Managing airline transactions is something of a sedentary job. And with 400 desk staff, the Airlines Reporting Corporation (ARC) had its fair share of employee health worries. Diabetes, high blood pressure and weight loss all contributed to an unfit workforce – and expensive healthcare premiums.
But the company managed to turn around its escalating healthcare costs with a preventative healthcare program, and proved that others can do the same. “In 2008 we projected a 30% increase in premium expense over 2007 expense, and realising that we could potentially be looking at cost increases that high, we decided that we needed a way to help control that,” says Mike Gilliland, ARC’s vice president of human resources.
“So we looked at implementing a wellness programme that we could influence or encourage employees to take a more proactive approach in terms of their health, and living a healthier lifestyle,” he adds.
A stitch in time saves nine, or so the saying goes. Catching health conditions before they become a problem is far easier and cheaper than acute treatment later on. Reducing the number of insurance claims also means that preventative healthcare can help to reduce health care premiums.
With premiums rising in the US, this is a big concern for companies. According to the Kaiser/HRET survey of employer-sponsored health benefits, the premiums for health insurance arranged as part of workplace health insurance grew by 114% between 2000 and 2010. US employees are now paying on average a quarter of their salary for health insurance.
So how can companies and employees alike make their health care dollars work smarter, rather than harder? Specialist firms offer employee healthcare training programs to corporate customers, with a view to improving employee health, and reducing premiums.
ARC pays 80% of its employees’ health care premiums, so their premiums are a big consideration. It signed with LiveHealthier, a company providing health and wellness programmes both online and in the workplace. It provides a team of coaches including dieticians, nurses and certified personal trainers.
ARC signed up to a programme that began with a series of biometric scans for employees. “To encourage people to participate in biometric screenings, we offered them a free day off. I believe we got upwards of 75% participation,” Gilliland says. The screening gave employees a picture of their health, and another screening was arranged for January this year to see how they had progressed.
The firm then began organising a series of challenges for employees, designed to motivate them in looking after their own health. These challenges generally cost a nominal fee to enter, with this being matched by the company. This led to a cash prize for the winners.
Participants had to work with LiveHealthier’s coaches to be sure that they achieved their goals in a healthy way, and they were physically tracked to monitor their progress.
“The challenges that we’ve run over the past couple of years is that participation has not been high. We got a maximum of 50 people per challenge,” Gilliland says. “Anything that involves a lot of tracking people with a lot of physical activity, that tends to turn people off a lot.” In feedback sessions, people also said that they wanted more team activity, rather than individually-focused challenges.
However, initiatives like this aren’t discrete, and it can take time to turn employees’ perspectives around. Companies can also boost staff by integrating a healthier lifestyle into their corporate cultures, and ARC began offering healthier food choices at catered events and in its vending machines. It also took advantage of a health portal that LiveHealthier provided, which gave employees updates and success stories.
Nevertheless, there have been some positive results from the tests, Gilliland says. The company monitored the cost of its premiums, and found the lowest increase in its history in 2011. “What the insurers had told us is that every insurer was going to add 2.5% to any premium cost for 2011 due to the Healthcare Reform Act. So in essence, if you took that away, this would be the first time in the history of the company that we were looking at zero-based cost [increase] to healthcare.”
In the subsequent biometric screening this January, the firm found that diabetes, high blood pressure and high cholesterol had all dropped.
“We were looking at an increase in premium expense of around $300,000 (￡187,000) per year for a population of 400 employees,” he says, adding that the cost of the course, administration and vacation incentives for biometric screening have been offset by the money saved. He also points out that this is an ongoing benefit: “In terms of cost of claims, we would recover the cost of the programme each year.”
Making people responsible for their own health early on, rather than waiting for obesity, diabetes or high blood pressure to take their toll, seems to be working for ARC. Such initiatives can also build morale if organised properly, and lead to more energetic employees. When staff are sitting at their desks for eight hours a day, that can only be a good thing.