cdhc solutions may/june 11

WWW.CDhCsOLUTIONsMaG.COM MaY/JUNE 2011 vOL 7 NO. 4 $7 Usa

Benefi ts’ Rules of engagementBett er CommunicationEquals More Education

Get Well now! Don’t Wait for Health Care Reform; Wellness Works, Now

Consumerism lowers Benefi ts Costs: Fundamental to Way of life

Introduction of solution Provider’s Innovation showcase

CDHC Solutions FORUM East Recap, Conference Heading West

838036 LSC-ATL-BA CDHC Solutions Magazine_v4.indd 1 7/6/10 3:55 PM

CIGNA is a Gold Sponsor of the CDHC Solutions Forum,September 15th and 16th in Denver, CO. For more information,go to: www.cdhcsolutionsforum.com

www.cdhcsolutionsmag.com I CDHC Solutions™ I May/June 2011 3

I n s I d eF e a t u r e s

COMING UP NEXT: Increasing participation in your CDHP programs; Health care cost savings and education tools to provide your employers; Population Health & Wellness special supplement on trends and best practices.

ON ThE COvEr: Audrey Tillman, executive vice president of corporate services for Aflac, instructs employers about new employee benefits being offered by Aflac at its corporate headquarters in Columbus, Ga.

36 Consumerism Lowers Benefits CostsIf the choice was up for vote: Vote for lower costs. Vote for freedom in health care. Vote for society to gain protection, economic structure and efficiency within their benefits. Consumerism is economically desirable, especially in the health care regime; but why is it falling apart? Why are companies buying benefits, rather than “we, the people” with needs? Are there expectations for change? Possibly. Hopeful thinking consists of merging the terms “benefits” and “medical insurance” together by eliminating the 800-pound gorilla that hawks other benefits and leads most boardroom conversations. Can consumerism please stand up?

By Ashok Subramanian

32 Get Well soon! Don’t Wait for health Care reform… Wellness and Prevention Works, NowIt is evident: To learn from a master is a gift. Van Gogh, Mozart and even today’s Mark Zuckerberg underwent some extensive apprenticing. Why not learn from businesses “doing it right” under our very own eyes? Being in the business of business, we should open our awareness to the areas with the greatest need for transformation, including shifting our nation’s focus from disease mode to a prevention mind-set. Wouldn’t that be great? This issue—a keen vision by Wellness and Prevention, a Johnson & Johnson company, they believe in taking the correct approach to reducing confusion and improving value in the workplace. They authentically believe in serving prevention and wellness as the main course for their employees; a confirmed ROI for Johnson & Johnson.

By Jennifer Bruno

29 Benefits’ Rules of engagement: Better Communication equals More education

Back in the day, being “smart,” also known as “being a nerd,” was a sure reason to run home once the school bell rang. today, being smart, educated and refined is sublime, cool and slick. even smart, the automotive brand that questions the status quo, says the following on their press website: “We have the courage to demonstrate personality while finding unconventional transportation solutions to urban congestion and environmental issues.” Where is your courage to alter the health care reality in your office? Although the drafts for business productivity have been altered, what remains undamaged is the indispensable employer-employee relationship. Leaders in the office know that in order to achieve new expectations and requirements they need industrious employees. How is this achieved? First, become sold in becoming smarter? Take more risks in communicating to your employees by holding genuine conversations. The result: employee’s loyalty, work productivity, job satisfaction and retention.

By Audrey Tillman

4 May/June 2011 I CDHC Solutions™ I www.cdhcsolutionsmag.com

d e P A R t M e n t s o N l I N e

P R I n t A n d o n L I n e K e YConnect with CdhC experts and community members online at www.CdhCsolutionsMag.com by looking for the following symbols at the end of each article:

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& EDUCATION

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CdhC solutions online brings you Web 2.0 at its best—a social networking site dedicated to providing expert advice, trends, and information about consumer-directed health care using a 24/7, virtual, portable format.

health care delivery and benefi t design are changing at a frenetic pace. are you successfully navigating the shift ing paradigm? learn how on CdhCsolutionsMag.com.

W e B - o N l Y F e a t u r e sRewards & Incentives

Healthy Incentives – A Global Solution to eff ect Change NowBy RedBrick Health

Policy & Legislationemployers Wary of Health Care Reform Costs and Hassles

By Shannon Demaree, Katy Curry, Ed Fensholt, Mark Holloway,

Population health and WellnessMaybe it is employers, Providers who Need to be educated Consumers

By William Bennett

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Make sure to join our group on linkedIn, CdhC solutions, and participate in the latest discussions on CdhPs

tweet tweetFollow CdhC solutions on twitt er, @cdhcsolutions, to stay in the loop with latest health care reform news and industry updates.

FacebookFan CdhC solutions on Facebook to connect with other CdhC followers and get recent site postings from our wall feeds.

Featured BlogTh e real Face of health Care Consumerism

By Evan Falchuk

eventTh e 2011 CDhC solutions FOrUM: our Conference has expanded with our inaugural ForuM West in denver growing to a two-day event, sept. 15-16. www.cdhcsolutionsmag.com/forum/

Have something to share? Post a blog or forum on www.cdhcsolutionsmag.com today!

6 editor and Publisher’s Lett erIt’s all about learning, sharing, Connecting

9 health Care ConsumerismIt’s a What Class act?

