Today more than ever, we as a nation face the challenge of rising healthcare costs. $3 out of every $4 spent on healthcare goes toward chronic diseases rather than the prevention of diseases and the promotion of health. Wellness has been a focus for some time within our existing healthcare system, but has not quite achieved the transformation at a national level to help curb our spiraling costs. There lies a great opportunity for any healthcare organization, whether payer or provider, to differentiate themselves as a leader at the forefront of transforming healthcare from sick-care to well-care. The opportunity to benefit from wellness programs is very timely today due to several key factors:
- Cost Containment. Employers can expect an 8.5% increase in healthcare costs in 2012, compared to 8.0% in 2011. Employers are taking some action to address rising costs as evidenced by the growing number of Consumer Directed Health Plans (CDHP). In 2011, an estimated 61% of companies offered CDHPs, up from 54% of companies in 2010 and 48% in 2009. The pressure to reduce healthcare costs has never been stronger than now for employers.
- Health Insurance Exchanges. The payback period for comprehensive wellness programs range between three to five years and, according to some studies, could be as little as two years if productivity calculations are included in the ROI. Many health plans are concerned about retaining their competitive advantage when the 2014 insurance exchanges proliferate. If health plans are to differentiate themselves in the face of the 2014 exchanges, now is the time to launch comprehensive programs, establish their ROI in the marketplace and capture new entrants into the individual market.
- Backlogged Demand. Most firms recognize the value of wellness programs but have put off their implementation due to difficult economic times. However, the U.S. economy seems to be turning a corner. Unemployment stood at 8.5% in Dec 2011, the fourth month in a row we saw a decrease. There is a large unmet demand and now is the time to meet it.
- Numerous Mid to Large Sized Firms. Very few large size firms create in house wellness programs and most mid-size firms cannot afford to do so. However, all firms still face the demand to lower healthcare costs. Furthermore, wellness programs are becoming a common way for firms to differentiate themselves during corporate recruiting. To be competitive in the recruitment market and reduce healthcare costs, firms need comprehensive wellness programs now more than ever.
To learn more about comprehensive wellness, read the West Monroe white paper Comprehensive Wellness: The Next and Timely Differentiator for the Healthcare Market.