January 18, 2007

How Law Firms Can Increase Health Benefits – And At the Same Time Lower Costs

An Interview by Mark Bisnow
with Fiona Gathright, founder,
Wellness Corporate Solutions

The Wall Street Journal last month carried a large piece on how small and medium sized businesses, not just big corporations, are trying to beef up rather than cut health benefits because they realize in the long run it saves money. This made me realize even more the significance of what Fiona is doing.  I thought we ought to do an interview.
What do you do for law firms and others?
Basically we go to employers, and they have us work with their employees to adopt healthy lifestyle habits.  We educate them about their health, and then work with them on it.  Preventive care like this can help both employees and employers tremendously.
How specifically do you go about improving health?
For example, we come in and do health care fairs and assessments.  We test for blood pressure and cholesterol, give flu shots, create programs for employees to exercise, manage their weight, stop smoking, and so on.  We break them down into risk categories.  We might enroll the highest risk employees in a voluntary, telephone-based coaching program.
A lot of people are busy or stuck in their ways. How do you maximize participation?
We encourage clients to provide incentives, so if you take a health risk assessment you might get a $50 gift certificate to Sports Authority. Or if you attend three seminars on stress management, nuturition, and fitness, you might get something else.  If you complete a smoking cessation program, you might get a $500 certificate.  We offer all kinds of behavior modification programs. And we make them very accessible, including online.  We have an online wellness resource center with all content written by Duke University, and short video seminars.  We create portals on clients' websites, branded to them.
And the cost?
Our online product is very inexpensive, about $2 a month per employees, way less than their donut bill.  Our charges are either al la carte or based on a year long contract which has been calculated per employee per month.
Why do companies hire you? What's driving this market?
They're deeply concerned about rising health care costs being incurred by both themselves and their employees.  Costs are rising at seven percent a year, and many firms are requiring employees to pay a higher and higher percentage of their health care.  But there's only so much you can pass on to the employee before they leave—or only so much in benefits you can cut back. At the same time, employers realize it's in their interest to preserve health care benefits.  Most adults spend a large percentage of their waking hours on the job.  Countless studies show incredible ROI for employers—from three dollars to 18 dollars in return for every dollar they spend on health care.
That's an impressive ROI figure.  But how can that really be?
Because when people are healthy and exercising, they're not absent as often, they can be managed better, they're more productive, there is reduced risk for heart disease and diabetes, there's less obesity which leads to those things.  You might get a better picture if you consider this statistic:  You can generate an investment return of 200% for every $10,000 invested in wellness by getting six people to stop smoking, or preventing two employees from getting diabetes, or getting eight employees to lower their body mass index from above 30 to under 30, or preventing one employee from incurring a stress-related insurance claim.
Why don't firms just turn to their existing health care providers to do this?
They can, but we find that employees often don't entrust those big companies with their personal health information.  They are afraid, rightly or wrongly, that they might use the information against them in insurance decisions.
What kind of personal information are you talking about?
We do a health risk assessment of all a client's employees.  They fill out either an online or paper health history on themselves and their family—you know, whether they smoke or drink, and so on.  We then provide them a confidential report about their own health risk, plus we create an aggregate report for the employer.  It will say something like "30 percent of your employees are at risk for this or that, but if you implement these programs, you can probably reduce your health care costs by this or that amount."  Most health care costs are driven by preventable conditions.  Yet the system is not structured to promote prevention and health.  It's more of an illness care system.
Are firms using heath care savings accounts for employees?
Yes, and more broadly they are encouraging something we call "medical consumerism."  The trend is to remind people that their decisions about health affect their own future premiums and those of their colleagues.  People don't really understand that connection.  They know that if you have a heart attack it costs a lot of money, although they may not realize how much.  Do you know that if a D.C. policeman has a heart attack, it costs the department $750,000?  You are basically impacting the health insurance premiums of everyone in your company.  So what that means is that an individual's lifestyle choices can create costs for everyone.  Employees are also learning they can personally make money by being careful.
What do you mean?  How can employees make money through their decisions?
If you contribute a certain amount of money to a health care savings account, you can either spend it down or, if you keep yourself in good health, that money can grow.  That's where we come in.  We encourage employees to get screened, understand their health risks, talk to a registered dietician, and so on.  If they get results from glucose or blood pressure tests, we can tell if they're a borderline diabetic, what to do about it, and if they need to go see a physician.  And so on.  
How did you start this company?
My expertise was marketing, but I cared a great deal about health issues and costs going through the roof.  At the beginning of 2005, I got together with Juliette Rodman, an expert in exercise physiology and registered dietician who worked for a large nationwide wellness company. We decided to combine our expertise.
What clients do you work for?
Companies such as Discovery and Bloomberg, and quite a number of local law firms, such as Dickstein Shapiro, Mayer Brown, Zuckerman Spader, Nixon Peabody, Morgan Lewis, and Bryan Cave.  
Discovery sounds like a hip place to do this.
They actually instituted a firm-wide employee body challenge.  It was an eight week contest to lose weight and get fitter, and they competed against America Online.
That could be a hot fad, companies challenging other companies.
Employees got a lot out of it.  We sent coaches to 13 of their locations around country.
Who won?
That's confidential health care information.  :)

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