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Award puts state at center of wellness program debate

Award puts state at center of wellness program debate

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LINCOLN -- In its first two years, Nebraska's state employee wellness program said it had saved $4.2 million, caught more than 500 early cancers and improved the health of thousands of employees.

Last year it helped Nebraska become the first state to win the prestigious C. Everett Koop Award, given for promoting better health while cutting medical costs.

Gov. Dave Heineman has touted it as a model of how to make health care more affordable and as an alternative to the federal health care overhaul.

But a Massachusetts-based expert in analyzing health outcomes says the claims about Nebraska's wellness program amount to so much hokum.

"The bottom line is their numbers don't add up," said Al Lewis, who has criticized the program in recent blog posts and an opinion piece in the Wall Street Journal.

"They're spending millions of dollars to tell people three things they should already know: Stop smoking, eat healthier foods and exercise more," he said.

Lewis' arguments about the Nebraska program are part of his broader challenge of many workplace wellness programs, which he labels "get well quick" schemes.

He's not the only one questioning whether workplace wellness programs produce the savings claimed, even as incentives offered under the federal health care overhaul mean the programs are set to proliferate.

A RAND Corp. report released in May concluded that wellness programs can improve health but barely pay for themselves in the short term.

The RAND study was the largest assessment of work site wellness programs to date, looking at almost 600,000 employees and dependents at seven employers.

It found that participating in a wellness program for five years was associated with annual health care savings of $157 per person, while the annual cost of the programs averaged $150 per person.

The researchers held out hope for a payoff in the long run, as better health habits prevent costly future cases of heart disease, diabetes and other conditions.

"It seems that wellness proponents were overly optimistic about how quickly and strongly health benefits translated into savings," said Soeren Mattke, a senior RAND scientist and managing director of RAND Health Advisory Services, and Kristin Van Busum, a RAND researcher.

State Auditor Mike Foley also has been skeptical of the savings reported for Nebraska's wellness program.

In an audit last year, he called for the state to analyze whether the program's financial benefits outweigh the added administrative costs.

But others strongly defend the Nebraska program and work site wellness efforts in general.

Wellness programs have exploded because businesses are looking at their aging workforce and seeking to control rising health care costs, said David Hunnicutt, president of the Omaha-based Wellness Council of America, or WELCOA.

"Anything we can do to keep people from moving into a high-risk (health) category is money well spent," he said.

Hunnicutt dismissed the RAND report as "one opinion and one study," which he said is contradicted by hundreds of other studies.

He called Nebraska's wellness program a model for others and said he has talked to several participants who say they have changed their lives because of the program.

WELCOA named the state a Gold Well Workplace in 2011, the group's second-highest honor.

Ron Goetzel, president and CEO of the Health Project, which gives out the Koop Awards, also praised Nebraska's program.

Nebraska won its Koop Award by demonstrating to reviewers that it had a comprehensive wellness program that changed employee health behaviors and reduced costs, he said.

The Koop and WELCOA Awards and resulting publicity caught Lewis' eye. He is founder and president of the Disease Management Purchasing Consortium International, which evaluates health outcomes for business clients.

In December, Forbes magazine named him one of 13 "unsung heroes changing health care from the outside in" because of his critiques of wellness program claims.

Upon looking into Nebraska's program, Lewis concluded that the $4.2 million of reported savings was based on faulty methodology. He also questioned claims that the program had reduced hospital stays, emergency room visits and prescription drug use.

Nebraska has done no independent analysis of its wellness program since it was launched in July 2009. Josh Stafursky, the state wellness and benefits administrator, said the state plans to contract for such an analysis later this year.

To date, all evaluation and analysis has been done by HealthFitness, the Minneapolis-based subsidiary of the Trustmark Cos. that holds a five-year contract to administer the state wellness program.

To calculate the program's savings, HealthFitness officials matched wellness program participants with nonparticipants, then compared their health costs over time.

Employees were matched by age, gender, claims history and predictions of future claims.

Similar matching was used to analyze hospital stays, emergency room visits and prescription drug use.

The savings figure represents slower growth in health claims for wellness program participants compared with claims for nonparticipants, rather than an actual reduction in health costs.

The savings factors in the approximately $2 million that Nebraska pays to HealthFitness each year -- the total was $2.4 million in the 2011-12 fiscal year.

Dr. Dennis Richling, chief medical and wellness officer for HealthFitness and a former Union Pacific Railroad executive, said the matching method used to calculate savings is common in the field and has been validated by wellness industry leaders.

But Lewis said the matching method doesn't account for the fundamental difference between the two employee groups.

Those who participate in the state wellness program tend to be motivated to improve their health. Those who don't participate tend to lack that motivation, even though participation could save them money.

Employees on the wellness insurance paid $86.64 monthly for single coverage last year, compared with $104.84 for the regular insurance option. They also had lower deductibles and co-pays.

Motivation, according to Lewis, is critical to success in wellness programs. Participants are likely to have lower health care costs with or without a wellness program, he said.

Lewis noted that neither the state nor HealthFitness had looked at a more straight-forward measure: trends in health problems directly linked to behavior changes, such as heart attacks and strokes.

Goetzel, who is director of Emory University's Institute for Health and Productivity Studies and vice president of Truven Health Analytics, along with his work on the Koop Award, said Lewis raises important issues.

But he said multiple methods can be used to calculate wellness program savings and none is perfect in a real-world setting. He supported the method used for the Nebraska program.

WELCOA's Hunnicutt said he believes the methodology for the program is strong.

Stafursky, the state wellness administrator, and HealthFitness executive Richling staunchly defended the savings calculations and the Nebraska wellness program.

"We fundamentally disagree with Mr. Lewis' assertions," Stafursky said, calling the program "a great value for the taxpayers and the participants."

Heineman, although a major promoter of the program, declined through his spokeswoman to comment about Lewis' critique.

In addition to challenging the savings figure, Lewis took issue with the claim that the program had caught 514 early cases of cancer in two years.

The figure has been repeated frequently by state officials.

Lewis said the claim made it appear there was an "absolutely massive" number of cancers among Nebraska state employees and spouses.

Upon questioning by The World-Herald, Richling acknowledged that almost all of the cases labeled "early cancer" actually involve benign colorectal polyps and pre-cancerous lesions of the cervix.

"Technically, from a medical perspective, they're not (cancer)," he acknowledged.

In response, Lewis criticized the company for "lying" about catching early cancer cases to inflate the apparent success of the wellness program.

Richling said the matter was one of semantics.

Polyps and lesions can lead to cancer, he said, and HealthFitness called them cancer to emphasize the importance of Pap smears, colonoscopies and other preventive screenings.

Stafursky charged that Lewis tries to drum up business for himself by discrediting companies and employers that promote the benefits of wellness programs.

For his part, Lewis said he believes there are positive aspects to wellness programs and that they can yield benefits.

However, he said, the savings are likely to be smaller than many companies claim, and that the programs have been overhyped as ways to reduce medical costs.

"No matter who does them, the numbers have to add up," he said. "Math is not a popularity contest."

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