Healthcare & Wellness Market Survey

William Gallagher Associates recently conducted a market research survey within its client base for opinions on the various ways to reduce health insurance costs, with a focus on wellness. In recent years, employers have increasingly introduced wellness programs to address rising health insurance costs. Numerous studies have shown a direct link between avoidable, preventable risks such as obesity, high cholesterol, high blood pressure, heart disease and smoking and higher health care costs and lost days. The concept of wellness, however, is very broad and relatively new to employers.

This market survey was conducted in conjunction with David Paleologos of DAPA Research, Inc. David is a professional pollster and serves as the Director of the Suffolk University Political Research Center. The 28-question survey was sent to over 1100 primary insurance buyers, including Human Resources professionals and C-level executives. The questions were in four areas: Current benefits practices, Personal opinions on wellness, Healthcare programs, Opinions on public policy.

Demographics The 2011 WGA survey was fielded in Boston, Massachusetts, which is the corporate headquarters of WGA.

63%

respondents were Human Resources professionals or Benefits Administrators

27% were in a Finance or Accounting Role

60%

13% were in a General Counsel Role 4% were in some other role in the company

represented were female and 40% were male, consistent with market data.

Age of responders

20-29 4% 60-69

12%

30-39

15%

50-59

31% 40-49

37%

Industry Breakdown 25% High Technology

7%

Financial Institutions

2%

Public Entity

24 % Biotechnology

6%

Healthcare

2%

Venture Capital/Private Equity

18% Other

6%

Manufacturing

1%

Aviation

10% Non-Profit

2%

Real Estate

Location of responses

1

2 1

84

6

3 2

3

7 1

4

1

1 1 1

Wellness Initiatives Health Risk Assessments Health Risk Assessments are one of the most widely used screening tools in the field of wellness and health promotion. These tests are often the first step in a multi-component program to promote healthy living amongst employees. They usually consist of an extended questionnaire, a risk calculation or score, and some feedback with a health advisor or online report. Survey results found that half have either a Health Risk Assessment program currently in use (18%), were planning to implement within the next 12 months (6%), or have hopes to implement one in the future (26%).

18%

Currently in Use

Hope to Implement at some other time in the Future

50%

26% 6%

Plan to Implement in the Next 12 Months

No Plans to Implement

Company Approach Of the companies that have implemented Health Risk Assessments, 48% are opting for positive reinforcement like cash incentives/gift cards and recognition programs rather than penalties for failure to reach health benchmark goals (failing to quit smoking, reduce BMI). How do you encourage participation in wellness initiatives (HRA completion, physicals and screenings, program participation, etc.)? Cash incentives

Gift cards

35%

26%

Health plan contribution differential, such as a 10% discount on payroll deductions for participation Eligibility for more generous health plans

24% 3%

6% 6%

Extra Health Reimbursement or Health Savings Account contributions from the company Recognition program (awards, prizes, etc.)

Biometric Screenings Biometric Screenings are evaluations intended to identify potential medical problems. Some biometric tests include blood pressure, cholesterol levels, even nutritional analysis of employees. Survey response showed that 35% were either currently using this screening process (11%), planning to implement it within the next 12 months (8%), or hope to implement it in the future (17%).

11% Currently in Use

16%

65%

Hope to Implement at some other time in the Future Plan to Implement in the Next 12 Months

8% No Plans to Implement

If Biometric Screening and/or Health Risk Assessments are is currently in use, what percentage of employees participate:

14%

Up to 25% employee participation - 72%

14% 26% to 50% employee participation - 14%

72% 51% to 75% employee participation - 14%

Anti-Tobacco Use Programs 8% 8% - Currently in Use

61%

25%

25% - Hope to Implement at some other time in the Future

6% - Plan to Implement in the Next 12 Months

6% 61% - No Plans to Implement

Weight Loss Programs

16% - Currently in Use

16%

24% - Hope to Implement at some other time in the Future

55%

24% 5% - Plan to Implement in the Next 12 Months

5%

55% - No Plans to Implement Note: Many health plans offer such programs with their plan

Discounted / Free Healthy Foods in Company Kitchen

17%

17% - Currently in Use 11% - Hope to Implement at some other time in the Future

11%

70%

2% - Plan to Implement in the Next 12 Months

2% 70% - No Plans to Implement

Healthcare Provider Questions Increase Categories of Family Status (from beyond the traditional Single, Single plus One, Family categories):

Currently in Use

20%

Hope to Implement at some other time in the Future

10%

67%

Plan to Implement in the Next 12 Months

3% No Plans to Implement

Penalties (or lost discounts) for employees whose spouses have the availability of coverage elsewhere but enroll spouses in your plan, or a working spouse contribution (i.e. if an employee covers their spouse and that spouse has health insurance from their own employer, the employee will pay more to cover that spouse.)

17%

2%

Hope to Implement at some other time in the Future

Plan to Implement in the Next 12 Months

81% No Plans to Implement

Penalties (or lost discounts) for Failure to Quit Smoking after Coaching/Classes

14%

3% Hope to Implement at some other time in the Future

Plan to Implement in the Next 12 Months

83% No Plans to Implement

Asked about penalties (or lost discounts) for Failure to Reduce Body Mass Index or other weight objectives after Coaching/Classes.

