Oregon adopts health engagement model for its state employees, as evidence of cost savings grows

Across the nation, pathologists and clinical laboratory managers will want to learn about a new model of healthcare reform. It is the “health engagement model” (HEM) and it is being rolled out by a number of health insurers.

Variations of the HEM model are gaining ground in states around the country because health insurers see HEMs as a way to reduce costs and improve quality of healthcare. One new HEM is taking root in the Pacific Northwest. The Oregon Public Employees’ Benefit Board (PEBB) recently adopted a new HEM for state employees, according to a story published by the Lund Report.

What may cause some medical laboratory managers to sit up and take notice is the fact that PEBB’s HEM is producing impressive participation numbers. “Thus far, 48% of members have enrolled for health plans,” stated Ingrid Norberg, Communications Coordinator at PEBB. “And 87% of participating members chose to participate in the health engagement model.”

The consumer health engagement model is a health promotion program that typically involves several activities

The consumer health engagement model is a health promotion program that typically involves several activities.

Across the nation, state public employee health benefit programs are struggling to manage cost growth and improve quality. To achieve meaningful outcomes, these benefit programs must focus their management strategies on changing both the performance of the delivery system and the health behaviors of the covered population. That was the finding of a report published last year by the Robert Wood Johnson Foundation (RWJF).

According to this report, research indicates that consumer engagement strategies reduce medical costs by approximately $3.27 for every dollar spent. Additionally, such programs cut absenteeism costs by approximately $2.73 for every dollar spent.

The consumer health engagement model is a health promotion program that typically involves several activities. Among them are:

  • completion of a health risk assessment (HRA);
  • financial and non-financial incentives;
  • obligation of the participant who has risk factors, to take active steps to try to reduce those personal risk factors; and,
  • wellness promotions and support programs.

Trends in Consumer Engagement Models

The RWJF report detailed several financial characteristics of HEMs:

  • Financial incentives to the individual for completing an HRA, such as lower co-payments or lower premiums;
  • Differentiating premium levels to the individual, based on his or her compliance with requirements to complete an HRA and follow-up steps;
  • Differential rates to the individual based on his or her health status. An example is lower premiums for self-reported non-use of tobacco; and,
  • Supporting services that focus on continuous engagement to effect permanent lifestyle changes.

Some union members have expressed concerns about privacy, government overreaching and possible discrimination. “I can’t think of an issue that has generated so much member outrage,” stated Linda Burgin, President of SEIU Local 503, in the Lund story.

But according to plan administrators and public employee unions in other states with similar programs, this is just a natural reaction in the beginning. There is mounting evidence that not only are participants satisfied with such programs, but the new HEM strategies are saving millions of dollars.

The Illinois program that PEBB used as a model is an example. “There was some concern expressed in the start-up phase,” stated Hank Scheff, Administrator and Employee Benefits Director for the Illinois chapter of the American Federation of State and Municipal Employees (AFSCME). The union assured members that the information would be kept strictly confidential.

During its first year, the Illinois program attracted 93% of the union’s 400 employees.

Statistics Show That HEMs Slow Cost Increases

Minnesota operates a program that offers cash discounts on premiums for completing an HRA. It has a 70% HRA completion rate. Washington offers gift cards for HRA completion and has a completion rate among employees of 25%. Arkansas, Alabama, and West Virginia also have their own versions of the HEM concept.

In 2009, Alabama began tying premium discounts to HRA completion. Alabama saw an increase from 8,000 HRAs completed in 2008 to nearly 36,000 through November 2009. This represents a participation rate exceeding 95%.

The key to successful worksite health promotion programs is evidence-based design and delivery, stated a report by Emory University’s Institute for Advanced Policy Solutions.

Successful programs are science-based. HRAs are only one component, the report noted. Effectiveness is also greatly enhanced when the organization’s HEM has the full support of senior management. Also, incentives boost participation. Programs need to be in place at least one year to reduce employee risks, the report stated, and HEMs require at least three years to measure health and financial outcomes.

Clinical laboratory managers and pathologists can take the health engagement model as an example of how health insurance plans and health benefits programs are moving patients toward proactive care. It is also an important demonstration of how these organizations will increasingly educate consumers to seek high value healthcare services.

—Pamela Scherer McLeod

Related Information:

Value-Based Purchasing and Consumer Engagement Strategies in State Employee Health Plans: A Purchaser Guide

Despite Union Resistance, Health Engagement Model Gets Under Way in Oregon

Design Matters: Worksite Health Promotion ROI Closely Linked to Evidence-Based Programming

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