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NCHC recommendations for reducing health care spending overlook schedule control as key to adoption of healthier lifestyles

November 9, 2012 Leave a comment

The National Coalition on Health Care has issued its recommendations for bending the relentless rise in health care costs, Curbing Costs Improving Care the Path to an Affordable Health Care Future.  The bulk of the report focuses on treatment and payment reforms with one section devoted to “Prevention and Population Health.”  A key recommendation is sin taxes to deter the consumption of tobacco, alcohol and sweetened beverages.  That’s hardly a prevention and wellness strategy.

Conspicuously absent are meaningful recommendations to give people more control over their lives and schedules so they can spend more time engaging in healthy behaviors like getting adequate exercise and sleep and eating a nutritious diet.  Achieving it will involve nothing short of a transformation of how we conceptualize knowledge and information-based work and when and where it gets done.  We no longer need to commute daily to an office to do it, thanks to the widespread availability of information and communications technology.  Here’s how one blogger described this arguably obsolete work routine:

1 – Wake up earlier than you want to.
2 – Get stuck in traffic on the way to work.
3 – Feel stressed all day at work.
4 – Go home, throw a frozen dinner in the microwave because you’re too tired to cook.
5 – Plop down in front of the TV because you’re too exhausted to do anything else.
6 – Go to bed later than you meant to.
7 – Repeat.

This is a toxic societal lifestyle that over time sets the stage for the development of chronic, preventable conditions that drive much of the health care spend.  A 2011 University of Minnesota study found when people are afforded control over when and where they perform their jobs, they got more sleep and exercise. Bravo. That’s true, low (negligible) cost prevention that can go a long way toward maintaining health and reducing medical utilization and spending.

Time will tell whether PPACA can save individual, small group health insurance market segments

Last week’s Supreme Court decision on the constitutionality of the Patient Protection and Affordable Care Act (PPACA) and specifically the so-called individual mandate turned on the penalty for not having minimum essential coverage under Section 1501 of the PPACA.  While the court ruled the government cannot compel all Americans have health coverage, the government may require payment of a penalty for not having it as a permissible exercise of Congress’s power to levy taxes.  The penalty gives the mandate real teeth.  Without it, the mandate would be a paper tiger.

The individual mandate in turn is designed to work with upfront tax credits to subsidize the cost of coverage for those who earn above 133 percent of the federal poverty level and are thus ineligible for Medicaid.  The penalty for not having coverage is the disincentive or stick and the tax subsidy to defray plan premiums or fees is the incentive — the carrot.  Insurers and health plans also have a mandate to sell coverage to whoever is willing to buy it starting in January 2014 regardless of their medical condition.

Together, the carrot and stick built into the individual mandate along with the requirement insurers and health plans accept all applicants (per sections 2701 and 2704 of the Act) is intended to save the individual and small group health insurance market segments from the black hole of adverse selection and ultimately market failure.  The acceleration in adverse selection in recent years occurred in the individual market due to increasingly selective medical underwriting standards in states where payers are permitted to screen out people likely to incur high medical treatment costs. Adverse selection also threatens the viability of the small group market due to poor spread of risk among employers of 50 or fewer employees— and particularly numerous micro businesses with five or fewer workers.

In order to preserve these market segments and to also reduce rising premiums in the large group market due to the shifting of medical treatment costs incurred by those without coverage to the insured population, the PPACA has created an alternative and far more compulsory health insurance market than existed prior to its enactment in early 2010Daniel Weintraub, a veteran Sacramento print journalist with deep knowledge of the health care market, described the new market landscape that will fully emerge in 2014 as one in which insurers and managed care plans will effectively become a “quasi-public utility.”

The question going forward is whether this government-drawn and enforced market can achieve sufficient savings and spread of risk to ward off market failure in the individual and small group market segments.  In addition, given that health insurance functions as a pass through mechanism, whether the chronic disease prevention provisions of Title IV of the PPACA will meaningfully slow the relentless rise in medical costs driving up premiums.

Group health insurance premiums up 50 percent from 2003 to 2010

November 19, 2011 Leave a comment

Premiums for employer-provided health insurance rose by 50 percent from 2003 to 2010 as employers passed on high costs to workers, boosting their annual share of premi­ums by 63 percent over the seven-year period, according to a report issued this week by The Commonwealth Fund.  That’s much faster than overall inflation and wage growth during the period.  The numbers reflect an affordability crisis confronting health insurers given the rate of growth of premiums is taxing the ability of employers and individuals to pay them at the same time the nation struggles to regain economic growth.

The report looks to a combination of insurance market reforms, payment incentives and delivery system changes to potentially reduce insurance costs by an average of 1 to 1.5 percent­age points per year over the next decade.  But even with the higher savings figure, coverage would remain costly, putting the average national family premium at $16,912 in 2015 and $20,620 by 2020, the report estimates.

While not specifically called out in The Commonwealth Fund report, the premium increase data underscore the enormous social cost of the poor health habits of many Americans — unhealthy diet and lack of adequate exercise and sleep — that underlie chronic conditions such as heart disease and diabetes that in turn drive up medical costs.  Insurance market reforms alone can’t address those factors that according to the Preventative Medicine Research Institute account for 75 percent of health care costs that can be prevented by lifestyle changes.

Telework’s potential as employee wellness program component

November 8, 2010 Leave a comment

This article makes a point also made on this blog: that increasing access to health care fails to address the root cause of increased health care utilization and particularly lifestyles that lead to preventable chronic conditions that are a major driver of that utilization.

Employers are becoming increasingly sensitive to the rising cost of health care, driving interest in prevention and wellness programs designed to reinforce healthy behaviors such as exercise.  Some are paying workers rewards to take good care of themselves and even strapping pedometers on them.

But will these measures have a meaningful, long-term impact on getting rising health care costs under control?  I’m doubtful because I view this not so much as a workplace issue but more of a work-life time management issue, particularly for office/information workers.  If they are commuting to an office five days a week there’s often not much time or energy in the workday for a significant and beneficial amount of exercise and the seven to eight hours of sleep many medical experts say people aren’t getting but should.  Sitting in a commute and then sitting in a cubicle for eight or more hours does not a healthy lifestyle make.  Just look at the many supersized workers who inhabit this work environment.

One employee wellness intervention that employers of this large category of workers should consider implementing to get measurable results is allowing them to work from their homes or from locales close to their homes for some or most of the workweek.  The freed up commute time can then be used for an hour of exercise based on the average U.S. commute time.  There’s also the added plus of more sleep time since teleworkers can start work soon after rising without having to prepare for a trip to the office.

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