Employers Need Help Defining Value of Health Interventions

Occupational health professionals are strategically positioned to help employers make informed choices about their investments in workforce health.

According to a study released this week, employers face challenges when gathering the information they need to fully assess the impact of ill health and health-related interventions in working populations. The study, Synergies at Work: Realizing the Full Value of Health Investments, provides a framework for evaluation. Eight employer case studies are used to illustrate the concepts.

To appreciate the big picture, employers must incorporate evidence beyond medical claim data, such as intervention results and incidence and duration rates associated with workplace absence and disability, the study’s authors said.

The findings shed light on opportunities for occupational health professionals as they prepare to assist employers with value-oriented analysis through the rigorous application of key performance indicators relevant to both internal operations and the end user. 

An NAOHP benchmarking committee is engaged in the process of defining key metrics and plans to pilot-test them at selected locations starting this spring. Preliminary results will be presented at RYAN Associates’ 25^th annual National Conference, Oct. 17-19 in Atlanta.  

Synergies at Work is a collaborative effort of A. Mark Fendrick, M.D., co-director of the University of Michigan Center for Value-Based Insurance Design (V-BID Center), Thomas Parry, Ph.D., president, and Kimberly Jinnett, Ph.D., research director, both of the Integrated Benefits Institute (IBI), San Francisco. The study was supported by the National Pharmaceutical Council, a health policy research organization funded by pharmaceutical companies.

“Employers can contribute greatly to the transformation of the health system by focusing on value and not simply on financing and who pays,” said Dr. Fendrick. “It is imperative that we move beyond the current paradigm of exclusively measuring medical offsets and include measurement of the effects in increased productivity that accompanies improvements in health.”

Employers generally undervalue the impact of improved health outcomes to businesses and their employees, the authors said. According to IBI’s research-based modeling tool, the Full Cost Estimator, for a 10,000-life sample employer in the health care services sector, for example, medical care costs amount to less than 30 percent of all health-related costs for workers. The remaining 70 percent is associated with wage-replacement payments and lost productivity from absence or reduced job performance from ill health. 

“Including a measure of the economic benefits of good health that reflects the true costs of ill health and the full savings from health improvement would immediately allow decision-makers and payers to make better choices as to how much to invest in health care, prevention and wellness, as well as how to determine the specific services in which to invest,” Dr. Parry said.