Employee Wellness Programs ASSE Breakfast October 19, 2006

1. Employee Wellness ProgramsASSE Breakfast October 19, 2006 Presented by: Amanda Hess Business Development Genesis Occupational Health

2. Why are medical costs out of control? • Technology • Medicare/Medicaid Reimbursement • Longer Life Spans/Aging Population (90yrs. by 2050) • In the year 2010, the proportion of the workforce greater than 54 years of age will equal the proportion under 25 years of age, i.e., 19 percent. (April 18, 2002, Edward J. Bernacki, MD,President of the American College of Occupational and Environmental Medicine (ACOEM) • Increases in Chronic Diseases

3. Healthcare Costs “We at HHS, and employers everywhere, recognize that poor health means lower productivity and higher health insurance costs. Government, businesses and especially individuals must do more to lead healthy lifestyles. Our physical health and our economic health depend on it.” Tommy G. Thompson Secretary of Health and Human Services US Department of Health and Human Services “Prevention Makes Common Cents (September 16, 2003)”

4. Rising Chronic Diseases • More than 1.7 million adults in the US die of chronic diseases every year - 70% of all deaths in the US are due to chronic conditions • 5 major chronic diseases • Heart disease • Stroke • Cancer • Chronic Obstructive Pulmonary Diseases (COPD) • Diabetes

5. QC Health Initiative - 2002 Survey www.qchealthinitiative.org Heart disease • Leading cause of death in Scott County • Higher average death rates than Iowa and the nation • 1 in 4 adults in Scott & RI have high blood pressure Cancer • Second leading cause of death in Scott County • Higher rates than the state and the nation • 2/3 attributable to lifestyle- diet, tobacco, alcohol, sedentary Stroke • Ranks third in causes of death locally Obesity • Over 64% of adults in Scott & RI are overweight or obese

6. Diabetes Epidemic Diabetes Costs Healthcare costs due to diabetes rose by $98 billion dollars from 1997 to 2002.

7. Healthcare Costs Obesity-related Healthcare Costs (major contributor to musculo-skeletal injuries/conditions) • TOTAL $13 billion in 1994 • $8 billion in health insurance costs • $2.4 billion for sick leave • $1.8 billion for life insurance • $1 billion for disability insurance Direct and Indirect costs for overweight or obese individuals • TOTAL $117 billion estimated for 2003 • Approx. 300,000 die in US each year due to weight -related illness *U.S. Department of Health and Human Services, “Prevention Makes Common Cents,” Secretary Thompson’s Latest Report to the Nation, September 16, 2003.

8. Healthcare Costs Diabetes (safety story - construction worker) • $13, 243 per person vs. $2,650 per persons without Diabetes • Medical expenditures were more than 2 times greater for those with Diabetes • Diabetes, if untreated or undiagnosed, is a leading cause of blindness, kidney failure, heart disease, and stroke. *U.S. Department of Health and Human Services, “Prevention Makes Common Cents,” Secretary Thompson’s Latest Report to the Nation, September 16, 2003.

9. Healthcare Costs Tobacco Use (safety - lung disease - resp. wearers) • Over $75 billion in direct medical costs • 440,000 deaths each year • Single most preventable cause of death and disease Heart Disease and Stroke (safety story - truck driver) • Estimated$351 billion for 2003 • $209 - Direct & $142 - Indirect • #1 KILLER of men and women

10. The Iceberg Direct & Indirect Costs Direct Costs: • Medical Benefits • Workers’ Compensation • Short-term Disability • Long-term Disability • Absenteeism • Outpatient • Inpatient Indirect Costs: • Overtime • Hiring/Training • Lost Production • Decreased Performance • Decreased Morale • Increased Error & Rework Wellmark, 2003

11. Healthcare Costs & Lost Time Local Estimates 2003 • Severe Cardiovascular Disease (One Heart Attack) • Stress testing = $359 + physician fees • Cardiolite Stress & Rest Scans = approx. $3,000 • Diagnostic Cardiac Catheterization = approx. $6,000 • Cardiac Catheter with Stent = $25,000 or more • Coronary Bypass = $30,000 minimum • Cardiac Rehab = $2,300 for 36 session (12 weeks) • Total Cost of One Heart Attack = over $66,659 • Over $100,000with physician fees and medications • Lost time- 6 days inpatient w/12 week rehabilitation