By Ronald E. Bachman

10-15 CdhC solutions FoRuM east/West� recap of ForuM east – employers eager to

learn More about Consumerism� Images and Quotes From att endees� Featured speakers for ForuM West in denver� What’s New for ForuM West

16 People on the Move / Briefs / InnovationsCastlight health enables life technologies to take Control of health Care Costs

17 Th ought Leadership a Value-based approach

By Foundation for Chiropractic Progress

21 hsA/FsA/hRA Administration & Financeeliminate Chaos by Communicating the Precise Message

By JoAnn M. Laing

23 supplemental health & Voluntary Benefi tsIntegrating Voluntary Insurance Benefi ts at the Workplace

By Jim Christenson

25 health Plans – ACosaCos Can’t aff ord to Forget about empowering the Consumer

By John Reynolds

27 Pharmacy Benefi t ManagementPharmacy Benefi t Cost strategies for employers

By Larry Boress

38-43 Innovation showcase� an hdhP/hsa Could be Best Medicine for employer’s

health Plan By Alliant Credit Union� Providing Complete transparency, Full disclosure key

in Choosing Best PBM By Envision Rx� set and surpass: reaching Wellness Goals with a

healthy dose of Incentives By Best Buy

44 Ask the expertTh ere’s No Choice But Change

By Grace-Marie Turner

45 stats & datatransparency: Th e Key to sustaining the Consumer-directed health Care Movement

By Leah Binder, William Robinson

47 Who’s Who Profi les50 Resource Guide/Ad Index

Visit us in Denver at FORUM West

Booth #4


Todd CallahanManaging [email protected]

Doug FieldCEO/[email protected]

L e t t e R edItor & PuBlIsher

taking the advice of 19th century newspaper owner horace Greeley, CdhC solutions is going West, as we present our CdhC solutions ForuM West in denver on sept. 15-16. If you were unable to go to ForuM east, held in atlanta May 11-12, you should make it a priority to attend the Conference in the Mile high City.

Passionate about the country’s expansion West from the overcrowded cities and high unemployment rates in the east, Greeley advised a young nation to, “Go West, young man. Go West and grow up with the Country.”

For employers bogged down by rising health care costs and questions about their health care benefits offerings, CdhC solutions ForuM West should be the destination of choice to get all the answers. It’s a place to come learn, share and connect with others facing similar challenges.

so to paraphrase Greeley’s famed quote, “Go West young man. Go West and grow up with the health care consumerism movement.”

originally slated to be a one-day event, ForuM West will be a two-day conference, featuring five general sessions and 15 workshops. like the previous two events in atlanta, denver’s agenda includes an employer panel, arguably the most informative general session of the entire program. attendees have commented the employer panel was their favorite part of the entire conference. In denver, the employer panel will feature the benefits director from safeway, as well as former benefits directors from Microsoft and Wal-Mart.

It’s a great opportunity to connect and learn from individuals from major companies who faced similar challenges you are facing. You also will hear from key thought leaders and experts speak about health care consumerism and health care reform.

“overall it was one of the best conferences I’ve ever attended in my 19 years in the insurance business,” said russell head, Partner, Group and Benefits Consultants, who was one of the 300-plus attendees at ForuM east. “[The] general sessions and workshops were well worth the time.”

For more information and to register for the ForuM in denver, please go to www.cdhcsolutions forum.com.

time to nominate Your Company’s superstarFor the sixth year in a row, CdhC solutions is proud to present our solutions superstars edition,

which will be published in december. Nominations are open and can be e-mailed to [email protected] or recorded online at www.cdhcsolutionsmag.com or www.employersweb.com.

The 11 categories are: John J. robbins sr. Memorial Ceo leadership award; Most Innovative employee empowerment award; Public Policy award; Ceo leadership award; Most Innovative health and Benefits Plan design award; Most effective health and Benefits Plan Implementation award; Most Innovative employee education/Communication award; Most effective health and Wellness award; Innovator award; Most Innovative Partner/Consultant award; and Most Innovative Broker award.

For more information, please see our ad on page 24. Nominations close sept. 30.We want to thank all attendees and sponsors who helped make ForuM east a great success,

and we look forward to seeing you in denver in september. stay tuned for some big announcements coming this summer as we continue building the collective voice on health care consumerism.

sincerely,

It’s all About Learning, Sharing, Connecting

www.cdhcsolutionsmag.comvOLUME 7 NO. 4 MaY/JUNE 2011

Published by FieldMedia llC292 south Main street, suite 400

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a s s O C I a T E P U b L I s h E r Brent Macy


M a N a G I N G E D I T O rtodd Callahan


s E N I O r E D I T O rMavian Arocha-Rowe

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ChaIrMaN OF CdhC solutIoNs EDITOrIaL aDvIsOrY bOarDronald e. Bachman, Ceo, healthcare Visions

E D I T O r I a L a D v I s O r Y b O a r Dronald e. Bachman, healthcare Visions

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CDHC Solutions™ Volume 7 Issue 4Copyright ©2011 by FieldMedia llC. all rights reserved.

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CDHC Solutions Magazine.indd 1 4/28/11 9:22 AM


BY RonALd e. BAChMAnFsa, Maaa, PresIdeNt aNd Ceo » heALthCARe VIsIons

heALth CAReConsuMeRIsM

the Patient Protect and affordable Care act (PPaCa) strikes again with its latest creation of the “Community living assistance services and supports act,” known as the Class Program. It is a new national entitle-

ment program that was effective Jan 1; however, implementation regulations are scheduled for october 2012. It is similar to a private long-term care plan that pays cash benefits to help purchase non-medical services such as home health care and adult day care services for those unable to perform certain “activities of daily living” (adls). to say the least, there are significant financial concerns and controversy with this program.

eligibilityanyone over 18, who is working, will be eligible for coverage. enrollment

is automatic and individuals will be assumed to be enrolled unless they explicitly opt out. It is estimated that more than 10 million americans need long-term services to assist them with adls, and that number is expected to grow with the aging of the population and growing number of people with disabilities.

