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Hospitals, local employers: Partners in reducing costs

Posted Sep 08 2011 9:28am

by Pat Cavanaugh

Hospitals have many goals and wants in these challenging times. Among them, they want to gain market share, they want to increase profitability, and they want to be positioned as the leading healthcare resource in their community. At the same time, local employers are not without their own list of "wants." They to want to control rising healthcare costs, they want to increase the health of their workforce (and thus lessen absenteeism and skyrocketing insurance premiums), and they want to be known for treating their employees fairly and with respect.

The wants of these two groups are not mutually exclusive. Quite the contrary. As Mercy Medical Center and other forward-thinking hospitals around the country have come to realize, all the wants of both parties can be met by creating trusting partnerships between the hospital and local employers built around the goal of creating a healthier workforce. We've done it at Mercy Medical Center and are better off as a result.

Here's how we did it:

Working in partnership with Nashville-based Aegis Health Group, we first identified appropriate employers in our catchment area with a desirable reimbursement profile. We approached these employers and offered to provide them with a program that has very little (or no) cost to them, but delivers high value for the company and its workforce. The receptivity of employers to such an idea was outstanding.

With employers on board, we began the program by administering a health risk survey to employees (and, in some cases, spouses and insured family members). The survey helped identify overall health risks, trends, and current utilization of health services. Through Aegis, we produced "Personal Health Profiles" that were confidentially provided to each employee. At the same time we shared aggregated, de-identified results with each employer so they understood the potential costs of doing nothing. Many employers told us that simply understanding the reasons for rising healthcare costs was an "eye-opener" and something no one has had the time or technology to do before now.

With such data in hand, the program really kicked into gear as we worked with each employer to develop health and wellness programs that directly matched the needs of their workforce. Here, we also engaged our medical staff by inviting them to visit the worksites to conduct lectures and screenings focused on tobacco use, high blood pressure, obesity, and other lifestyle issues. At one employer we tested employees for certain metabolic symptoms/conditions, such as high cholesterol. By doing all of this in a coordinated manner, we were able to position Mercy as a trusted ally of the employer and their employees.

Some employers really got on board in a big way. Mainstream Living (a nonprofit organization that assists individuals with disabilities), for example, required employees with three or more high risk factors to attend classes conducted by Mercy and also offered employees a reduction of their annual health insurance premiums as a result of participation. The program, now in its third year, has paid off. Mainstream's insurance premium trend has dropped from about a 10 percent increase per year in 2007 to 4 percent, and employees have had fewer hospitalizations and office visits, a return on investment Mainstream did not expect so quickly.

Implementing programs such as these succeed because everyone wins. Hospitals win by driving desirable patient volume into their facilities (and medical staffs) and establishing themselves as the provider of choice in the community. (This program also has allowed us to strategically target our marketing and business development dollars in ways that have the highest quantifiable return on investment.)

Employers win because by working with the local hospital they are able to identify employee health risks and implement early detection initiatives that ultimately save them dollars in insurance premiums, absenteeism and worker's compensation claims. And, employees win by learning more about their health risks and gaining the knowledge and tools they need to lead a healthier lifestyle.

Perhaps most importantly, this program has allowed us to position Mercy Medical Center as part of the solution, rather than part of the problem, of rising healthcare costs. And in today's healthcare world, that's a great place to be.

Pat Cavanaugh, is the director of cardiac prevention at Mercy Medical Center in Des Moines, Iowa, and oversees the hospital's workforce health initiative.

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