12. Healthcare Costs & Lost Time Local Estimates 2003 • Preventable Costs - per person per year • Diabetes - complications and treatments can cost well over $100,000 (dialysis for kidney failure = $50,000 per year) • Cancer - radiation therapy costs $12,000 (not including radiologist fees) and includes 6 weeks of treatments, (chemotherapy is thousands to tens of thousands more) • COPD (Chronic Obstructive Pulmonary Disease)- medications$5,000-$10,000 per year + Pulmonary Rehabilitation (permanent maintenance) often leads to permanent disability • Sleep Disorders - can lead to injuries at work & decreased productivity

13. Benefits of Employee WellnessThe Bottom Line Research indicates that comprehensive employee wellness programs can: • Improve employee morale and dedication • Increase productivity • Reduce absenteeism • Improve employee recruitment and retention • Allow greater control over health care costs • Reduce healthcare utilization (injuries & illnesses)

14. Measuring Outcomes Tangible Benefits • Reduced Health Care Utilization - long term (3-5 years) • Reduced Absenteeism due to illness - short & long term HRAs - Self-Reported and/or Company Records • Reduced # and severity of risk factors - short & long term Health Screens - Blood Pressure, Cholesterol, Body Fat etc. * Steelcase Study 1980’s tied reduced risk factors to reduced claim dollars. Intangible Benefits • Increased morale - short & long term • Increased productivity - short & long term • Improved company image - short & long term

15. Case Studies Caterpillar - Healthy Balance Program • projected long-term savings = $700 million by yr. 2015 Motorola • $4:$1 ROI: More then 45,000 employees - disease management, flu vaccinations, cancer and other screenings, smoking cessation & telephonic nurse counseling Northeast Utilities- WellAware Program • Employees & spouses • includes HRA & follow-up initiatives • reduced preventable (lifestyle-related) medical claims by $1.4 million in 24 months *U.S. Department of Health and Human Services, “Prevention Makes Common Cents,” Secretary Thompson’s Latest Report to the Nation, September 16, 2003.

16. Case Studies Bank of America • $5.96/$1 ROI • Target Population - Retirees • Methods - Health Risk Assessments, self-care guide books & other educational materials * Chapman, Larry, “Proof Positive: analysis of the Cost Effectiveness of Worksite Wellness,” Summex Corporation, 1996. Pacific Bell FitWorks • $3.10/$1 ROI: Reduced absenteeism by .8%, saved $2 million in one year; Reduced days spent on short-term disability by an average of 3.3 days, which saved $4.7 million * Blair, Susan, “The FitWorks Savings Story,” Pacific Bell, 1996.

17. Case Studies DuPont • 2 year study • Blue Collar workers at participating sites enjoyed 14% reduction in disability days vs. a 5.8% reduction at sites not participating in the comprehensive wellness program. Net reduction in disability days was 11,726. *Bertera, R. “The effects of Workplace health Promotion on Absenteeism and Employee Costs in a Large Industrial Population”. American Journal of Public Health, September 1990: 1101-1105. Other organizations with positive outcomes: Steelcase, BankOne, Progressive Corp., Xerox, General Motors, Johnson & Johnson, General Mills, Blue Cross/Blue Shield of Indiana

18. Successful Programs Behavior Change Awareness Skill Building Social Support Environmental Support Follow-up/Maintenance Incentives, Evaluation, Modification

19. How to begin... What to include... First Step: Tool for program planning, evaluation & outcomes measurement with Baseline & Follow-up Data • Health Risk Assessment (On-line & On-site) • On-site Health Screenings • One-on-one Follow Up Ongoing: Top-Of-Mind Awareness • On-site & On-line Educational Classes • Self Care Programs Ongoing: Builds Skills & Promotes Action • Fitness, Nutrition & Tobacco Challenges • Weight Management Programs • Walking Programs

20. Genesis Occupational Health WellPower Program Incentives • Points Systems • Three-month Cycles • Monetary vs. Non-Monetary • Seasonal Campaigns • Tie In w/ Benefit Plans (e.g. Discounts on Contributions, Flex Spending Accounts) • Tierd Programs (Offer Variety of Values... Participation vs. Meeting Goals & Changing Behaviors)

21. Things to Consider • Comprehensive Programs (Address all stages of change & levels of awareness) • Confidentiality (Third party aids credibility, builds employee trust & ensures confidentiality of PHI) • On-site Services (Provide optimal convenience & access for better participation) • Follow Up (Entails customized education, referrals & resources to assist & manage high risk individuals)

22. Thank you! Visit www.gohweb.com to learn more!Proudly serving Illinois & Iowa employers for more then 18 years... Amanda HessBusiness DevelopmentGenesis Occupational Health(563) 324-0696 ext. 307hessa@genesishealth.com