16% No Plans to Implement Hope to Implement at some other time in the Future

84%

Offer a variable premium contributions based on years of service at your company 3% 7% Hope to Implement at some other time in the Future

14%

Currently in Use

No Plans to Implement

76%

Not Sure

Variable premium contributions based on salary categories

9% Not sure

7% 9%

75%

Hope to Implement at some other time in the Future

Currently in Use

No Plans to Implement

Tiered Network Plan Design Where the provider network is divided into two or three "tiers" based on cost and quality. The patient's benefits are based on which tier the provider is a part of, and patients impact what the plan pays at the point of service.

Not sure

19%

Hope to Implement at some other time in the Future

57%

Plan to Implement in the Next 12 Months

14%

Currently in Use No Plans to Implement

8%

2%

In-House Physician Assistants/Doctors on Premises Do you operate an on-site medical facility or have employed health care providers (nurse, physician assistant, etc.) at any of your locations?

2%

1%

1% Currently in Use

Plan to Implement in the Next 12 Months

Hope to Implement at some other time in the Future

96%

No Plans to Implement

Do you operate an on-site health club/fitness facility for the benefit of employees at any of your locations?

15%

3%

Yes

Planning to open within next 12 months

82%

No

Policy Opinions Although the corporate world is in a vigorous anti-tax mindset due to a faltering economy and high unemployment rate, a full 30% of respondents would support an added tax on sugar sweetened beverages in order to reduce obesity in society. This could take the form of a 10 or even 25 cent per can fee or an upward adjustment to the state sales tax rate. Respondents were torn on the question of whether the government should ban advertising of “unhealthy foods” on programs aimed at children in order to reduce obesity in the population. Forty-four percent opposed the ban while 39% supported it and 17% were undecided. This finding was well within the margin of error and could eventually win public support through a targeted campaign.

30%

would support an added tax on sugar sweetened beverages

39%

would support an advertising ban of “unhealthy foods”

Should States Tax Sugar-Sweetened Beverages in order to reduce Obesity in Society

6%

No Tax

12% No Opinion

48%

12%

22%

Charge 25 Cents Per Can

Charge Current Overall State Sales Tax Rate

Charge 10 Cents Per Can

Should Government Ban Advertising of "Unhealthy Foods" on programs aimed at children in order to reduce Obesity in the population?

17% No

44%

Yes

39%

I have no opinion No Opinion

Should Providers (Hospitals) be allowed to Offer Fixed Cost Health Benefits Directly to Insurance Buyers like your company without an Insurance Company as an Intermediary?

Yes

44%

41%

No Opinion I No have no opinion

15%

Do you think the current Reimbursement System works? 3%

It is broken

22% It is adequate for the job

50% Opinion INo have no opinion

25%

It works

Some advocates and government officials want to change how health care providers are paid from the current fee-forservice system. In this vision, providers would be paid a fixed amount (a budget) based on the number of patients that select them. If the provider meets certain quality measures, they would also receive a bonus for delivery good care. Should the government force the adoption of this reimbursement system?

29%

27%

Yes No INo have no opinion opinion

44%

Summary This survey has just begun to scratch the surface of potential wellness initiatives; it serves as an important first look into the mindset of the business community. Research points to the vast majority of companies have not yet considered the importance of wellness programs, be it weight loss, anti-tobacco use, biometric screenings, discounted healthy foods, or even basic health risk assessment programs. But we have learned that those companies that do have the vision and resources to invest in better employee well-being hope to see the benefits in the long-term. We have also learned that the few companies who have these programs have offered cash rewards and other positive incentives to drive results. At this point, companies are rejecting the use of penalties or withholding of benefits at this point, but we may wish to explore in further research that alternative strategy to gage effectiveness. Based on this survey, there is opposition to major policy changes like taxing sugar sweetened beverages and banning advertising of unhealthy food on children’s programs. Furthermore, the “oppose” margins in both questions are not overwhelming, given the margin of error, which suggests an opportunity for opinion leaders and policymakers. Third and finally, we must consider that some apolitical entity must take the lead on this issue. The government and the general public are scrambling within the short-term immediacy of economic survival: paying bills, balancing budgets, and getting/keeping a job. Forward thinking entities - businesses - have an enormous opportunity to take a leadership position (with the support of government and the public) to make a difference on this critical issue. For more information on implementing a wellness program please contact WGA at [email protected].

Details of Survey 1.

This Northeast Wellness Study was executed in the field from July 7th to August 11th inclusive.

2.

The survey included 119 completed interviews with corporate decision-making/human resources personnel from a sample pool of 1191 existing clients. Seventy percent of respondents were from Massachusetts companies and 23% were from the remaining Northeast and Mid-Atlantic states. Just 7% of responses came from other states within the South and West region.

3.

Each interview timed out at approximately twelve minutes to complete.

4.

There is a 95% confidence level that the margin of error is within +/- 9% given the universe of respondents.

5.

The survey included 28 pre-coded close-ended questions.

6.

All surveys were conducted online using an e-mail blast to current clients accompanied by a link to the survey platform.

7.

The list of companies is a client list of human resources contacts and the property of WGA.

8.

The 119 respondents represented 119 different companies. There were no duplicate responses or IP addresses within the same company.

9.

All respondents were simultaneously e-mailed an advisory prior to the survey field execution. The advisory provided instructions and urged respondents to participate and self-select through the menu of screen questions and options.

10. This study is the property of WGA and its affiliate membership. No other individual, agency, company, media outlet, or institution may reproduce the following study, either in whole or in part, without the expressed written consent of WGA.

William Gallagher Associates is a leading provider of insurance brokerage, risk management and employee benefits services to firms with complex risks, within industries that include technology, life sciences, financial risks, health care, renewable energy and clean tech and environmental services.

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