What about premiums? The Center for Medicare and Medicaid services (CMs) has estimated an initial premium of at least $240 per month. The premium will ultimately be set by the health and human services (hhs) secretary. Premiums will surely vary by age at enrollment and by year of enrollment. as you can see, a major problem will begin to brew: The problem of any voluntary program is adverse selection.

The Class program requires higher income and healthier participants to subsidize the $5 premiums for students and low-income enrollees. For premiums to remain affordable Congress may ultimately have to subsidize the Class program—exactly what the proponents argued during health reform would not happen.

as for benefits, those individuals who pay into the program for at least five years (and work during at least three of those five years) plus meet eligibil-ity criteria will receive daily cash assistance if they have functional limitations that are expected to last at least 90 days.

Benefits will be assigned to individuals who are unable to perform two or more activities of daily living or adls (e.g. eating, toileting, bathing, dressing, transferring), individuals who have an equivalent cognitive disability that requires supervision, or hands-on assistance to perform those activities (e.g. traumatic brain injury, alzheimer’s disease, multiple sclerosis, mental retardation).

as expected, benefits will vary based on degree of disability or impairment averaging no less than $50 per day. The hhs secretary will set the benefits amount based on the degree of impairment, which is expected to average roughly $75 per day or approximately more than $27,000 per year. as of now, there are no lifetime limits, and benefits will continue for as long as a person remains qualified.

as far as the political realm and the talks heating up from this recent White house agreement, the Class act is controversial, especially in an era when existing entitlements, such as Medicaid, Medicare, and social security, are at the center of political debate for overpromised benefits and a lack of financial soundness. Many believe we cannot add another expensive new entitlement program; the question remains, can we, will we?

Critics argue that a “political financial trick” was played in promoting the Class act as a part of the PPaCa. a net Federal savings was estimated for the

Class program of $38 billion during the first nine years of operations—the first five of which are prior to any benefit payments. The PPaCa was promoted on the basis of a 10-year congressional budget. The 10-year budget period produces a savings to the federal deficit. however, after 2015 as benefits are paid, the net savings from this program will decline. By 2025 and later, projected benefits exceed premium revenues, resulting in a net annual federal deficit in all future years.

The office of the actuary at CMs estimates roughly 2.8 million persons will participate in the program by the third year. In addition, there are a signifi-cant number of disabled individuals who will immediately qualify for coverage. In the sixth year of the program these participants would begin to receive ben-efits, along with others who developed such limitations in the interim.

Is This Financially unsound?richard Foster, CMs chief actuary, said:“… programs such as CLASS face a significant risk of failure as a result of adverse selection by participants. Setting the premium at a rate sufficient to cover the costs for such a group further discourages persons in better health from participating, thereby leading to additional premium increases. This effect has been termed the “classic assessment spiral” or “insurance death spiral.” Based on an actuarial analysis there is a very serious risk that the problem of adverse selection will make the CLASS program unsustainable.”

In december 2010, the bipartisan National Commission on Fiscal responsibility and reform raised doubts about whether Class could be fixed in ways that were financially responsible and politically palatable. The commis-sion recommended that if Class couldn’t be reformed, it should be repealed:

“The program’s earliest beneficiaries will pay modest premiums for only a few years and receive benefits many times larger, so that sustaining the system over time will require increasing premiums and reducing benefits to the point that the program is neither appealing to potential customers nor able to accomplish its stated function. The program is therefore likely to require large general revenue transfers or else collapse under its own weight.”

While the Class act has not received much public airing, the political debate has begun; yet, the balance of evidence is always evident. Because of long-term financial concerns, a possible repeal of the Class act may seem par-tisan. The political difficulty in eliminating the program is based on the “deficit reduction” in the early years when the premiums are paid before benefits start. The financial turmoil will be further evident after 2025 when increasing benefits begin to be paid. It is vital for employers and other health care stakeholders to closely monitor the developing regulations and monitor the political wonders and ponders over the Class act. “Class warfare” is likely to be a key part of the 2012 presidential and congressional election debate. We will see…

Ronald E. Bachman FSA, MAAA, is president and CEO of Healthcare Visions Inc. He is a senior fellow at the Center for Health Transformation, the Georgia Public Policy Foundation, the Wye River Group on Health, and the National Center for Policy Analysis. Bachman is the chair of the editorial advisory board of CDHC Solutions and can be reached at [email protected].

It’s a What CLASS Act?


having seen its att endance more than double and sponsorship sell out just eight months between the inaugural CdhC solutions ForuM in september and ForuM east, the premiere

conference series dedicated solely to health care consumerism and understanding the health care law, is continuing to grow.

having expanded to two events in 2011—ForuM east in atlanta and ForuM West in denver—CdhC solutions Founder and Ceo doug Field has elected to expand the west conference to two days. Th e conference, slated for sept. 15-16, features an agenda similar to the spring event.

“our ForuM east was such a success that we felt the time was right to move from a one-day event to two days,” Field said. “Th e market is hot. employers are rapidly moving to the early adoption phase of health care consumerism. Th ey have questions, and the experts we have assembled can provide insight with real life experiences. We had to expand the agenda for our denver conference.”

