Building Market Share via an Employer Worksite Wellness Program
By Ford Titus & Henry Ross
At a Glance
Results: ProHealth Care developed a comprehensive worksite wellness program to employers—and saw net revenues increase by nearly $1.5 million in the first 21 months of the initiative and another $1.3 million in the following 12 months. Now in its fifth year, the program serves 97 employers, representing nearly 20,000 lives.
Key success tips:
Key success steps included:
* Adopting a tested method for reducing employers’ healthcare expenditures
* Piloting the program within our own health system
* Proactively preparing for increase in inpatient utilization
* Staffing the program with the right champion
* Continually communicating the value of workforce wellness to employers and employees
* Conducting a rigorous ROI analysis
Like many health systems, Waukesha, Wis.-based ProHealth Care operated an occupational medicine program for injured and ill employees in a clinic setting. The program also sponsored onsite health fairs and occasional screenings at the request of employers.
While the occupational medicine program was our system’s primary means of interfacing with local employers, it did not proactively extend to our locally owned, not-for-profit system’s mission of promoting wellness and creating a healthier community. We wanted to broaden our message to employers that we have the ability and expertise to address their total health needs—not just limited to occupational health. ProHealth Care has a long history of community involvement and is one of only five U.S. health systems to receive a 2009 VHA Leadership Award for Community Benefit Excellence.
Hospital leaders began to look for new options that would add additional value to existing employer relationships while operationalizing wellness. The team charged with developing a recommendation included the presidents of two hospitals, the medical director, the senior vice president of administration, and the vice presidents of finance and marketing.
The consensus was that we needed to take our existing wellness program and employer relationships to the next level—and build a comprehensive employer health management program. We wanted to create the kind of consultative expertise that would allow us to help employers reduce their overall healthcare expenditures, while improving the health of their workforces.
Four years after launching the program—called ProHealth Works—our system’s overall market share has increased by 2.8 percent. While this increase is the result of many factors, ProHealth Works and the positive local market visibility it brings to our system has clearly contributed.
How the Program Works
We operate ProHealth Works with a partner that specializes in hospital growth strategies focused on employer relationships. The program is modeled as follows:
> The program proactively engages local employers in workforce health management programs.
> Employees at each worksite are encouraged to complete a confidential personal health profile and take part in biometric screenings, including blood glucose, full lipid panel, blood pressure, as well as height and weight to determine body mass index. > Specific health recommendations are created for all participating employees, based on their unique health risks.
> The employer receives an aggregated, de-identified workplace profile, which identifies overall worksite health trends (e.g., high incidence of back injuries, obesity, smoking), provides a picture of what is contributing to the employer’s healthcare costs, and offers countermeasures. (In accordance with HIPAA regulations, only employees receive their personalized health reports.)
> Employers are offered custom-designed, on-site programs and interventions (e.g., smoking cessation classes, blood glucose screenings) aimed at mitigating common worksite health problems.
The cost to employers is $40 for each completed personal health profile and baseline biometric screening, which covers ProHealth Care’s costs. Based on the results of these reports, we offer the appropriate onsite programs at a nominal charge per participating employee. Through ProHealth Works, employers also have access to a variety of educational presentations led by ProHealth physicians. The first four are free for each employer, after which they cost $100 per hour.
The concept of personal health profiles is not new, and many health plans attempt to capture this data on their members. But hospitals that defer this enterprise to health plans are missing a major opportunity. It is the local, trusted hospital—which has been established and known for years and is there to stay—that should be nurturing this bond with the local employer community. To do otherwise is to concede an important business development enterprise and the platform to further position the hospital as the “go-to” partner of choice for employers and employees alike.
By identifying opportunities for improving employee wellness, ProHealth Works links specific workers with specific programs within our health system. Drawing from data gathered in the personal health profiles each employee completes, we can target the right programs to the right employees. This helps drive appropriate use of healthcare services, builds business for the system’s medical staff (thus furthering physician bonds), and creates opportunities for cross-selling health system programs.
Building the Program
ProHealth Care spent six months developing the ProHealth Works initiative. The director of occupational medicine services led the program’s development, which required buy-in from multiple internal stakeholders and service lines.
Meeting projected demand. Activity generated by ProHealth Works was projected to increase patient utilization across the continuum, including emergency department (ED), outpatient programming, cardiovascular care, orthopedics, neurosciences, community education, and women’s care. The finance department identified the projections, which serve as benchmarks for each service line director. ProHealth Works then assists the directors in meeting these goals.
Service lines worked closely together to create a means of providing new educational and screening programs. For instance, there needed to be a way to fulfill requests for biometric screenings at employer sites, and designate health system personnel to conduct seminars and staff health fairs. Departmental leaders worked together on setting up a process to fulfill specific employer requests, all of which was achieved without additional clinical staff.
Staffing the program. A new position was created: the employer relations specialist. This staff member is responsible for creating targeted employer lists, serving as the liaison with each employer contact—typically a human resources contact—and promoting the concept of health management to local employers. The staff person also coordinates the administration of onsite personal health profiles at each worksite, schedules screenings and educational presentations led by ProHealth physicians, and conducts ongoing analysis of utilization generated by ProHealth Works.
ProHealth leads in program adoption. In the spirit of our dedication to wellness, system leadership decided to be the first employer to engage its employees. Of our 5,000 employees, 3,800 completed personal health profiles in 2005. This high level of compliance served as a useful example to other employers.
Targeting employers. We initially targeted businesses that were current occupational medicine clients. In addition, employer lists were purchased and used to create prospect lists of the area’s most desirable employer partners based on numbers of employees, insurance profile, type of industry, etc.
ProHealth Care established revenue baselines for its existing occupational medicine clients prior to launching ProHealth Works. This allowed usto perform an accurate ROI analysis.
