu vaccine every year. I'm pretty good at managing my asthma and haven't been forced to make any ED visits for that chronic condition in years. Yeah, I’d say I’m putting a little flex into that billion dollar cost curve.

Thankfully, my employer sees the benefit of wellness. For years, the American Hospital Association has enhanced our health benefits with access to such things as a fitness club, Weight Watchers, yoga, acupuncture and more. The AHA also recently started offering the Bicycle Commuter Tax Benefit. Employees share in the cost of some of these benefits, but the expenses are relatively minor when compared to what we'd pay on the open market.

The AHA is not alone. Seven in 10 employers responding to a recent Fidelity Investments and National Business Group on Health survey reported offering 19 or more health improvement programs in 2010 and the number is expected to climb as businesses try to bend their own cost curves. Last year, 50% of employers added one new wellness program to their menus; 63% said they’d do so in 2011.

Estimates vary widely about how much money is at stake. A report issued last summer by the Center for Health Research at Healthways suggested that employers could trim $1 trillion (yes, "trillion" with a "t") over 10 years through risk reduction and prevention programs. But the Center for Studying Health System Change, in a report it pulled together for the National Institute for Health Care Reform, found a mixed bag. Importantly, the report stated that ROI is very hard to measure. The center also noted that financial incentives are the key to engaging employees, which is similar to findings in the Fidelity/NBGH survey.

Hospitals have a double incentive for becoming active on the wellness front. First, as large employers, they can potentially drive down their own health care costs. But secondly, there's a potential new market to capture patients and enhance patient loyalty. Officials at North Shore-LIJ Health System seem to understand this. The New York-based health system is positioning itself as a wellness provider. Late last year, it opened a 15,000-square-foot fitness center and plans to open more. Initially, North Shore is targeting its 42,000 employees and their families, but non-employees are eligible to join and workout as well.

With health reform's emphasis on prevention and improving population health, it only stands to reason that wellness initiatives will continue to become more popular. And who knows, maybe collectively we can put a real arc into that cost curve.

As for me, I won't be cycling next week. Instead, I’ll get my 2,000 miles by walking the halls of the cavernous Orlando Convention Center while attending HIMSS11. Look for my updates on our H&HN Daily blog page.


Kevin Van Dyke said...

Another good link to share is the AHA's 2010 Long-Range Policy Committee Report on hospital employee health and wellness. The report includes results of a survey of 876 hospitals, hospital case studies, and seven actionable recommendations for the field. The links to this hospital guide and an upcoming AHA HPOE webinar can be accessed at

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