ForuM east, held May 11-12 at the Cobb Galleria Centre in atlanta, featured 40 speakers providing valuable insights over a two-day period. Th e ForuM also featured two pre-conferences, att racting more than 50 participants. one pre-conference was sponsored and conducted by the National association of health underwriters, att racting many agents and brokers from around the southeast eager to take the consumer-directed health care certifi cation course and to receive continuing education credits.

Th e other pre-conference was titled, “health Care reform: What happened, What is to Come and What is still Needed.” It was conducted by executive members from the Center of health

transformation, the same organization founded by current presidential hopeful Newt Gingrich.

In addition to two pre-conferences, att endees had the benefi t of att ending fi ve general sessions, including an employer panel, featuring three employers of various sizes speaking about their trials and tribulations of implementing a CdhP, and a population health and wellness panel, featuring executives of redBrick health, healthways and Intelispend, speaking on the importance of implementing a wellness program. Th e panel sessions had the panelists arranged on the stage in a living room-like atmosphere. It made for a relaxed atmosphere that allowed the audience to freely engage the panelists with questions.

“General sessions and workshops were well worth the time,” said russell head, partner, Group and Benefi ts Consultants. “Th e pre-conference workshop from Th e Center of Wealth transformation was a wealth of knowledge. overall, it was one of the best conferences I’ve ever att ended in my 19 years in the insurance business.”

att endees also had the opportunity to choose to att end three workshops, out of a choice of 18.

“Th e variety of the workshops made it nice one that fi ts your interests,” said Kevin Vail, vice president, hsa manager of M&t Bank. “Th e location was nice and the food was excellent.”

Th e pre-conference led into the opening general session called,

Employers Eager to Learn More About ConsumerismCDHC Solutions FORUM Att endance Doubles fr om Inaugural Event

WraP-uPCdhC soLutIons FoRuM eAst

“Th e market is hot. Employers are rapidly moving to the early adoption

phase of health care consumerism. Th ey have questions, and the experts

we have assembled can provide insight with real life experiences. We

had to expand the agenda for our Denver conference.”


“The expanding Future of health Care Consumerism.” The 300-plus attendees received an overview of what the conference was all about from the opening panel, which included Field; ron Bachman, chairman, CdhC solutions editorial advisory Board; FIs Global General Manager tom torre; and alfac’s Jack Friou, senior vice president, director of government relations.

Bachman, senior fellow at Center for health transformation, set the tone for the event, outlining where we are headed with the future of employment-based health insurance under the Patient Protection and affordability act (PPaCa).

“health care consumerism is about transforming an employer’s health benefit plan into one that puts the decision-making and the purchasing power in the hands of the participants,” Bachman noted. “It’s about supplying the information and decision support tools needed, as well as offering financial incentives and rewards to encourage personal involvement and to foster a climate of behavioral change to create a healthier climate.”

using easy-to-understand graphs, Bachman outlined the multi-generational evolution of health care consumerism. The first generation focus on high-deductible plan design in conjunction with a health savings account (hsa), health reimbursement account (hra) or flexible spending account (Fsa).

First generation consumerism has become widely accepted, but more forward-thinking employers, who are ahead of the curve, are becoming second-generation consumers. They have established a wellness program, hoping to encourage behavioral change in their employees. The insightful employer realizes the best way to cut down on health care costs is to prevent the employee population from getting sick.

Bachman also laid the groundwork for future generations of consumers, focusing on health and organizational performance and the integration on how consumerism and behavioral change affects work performance in third-generation consumerism, and focusing on lifestyle, lifecycles and personal health needs in the fourth generation.

at the conclusion of the first day, featured speaker John hickman, partner at alston+Bird llP, broke down in laymen’s terms the new rules and regulations created by the PPaCa. he also predicted what was ahead in repealing the law. Not only was his presentation insightful, hickman also used his dry wit and sense of humor when discussing how 26-year-olds can still be covered under their parents’ health care plan. hickman used his own children as examples and shared amusing anecdotes that got chuckles from the audience.

In the opening session on the second day, the stage of the grand ballroom was transformed. The podium and table were replaced by potted plants, coffee table, and comfortable chairs in the general session titled, “Impact of health reform on health Care Consumerism: a Multi stakeholder View.”

The atmosphere seemed to work as Jon Comola, Ceo, chairman Wye river Group, moderated a lively discussion with panelists: John

Young of CIGNa, roy ramthun, a former cabinet member in the Bush administration, local broker ray Bachman, representing the small to mid-size employer market and Georgia state professor dr. William Custer provided different perspectives on health care reform.

The message was: We do not know with certainty how the health reform package will ultimately impact the popular health plan accounts and consumerism because so much of the content is yet to be developed at the state

CdhC soLutIons FoRuM eAstBY todd CALLAhAn, MaNaGING edItor, FIeLdMedIA


and within the federal agencies. The debate and question-and-answer sessions were lively during the session.

“[I] enjoyed the ‘Impact of health reform on health Care Consumerism: a Multi stakeholder View’ general session, because of the various viewpoints given from very informed panelists,” said tammie King, employee benefits specialist for Insurance Management Group.

like the inaugural ForuM in 2010, ForuM east concluded with an employer panel, featuring tom Crawford, human resources director at deKalb Medical, trudie Nacin, division chief, state health Benefit Plan, Georgia department of Community health, and Joe Jackson, senior vice president of hr for acuity Brands.

Nacin, designed a plan covering more than 696,000 lives. Crawford, who oversees more than 3,600 employees in a three-hospital system in the atlanta area, was instrumental in converting deKalb Medical’s health care plan to a CdhP.

Jackson was responsible for helping implement a CdhP for the 6,000 employees of acuity. unlike deKalb Medical, acuity is still in the implementation stage. attendees gained valuable insight to what was working and not working in regard to implementing a CdhP.