ROI Calculation Using Control Group: Most Recently Measured 12-Month Period
Determine increase in net revenues for employer group and control group.
Base period net revenues
($ in millions)*
Test period net revenues
Control group: Patients that work for employers not involved in ProHealth Works
Employer Group: Patients from employers participating ProHealth Works
* Base period = November 2004 to October 2005; Test period = August 2007 to July 2008. ProHealth Works commenced November 2005.
Apply control group percentage increase to employer group to determine expected result:
$7,024,969 Employer group base period net revenues
x 11.04% Control group percentage increase
$7,800,575 Expected result for employer group
This is the amount of growth in net revenues that the hospital would expect in the absence of the worksite health initiative.
Subtract the expected result from the employer group’s actual result and apply expenses associated with the program to determine the ROI:
Actual revenues from employer group for test period
Expected result based on control group’s performance
Additional revenue generated by ProHealth Works initiative
To do this, we established a “control group” comprised of employers not participating in ProHealth Works. We then derived the growth rate for this control group from the year preceding implementation of ProHealth Works to each subsequent period of participation. The assumption was then made that this growth rate, or expected result, is what would have occurred with existing clients had they not become a part of the ProHealth Works program. The expected result then became the basis for comparison against the actual volume generated by employers participating in the program.
ProHealth Works commenced in November 2005, so we chose November 2004 through October 2005 as the base period. An analysis for August 2007 through July 2008 revealed that ProHealth Care experienced an increase in net revenues of more than $1.3 million attributable to ProHealth Works clients over the 12-month period.
When contrasted with expenses during the corresponding time period, ProHealth Care realized an ROI of 6.58 to 1. Revenue from employers and their employees who are involved in the worksite-health initiative grew at a rate of almost three times that of the control group.
As shown in the second exhibit on page XX, we experienced growth in ED, inpatient, and outpatient areas. While increases in inpatient and outpatient services may have been expected, ED growth is likely attributable to better patient education resulting from our consistent presence in front of this audience. Promoting the ProHealth Works brand pays dividends as it reinforces our system as the “provider of choice.”
ProHealth Works: Revenue Growth by Patient Type
ProHealth Works Group
From the time that ProHealth Works was introduced, ProHealth Care’s overall market share in its historical service area (of about 500,000 residents) has increased from 43.6 percent to 46.4 percent.
Remember, all of these new customers are favorably insured individuals, meaning that the hospital isn’t just building market share but is doing so through a strategically targeted and selective approach that mass advertising or other mass communication tactics simply cannot match.
ProHealth Works has provided other benefits as well. By giving employers and their workers a voice on the real health issues that concern them, ProHealth Care has been able to make programmatic and service line refinements that better serve the community. New additions attributable to ProHealth Works include stop-smoking classes, diabetes management and education, stress management, and more.
Because our employer groups pay for the services to complete the survey and biometrics, we are not able to record our educational efforts under the wing of community benefits. However, with the changes in healthcare reform, we are revisiting this option.
Healthcare organizations that are considering an employer-directed business development initiative need to be committed to the program for the long term. Here are four lessons learned.
Patience and diligence are essential. Even the most receptive employers may take a while to commit an investment outlay to the program. There are budgeting cycles, insurance plan changes/renewals, and cyclical dips in profitability that need to be considered. Don’t be surprised if the time frame averages six months to a year—from presenting the concept to an employer to the employer actually signing on the dotted line.
Equate wellness with cost savings, not expenditures.Many employers do not yet understand the concept of health management or the dramatic reduction it can have in healthcare costs over time. Also, they see such programs as a drain on productivity that take employees away from the business at hand. In reality, a significant derived benefit of these programs is increased employee attendance. As employees improve their health, they take fewer sick days and increase productivity.
Employers need to see aggregate data showing that health management programs can achieve a measurable ROI over time. Here are some statistics from our health risk assessment program that may help convince employers.
* A mid-sized company that participated in ProHealth Works reduced hypertension among its 135 employers by 16.4 percent (from 28 percent to 11.6 percent) over two years—while also raising the percentage of employees with normal blood pressure readings to 43.4 percent, from 24 percent.
* A ProHealth Works client with 112 employees reduced the percentage of employees who smoked to 9.9 percent, from 13.9 percent—and increased the percentage of normal glucose readings to 81.1 percent, from 69.6 percent.
Educate employees on the value of health management.Just as employers tend to misunderstand the importance of wellness, many employees have an appliance mentality: “I’ll fix it when it breaks.” There needs to be consistent messaging on the importance of health management, such as maintaining a healthy weight and committing to regular exercise. Encouraging employee participation in health management programs is key to making a measurable impact over time, by worksite, and by employee.
Find the right champion to lead the effort. Many organizations have most of the elements in place to initiate an employer-directed business development initiative. However, the program requires a dedicated champion with the passion to “sell” wellness, earn employers’ trust, analyze the data and perform as a true partner in counseling businesses on how to get the most out of the program. Selecting the right leader will help ensure that the initiative scores a win-win-win for employers, their employees and the health system that sponsors it.
Capitalizing on Potential
Finding and creating new channels to build desirable market share is key to hospital survival and profitability. Those hospitals and health systems that can identify promising opportunities in their catchment area and then capitalize on the potential they represent will emerge as clear frontrunners when it comes to winning the hearts and minds of customers—and the resulting market share. ProHealth Care has done just that by harnessing an innovative relationship strategy with employers in its marketplace.
Ford Titus, CEO of ProHealth Care, Waukesha, Wis. (firstname.lastname@example.org). Henry Ross is CEO of Aegis Health Group, Brentwood, Tenn. (email@example.com).