Comments on: Wellness program pay-off: How long is too long to wait? http://www.hrbenefitsalert.com/how-long-should-you-wait-for-a-wellness-program-to-work/ Daily dose of benefits news and know-how Sat, 18 Jun 2011 21:36:33 +0000 hourly 1 http://wordpress.org/?v=abc By: Jack http://www.hrbenefitsalert.com/how-long-should-you-wait-for-a-wellness-program-to-work/comment-page-1/#comment-3055 Jack Sat, 21 Feb 2009 13:46:44 +0000 http://www.hrbenefitsalert.com/?p=606#comment-3055 Does anyone have an actual causality study? Most of the ROI calculations are estimates where average claims and absence expense information is used to estimate the financial impact on a change in behavior. Similarly, even where companies show reductions in medical spend, or reductions in the rate of increase, I've seen where those changes were more a function of the sentinel effect (from introducing a H&P/Wellness program) or from benefit design changes introduced concurrent with the H&P/Wellness program. So, who has the proof? Who has a health plan vendor, insured or self-insured, who has guaranteed reductions in health claims/absence experience? Or, comparably, who has the health actuary who has reduced FAS 106 expense as a result of applying a H&P/Wellness program to retirees or older associates? I (plan actuaries) can document the impact of a change in copayments, deductibles, etc. and I can estimate the impact on utilization as well. Have yet to see study that confirms true causality. Does anyone have an actual causality study? Most of the ROI calculations are estimates where average claims and absence expense information is used to estimate the financial impact on a change in behavior. Similarly, even where companies show reductions in medical spend, or reductions in the rate of increase, I’ve seen where those changes were more a function of the sentinel effect (from introducing a H&P/Wellness program) or from benefit design changes introduced concurrent with the H&P/Wellness program.

So, who has the proof? Who has a health plan vendor, insured or self-insured, who has guaranteed reductions in health claims/absence experience? Or, comparably, who has the health actuary who has reduced FAS 106 expense as a result of applying a H&P/Wellness program to retirees or older associates?

I (plan actuaries) can document the impact of a change in copayments, deductibles, etc. and I can estimate the impact on utilization as well. Have yet to see study that confirms true causality.

]]> By: Michael Puck, SPHR http://www.hrbenefitsalert.com/how-long-should-you-wait-for-a-wellness-program-to-work/comment-page-1/#comment-2361 Michael Puck, SPHR Thu, 05 Feb 2009 21:09:06 +0000 http://www.hrbenefitsalert.com/?p=606#comment-2361 I certainly can confirm based on my research that it takes the vast majority of companies with wellness programs 18 months or more before they can demonstrate a positive ROI. In many cases it is three to four years. At the same time there are companies that have been able to demonstrate a positive ROI after as little as 6 months from program initiation. One particular company I like to reference is investing over $25 per employee per month to support a comprehensive health and productivity improvement program. The program delivered a 5:1 return on investment after just 12 months. In my opinion an impressive result for a mid-size manufacturing company with 400 employees. Furthermore, I would like to suggest that there are other (more) critical measurements that indicate program effectiveness than bottom line ROI, especially over the first 12 – 24 months after program initiation. One of those numbers is the change in health risks factors among the insured population. I certainly can confirm based on my research that it takes the vast majority of companies with wellness programs 18 months or more before they can demonstrate a positive ROI. In many cases it is three to four years. At the same time there are companies that have been able to demonstrate a positive ROI after as little as 6 months from program initiation. One particular company I like to reference is investing over $25 per employee per month to support a comprehensive health and productivity improvement program. The program delivered a 5:1 return on investment after just 12 months. In my opinion an impressive result for a mid-size manufacturing company with 400 employees. Furthermore, I would like to suggest that there are other (more) critical measurements that indicate program effectiveness than bottom line ROI, especially over the first 12 – 24 months after program initiation. One of those numbers is the change in health risks factors among the insured population.

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