“[I] enjoyed the last session with the different employers on the panel discussing what they did ‘right’ when implementing CdhC plans,” said Marcy Malkin-starnes, senior hr specialist, Zep Inc. “I liked it because I am an employer and we are just getting started.”

starnes was not alone, while there were brokers, third party administrators, consultants, and regional health plan providers, the majority of attendees were employers. Many in attendance were large employers, such as atlanta-based home depot, havertys Furniture Companies and Mercedes-Benz.

after tremendous success, the FieldMedia team is turning its attention to CdhC solutions ForuM in denver, which will feature many of the same speakers, general sessions and workshops that were showcased in atlanta; however, with some new faces.

attendees in the West will be able to interact with Bachman, ramthun, Comola, Young, hickman and others during five general sessions, 15 workshops and several breaks to network and visit exhibition booths.

The employer panel will include shawn leavitt, VP of benefits for safeway, tom emerick, former VP of global benefit design for Wal-Mart, and Cecily hall, who was a former director of benefits for Microsoft.

additionally, attendees will have the opportunity to rub elbows and engage in lively debate with industry leaders during a table topic luncheon, featuring groups of eight discussing one of eight topics over lunch in the main ballroom.

also debuting in denver are three workshops called innovation showcase on pharmacy and drug benefits; population health and wellness; and rewards and incentives. each innovation showcase features three employers sharing innovations to what their company is developing as it relates to health care consumerism. each presentation is 15 minutes, and is followed by a question-and-answer session.

“as the collective voice around health care consumerism, this conference series is for any employer, tPa, broker, consultant or regional health plan managers eager to learn more about health care consumerism,” Field added. “You cannot afford to miss this. It is all about learning, sharing and connecting. afterward, you will walk away knowledgeable, inspired and prepared to implement new health care strategies to save your company time and money.”

WraP-uPCdhC soLutIons FoRuM eAst

Ron BachmanFSA, MAAA, Sr. Fellow, Center for Health Transformation; President, Healthcare Visions; Chairman of CDHC Solutions Editorial Advisory Board

Tom TorreSVP General Manager, FIS Consumer Driven Healthcare Solutions, FIS Global

John YoungVice President – Consumerism CIGNA HealthCare

Roy Ramthun An expert on Health Savings Accounts and consumer-directed health care issues.

Jon ComolaCEO and Chairman, Wye River Group; Founder of Foundation for American Healthcare Leadership

John HickmanPartner, Alston+Bird LLP

Featured Speakers

Who Should Attend?CEOs/Presidents/CFOsHR and benefi ts executivesHealth plan administratorsCorporate wellness and medical directorsBenefi t brokersThird party administratorsBenefi t consultantsBankers

www.cdhcsolutionsforum.com

BE A VOICEON HEALTH CARE

CONSUMERISMUnderstand the health care laws. Manage better health & benefi t choices. Empower your employees.

JOIN THE CONVERSATION

Following the success of FORUM East in Atlanta, the inaugural CDHC Solutions FORUM West conference, produced by CDHC Solutions magazine, will be held September 15 - 16 in Denver, CO at the Marriott Tech Center.

CDHC Solutions forums are designed for Employers, TPAs, Benefi t Brokers, Consultants and Regional Health Plan Providers who are seeking new strategies to enhance their current health and benefi t offerings, the latest updates and changes to the health care law, and the tools to implement consumer-directed health care, including:

• Supplemental health benefi ts

• Pharmacy benefi t management

• Population health and wellness strategies

• Employee incentives and communications

• HSA/HRA/FSA administration and fi nance

Featured speakers and top industry leaders will share valuable information and experiences that you cannot afford to miss. You will walk away knowledgeable, inspired and prepared to implement new health care strategies to save your company time and money.

It is our pleasure to host this conference series. We thank you for your participation and we continue to pledge unmatched dedication to integrity and knowledge in the industry through our forums, publications and online communities. We look forward to seeing you there.

Registration Dates:

Super Saver Deadline — July 7th, 2011

Standard Deadline — September 1st, 2011

Attendee conference registration includes:• Three innovative workshops of your choice• Five general sessions with top industry leaders• Continental breakfast, all-day breaks and boxed lunch• Opening night reception• Conference workbook• Free parking

Benefi ts of Attending Plan Ahead and Save

What You’ll Learn

CDHC Solutions,™ a FieldMedia Property

Gold Sponsors

Silver Sponsors & Exhibitors

Partnered with

Produced by

DenverFORUM WEST 2011

The FORUM West conference will be a 2 day event with 40 speakers participating in 5 general sessions and 15 workshops.

In addition to networking with top industry leaders, you will learn how to successfully navigate the changing health care landscape through topics and discussions, such as:

• The Expanding Future of Health Care Consumerism• Implementing Health Care Law: The Year in Review & What’s on the Horizon• Consumer-centric Employee Benefi ts• Cost Transparency: What Makes CDHC Truly Work

Plan to attend the pre-conference workshop on September 14th (additional fees apply) for hands-on, exclusive health & benefi ts solutions.

Visit www.cdhcsolutionsforum.com to preview the agenda and register for the conference.

www.cdhcsolutionsforum.comwww.cdhcsolutionsforum.com

Doug FieldPresident, Publisher, CEOFieldMedia, LLC

Ron Bachman, FSA, MAAAChairmanCDHC Solutions Editorial Advisory Board

Register at www.cdhcsolutionsforum.com. Group rates are available. Receive a 25% discount when you sign up two or more attendees.

