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NUMBERS CAN sometimes speak louder than words, and when it comes to health care costs borne by employers, they can be frightening.
King County, with 13,000 employees, got its own fright when it looked at its numbers. In 2005, the county's health care costs were $107 million. By 2009, costs were projected to soar to $176 million. Something had to be done to rein in those costs.
The county took the unprecedented step of opening its books to union members and calling for their support. In concert with the unions, the county pieced together a new health program that it hopes will save $40 million over the next three years through telephone outreach, health risk assessments and behavior changes, leading to reductions in co-payments and benefit access fees. The program also will provide ongoing support and education to members with such chronic conditions as diabetes.
King County is one of many organizations that have taken up "wellness" programs in an effort to cut health care costs. According to the Society for Human Resource Management, 62 percent of employers now offer a wellness program, and another six-percent plan to implement one. But, like King County, many organizations are getting the support of unions so they can become more aggressive in pushing employees to take responsibility for their health care.
The moves come amid soaring health care costs across the nation. The nation's total health care bill will come to $2.16 trillion this year, up from $1.4 trillion in 2001, according to The National Business Group on Health. Of the total, $745 billion is derived from private insurance payments, which are mostly picked up by businesses. The average cost per working American comes to $8,748, of which businesses are paying $6,852.
"It's a train wreck," says Robert Carpenter, vice president of wellness at ComPsych Corp., a Chicago company that provides businesses with a variety of employee assistance programs, including work-life and wellness services. "So companies are asking, When do we reach a point where we are no longer profitable, based on the increase in health care costs?"
To stem the bleeding, many organizations today are going to unprecedented lengths to get employees to commit to their own health by offering in-depth wellness programs and other health initiatives. These programs began sprouting up in the early 1990s. They usually offered some form of health-related newsletter and perhaps a discounted gym membership or nutritional guidance class. Employees didn't always choose to participate. That's now changing. The programs of today are far more comprehensive. They include a host of medical screenings: blood pressure, cholesterol, cancer and mammogram, as well as a variety of online health risk assessments, seminars and even on-site medical clinics. And employees are pressured to take part.
PARTNER WITH THE UNIONS
With wellness programs becoming more personalized, and potentially intrusive, labor unions are being brought into the equation. King County, for example, negotiated for a year with 95 bargaining units to make sure its employees bought into the program.
"Labor has been key to the success of Healthy Incentives," says Brooke Bascom, communications director for the Health Reform Initiative. "[King County Executive] Ron Sims went to the unions and said, 'Our situation is dire.' He laid out the financial situation, and the numbers made sense to labor. They realized changes had to be made."
King County was able to achieve this unparalleled partnership in large part through the Joint Labor Management Insurance Committee, which was designed to represent 25 labor unions in negotiating employee benefit packages. "We got a seat at the table and saw the data firsthand," says Dustin Frederick, business manager of the Public Safety Employees union. "We were shown the facts and asked, 'What do we do about it?' It created a trust factor and opened our eyes to health care costs."