Modest Improvement in Individuals' Health Risks Could Save Billions

A 25 percent improvement in the health risks of Americans would yield savings of up to $945 billion over the next 10 years, according to a report.

Based on the actual five-year (2003-07) health care experience of more than 4.2 million commercially insured individuals, researchers from Ingenix Consulting and the Center for Health Research at Healthways calculated the estimated cost of health care from birth to age 64, and the predicted impact from risk-reduction scenarios that represent reduction in the onset or progression of disease-related morbidity. The report found that health care costs for people born in 2008 will average $243,000 per individual by age 65 (2008 dollars). Researchers said preventing an increased level of health risk in only 10 percent of individuals, beginning at age 25, would generate average health care cost savings of $180 for each individual for each year through age 64 across the entire study population. The savings were estimated to reach $470 per individual annually if 25 percent of individuals did not increase in risk from age 25. This would represent a savings of approximately $945 billion over 10 years if applied to the current number of commercially insured population in the U.S., the study concluded.

Wellness programs key. Researchers said the findings provide support for wellness and prevention initiatives and emphasize the importance of such programs that some employers are already providing as a means to achieve meaningful cost reductions by improving employee health. Ben Leedle Jr., CEO of Healthways, pointed to wellness and prevention programs that have been put into place at Lincoln Industries, a Lincoln, Neb.-based supplier of products requiring high-performance metal finishing. The company has provided wellness initiatives to its employees and their dependents since 1977, which has resulted in 40 percent lower health care costs than other comparable firms in the region. Lincoln Industries has also lowered turnover and reduced absenteeism since the implementation of the programs.

CWCI: Medical provider networks effective, but reforms raise questions (04/08/13)
WC systems increasingly eye treatment guidelines (12/10/12)
State considers treatment guidelines through rule change (12/10/12)
Executive Summit speakers weigh in on comp challenges, solutions (11/03/11)
CMS proposal could add layer of complexity to comp cases (08/02/12)

"As demonstrated by Lincoln Industries, savings over time of the magnitude identified in the CHR report are well within the range of what can be accomplished through comprehensive, integrated well-being improvement initiatives that enhance individual and organizational performance," Leedle said. "These initiatives would include such elements as workplace wellness programs, well-being assessments, and fitness, nutrition and smoking cessation programs, chronic care management, and support for emotional and social health."

Read more at the WorkersComp Forum homepage.

August 23, 2010

Newsletter Sign-up