Register now to receive our Super Saver rates and save your company money. At the FORUM you’ll learn strategies to lower health care costs and save even more. All Super Saver attendees are personally qualifi ed and will be entered into a drawing for an American Express® gift card:

1st Prize - $250 2nd Prize - $100 3rd Prize - $50*Non-transferable. Offer valid for Super Saver attendees only. Offer ends July 7th.

FORUM West 2011 • September 15 - 16 • Denver Marriott Tech Center

NEW IN DENVER- “Innovation Showcase” Workshops

- “Table Topic Lunch” – Discuss a variety of topics with peers and industry leaders over lunch.

- Interactive Employer Panel


PeoPle oN the MoVeBRIeFs

PeoPLe on the MoVeChange:healthcare announced the addition of howard McLure as chairman of the board, effective immediately. Mclure also will transition to chief executive officer over the next several months, replacing company founder Christopher Parks, who will move to chief development officer to lead continued development of the company’s platform and strategic relationships. The president of CVs/Caremark Pharmacy services from 2007 to 2009, where he presided over a $50 billion operation and 15,000 employees. Mclure will lead change:healthcare through its next stage of growth as the company continues to gain significant traction with its Cost transparency solution. For the past 11 years, Mclure has been a key driver of the development and expansion of the Pharmacy Benefit Manager (PBM) industry and was a significant player in the merger with CVs in 2007. after the merger, Mclure assumed the role of president, Caremark Pharmacy service, the PBM division of the combined organization. In this role, Mclure also was the driver behind the development of creative consumer-facing pharmacy solutions unique to the PBM industry that generated both financial success and value for retailers, employers and consumers.

safeway Inc. announced the appointment of darren singer as the company’s new senior vice president of pharmacy, health and wellness,

with overall responsibility for retail pharmacy operations, specialty care, pharmacy services, compliance, benefit management and managed care. he will report directly to Kelly Griffith, safeway’s president of merchandising. singer comes to safeway after a long career with GlaxosmithKline (GsK) where he was most recently vice president of strategic Growth. he spent 25 years with GsK in various leadership capacities, including vice president of marketing—otC wellness, and president and general manager of the Block drug Company, which GsK purchased in 2001.

u.s. secretary of health and human services Kathleen sebelius announced the appointment of a Baton rouge insurance executive to the national Committee on Vital and health statistics (nCVhs). Worachote “ob” soonthornsima, senior vice president and chief information officer of Blue Cross and Blue shield of Louisiana, will be the sole representative of the insurance industry on the panel when his term started June 1, 2011. The NCVhs advises the hhs chief on policy related to health statistics and the health Insurance Portability and accountability act, commonly known as hIPaa. soonthornsima has been the top information technology and security officer at Blue Cross since 2003. he also directs the company’s louisiana health Information technology strategy. The effort’s goal is to increase the use of electronic health records across the state. he is credited

Castlight health enables Life technologies to take Control of health Care Costs

Castlight Health, the premier company enabling employers and health plans to take control of health care costs through easy-to-use shopping tools with unbiased pricing and quality information, announced that Life Technologies Corporation has implemented the Castlight shopping portal for their benefits-eligible employees across the U.S.

Since implementation in January, Life Technologies employees have overwhelmingly adopted Castlight Health’s platform. More than 50 percent of eligible Life Technologies employees activated their Castlight Health account in just the first month, more than twice Life Technologies’ expectations for the first year. More than 60 percent of those registered employers have already shopped for health care using Castlight.

“Life Technologies’ employees power the innovation that our company delivers, so we are proud of being able to offer them a system which gives them the ability to take control of their health care and make informed decisions on costs and quality before visiting the doctor,” said Dr. Peter Leddy, Senior Vice President of Global Human Resources for Life Technologies. “We want to empower our employees in their wellness and I’m pleased that the majority of eligible employees have already used Castlight to take charge of their health care decisions.”

Life Technologies, a global biotechnology company dedicated to improving the human condition by enabling researchers to accelerate scientific exploration, is committed to bettering the health and productivity of their employee base.

As part of their 2011 benefits year, Life Technologies introduced several consumer-directed health plans in conjunction with a health savings accounts (HSA) for all eligible employees. In addition, they implemented Castlight Health’s shopping platform to enable employees to budget their health care expenditures and make informed health care decisions based on quality, cost, and convenience.

“Historically, there has been a lack of transparency in health care, but companies such as Life Technologies are providing innovative approaches to change this,” said Giovanni

Colella, M.D, Castlight Health co-founder and CEO. “Their successful Castlight enrollment and usage shows that employees are excited by tools that allow them to take control of their health care.”

Aetna, Mindbloom team to encourage healthier, More Balanced Living Through social Gaming

Aetna and Mindbloom announced a collaboration that will offer Aetna members an enhanced version of Mindbloom’s Life Game™, an online social game for personal wellness. Starting this fall, Aetna members will have access to a new engagement model that uses the science behind social gaming—a unique blend of technology, art and behavioral psychology—to engage people in achieving personal health and wellness goals.

“By incorporating social networking, multimedia, a virtual rewards system and psychology-based gaming mechanics — and making it all accessible through mobile phones, e-mail and social media channels—Mindbloom is bringing the missing ingredient of personal engagement to the wellness equation.”

“Considering that Americans are spending over $200 billion a year on healthy living products and services, but the rates of chronic health conditions and obesity continue to rise, the time is right for a new approach to engaging people in achieving better overall health,” said Kyra Bobinet, MD, MPH, medical director of health and wellness innovation at Aetna. “We think the Mindbloom Life Game will provide a fun, rewarding and effective way for Aetna’s members to make lasting improvements in their physical and emotional well-being.”

Mindbloom is a Seattle-based social media company and the creator of the online Life Game, a personalized wellness application that inspires and helps people to live healthier, more balanced lives. The Life Game helps people focus on many areas of life including: health, spirituality, relationships, leisure, lifestyle, finances, creativity and career. Mindbloom’s players grow and maintain a virtual “life tree” and a forest of their family and friends, earn virtual rewards and most importantly, make progress in their real lives. For an overview of the Life Game, visit www.mindbloom.com/aetna. The Aetna collaboration will involve a significant

CdhC InnoVAtIons CastlIGht health » aetNa » MINdBlooM

Briefs, continued on page 18

Innovations, continued on page 18

as many employers and insurers recognize the gaps in quality, safety, access and affordability within the u.s. health care system, value-based insurance design (VBId) is attracting much attention.

Focusing on Value.

rather than opting for the “one-size-fits-all” solution, value-based insurance design addresses health care costs based on the value of care in relation to individual patients. Fundamentally, this system of cost sharing develops copayments, which are tailored to the evidence-based value of specific services for targeted groups of patients. This method allows for removal of barriers to those essential, high-value health services and alignment of the stakeholder’s incentives, while simultaneously complementing other initiatives in place to improve quality and suppress costs, such as high-deductible consumer-directed health plans and disease management.

“Value-based insurance designs lower cost-sharing and heighten patient adherence to highly effective medical services,” says Niteesh K. Choudhry, Md, Phd, harvard Medical school, Brigham and Women’s hospital. “although value-based insurance designs have been used primarily for prescription drugs, they may be applied to non-drug services, such as chiropractic care which is a potentially cost-saving strategy for the management of low back and neck pain.”

during the Consumer-directed health Care ForuM West, taking place sept. 15-16, 2011, in denver, a featured workshop, “Value Based design Fuels Patient engagement,” sponsored by the Foundation for Chiropractic Progress, a not-for-profit organization dedicated to raising awareness about the many benefits associated with chiropractic care, will explore the functionality of VBId and its documented outcomes in quality enhancement and potentially reduced health spending. In addition, the workshop will highlight that VBId can also be applied to non-pharmaceutical issues, such as chiropractic care and mammography, yielding equivalent results.

Niteesh K. Choudhry will lead the seminar focusing on the findings of the 2010 white paper outcomes-Based Contracting™: The Value-Based approach for optimal

health with Chiropractic services for which he provided guidance.

A tighter Focus—Chiropractic Care. In implementation of a VBId for non-drug services, one

must initially lay the appropriate framework. similar to the structure behind the prescription model, the end result will

yield lower cost sharing and increased medical compliance.

The first is to target a condition, which is common and costly. low back pain is cited by The American Academy of Physical Medicine and Rehabilitation as a leading medical condition affecting 80 percent of americans at some point in their lifetime.

The second is to verify the clinical benefits supported by

high-quality evidence. spinal manipulation, performed by a doctor of chiropractic, was found to be one of the most effective treatments for lBP in a study published in the Annals of Internal Medicine.

Third, the care needs to be proven cost-effective and associated with “value.” In the case of lBP management, dr. Choudhry and arnold Milstein, M.d., MPh authored a 2009 study “do Chiropractic Physician services for treatment of low Back and Neck Pain Improve the Value of health Benefit Plans?,” which concluded chiropractic care could be an effective and cost-efficient service for relief of pain and reduction in disability.

Broadening the use of VBId expands the pool of desired results and yields a win-win scenario for both the employers and patients. Though, further analysis in regard to the application of VBId to non-drug services is needed, there is sufficient rapport constituting the value it can provide. Value-based insurance design fills the gaps in the u.s. health care system and those seeking an alternative will be greatly enthralled by the research presented in Choudhry’s presentation.

during the CdhC solutions ForuM West workshop, sept. 16, 10-11 a.m., Choudhry will walk attendees through virtually each step of value-based insurance design, from the undesirable copayments which leave employers seeking alternatives, to the evidence and framework behind implementing a VBId, and most importantly how VBId can be implemented to all health care options, specifically chiropractic. Choudhry has engaged in similar presentations and has built a reputation in the industry; his workshop is imperative for understanding essential VB planning tools in future markets.

A Value-Based Approach


A D V e R T O R I A L

“Value-based insurance designs lower cost-sharing and heighten patient adherence to highly effective medical services. Although value-based insurance designs have been used primarily for prescription drugs, they may be applied to non-drug services, such as chiropractic care which is a potentially cost-saving strategy for the management of low back and neck pain.”

PeoPle oN the MoVeBRIeFs

enhancement to the Life Game as well as new mobile features.“Most of us recognize the value of maintaining healthy, balanced lives yet we continually

fail to make healthy behaviors a consistent priority. It seems the motivation is there but we can all use a little nudge,” explains Mindbloom’s CEO, Brent Poole. “By incorporating social networking, multimedia, a virtual rewards system and psychology-based gaming mechanics—and making it all accessible through mobile phones, email and social media channels—Mindbloom is bringing the missing ingredient of personal engagement to the wellness equation.”

RxeoB Launches emWellicssM Mobile Platform Connecting health Plans, PBMs to Members

RxEOB has announces the launch of emWellicsSM, a modular mobile platform that connects managed care plans, pharmacy benefit managers (PBMs), and payers “one-to-one” with their members. Leveraging RxEOB’s 10 years of experience deploying member-friendly, pharmacy-oriented web-based solutions for health plans and PBMs, emWellicsSM empowers health plans and PBMs to reach millions of members with their own branded, HIPAA-compliant, mobile application, and to customize their mobile offering with an array of applications. The platform, which supports all mobile operating systems, easily integrates with client-maintained claim, benefits, and eligibility databases or enterprise data warehouses.

“emWellicsSM allows individuals – including Medicare, Medicaid and commercial members—to understand and manage their pharmaceutical benefits through their smartphones,” said Robert Oscar, R.Ph., CEO of RxEOB. “This technology enables consumers to comparatively shop for prescriptions, note allergies, track drug utilization data, learn drug side effects, get directions to doctors’ offices, and prepare for visits. Using a list of pre-loaded visit preparation questions—from medication use to diagnostic test questions—members will experience more productive appointments with their physicians and can easily communicate notes about their discussions to family members and care givers through their smartphones.”

According to the Pew Mobile Access 2010 Report (Internet & American Life Project), 59 percent of all adult Americans—including an increasing percentage of Medicaid

members—go online wirelessly, using the Internet, e-mail, or instant messaging on a cell phone. This study suggests that leveraging mobile technology is an efficient way for state Medicaid plans to connect with patients and offer incentives when using preferred provider sites, promoting adherence to medication regimens, and encouraging the use of Medicaid-assigned primary care physicians.

“Smartphones are changing the way we live, and the emWellicsSM platform is designed to help our customers take the lead in providing smart messaging within the health care marketplace,” Oscar concluded. “Today, virtually every person—from the chronic allergy sufferer to the mother of three—can easily access and manage health information in the palm of their hands.”

hatch Introduces Legislation to strengthen, expand hsAs, FsAs

U.S. Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance Committee, today unveiled the Family and Retirement Health Investment Act of 2011, bicameral legislation to strengthen and expand Health Savings Accounts (HSAs) and flexible spending arrangements (FSAs) for American workers and retirees. Companion legislation was introduced in the U.S. House of Representatives by U.S. Rep. Erik Paulsen (R-Minn.).

“This legislation will provide American workers and retirees with a common-sense way of improving access to quality, affordable health care,” said Hatch. “These health plans empower Americans to take control of their health and well-being. health savings accounts and flexible spending accounts allow consumers to make informed decisions about their health care and will help restrain costs by putting people in charge of their health choices.”

This year health care costs are expected to rise by eight percent, more than double the rate of inflation. HSAs and FSAs provide individuals with opportunities to put away tax free savings for everyday medical expenses. When Congress first made HSAs available, these plans only covered 454,000 lives. Today, more than 10 million people are covered under a health plan that is eligible for an HSA.

The Family and Retirement Health Investment Act of 2011 will streamline these health care products and simplify them for American families, seniors, and entrepreneurs.

with a major It transformation during his time at Blue Cross that has led to new e-business framework, the replacement of a legacy claims system and introduction of payer-based e-rx and personal health records. his professional experience centers on the insurance/financial services industry. Major focuses include information technology, business process engineering and program management development.

healthView services Inc., a technology firm specializing in customized financial planning systems designed to help baby boomers address health care expenses in retirement, has announced Charlie Baker has joined its team as a strategic advisor and a member of the board of directors. Baker will provide strategic insight and assistance in addressing the issues around helping people plan for health care costs on their retirement income. he has spent the past 20 years serving in leadership positions in both the public and private sectors. Best known for his success in turning harvard Pilgrim healthcare into a profitable, competitive organization after it faced bankruptcy, Baker most recently ran for governor of Massachusetts. he secured the republican nomination, but lost the four-way race to incumbent deval Patrick.

univita announces the addition of dr. John Mach, a foremost physician and thought leader in care management. dr. Mach will serve as president and

general manager of univita’s Complex Case Management division. dr. Mach’s 25-year track record as a leading physician and industry expert is built upon an impressive bank of professional experience. as chief medical officer for Xlhealth, he led all clinical program development, medical management and quality improvement efforts in support of Medicare Chronic Illness special Needs Plans. as chairman and chief executive officer for unitedhealth Group’s subsidiary evercare, he led geriatric and special needs clinical programs for the nation’s care management leader for aging, chronically ill and disabled individuals.

Robert W. Pryor, M.d., MBa, FaaP, FCCM, FCCP, began his role as president and Ceo of scott & White healthcare last month. he succeeds Alfred B. Knight, M.d. who has assumed a leadership role as president of the scott & White healthcare Foundation (scott & White’s philanthropic arm). The scott & White healthcare Board of trustees announced selection of dr. Pryor in august 2010. a physician leader with a distinguished career in large group practice management, dr. Pryor, 59, served as chief medical officer of scott & White since 2005 and additionally as chief operating officer since august 2007.

BenefitVision, a leading provider of employee benefit communication, enrollment and data management services, recently announced that Charles


rxeoB » FaMIlY & retIreMeNt health INVestMeNt aCt CdhC InnoVAtIons

Briefs and Innovations, continued from page 15


PeoPle oN the MoVe BRIeFs

schwartz has joined the firm as vice president of enrollment. schwartz’s skills in operational support, metrics, and staff leadership will be the key to helping BenefitVision continue to develop unique solutions for employers to meet today’s complex challenges. schwartz joins BenefitVision after 10 years as a customer service oriented call center executive, working with industries including health care, hr/benefit enrollment, distribution, manufacturing, financial services and electronic publishing. he initiated several new hire training programs, reducing on-ramping time for new hires by 50 percent while improving productivity 100 percent.

WellPoint announced that Meg Rush has been named vice president of consumer experience and e-marketing. In this role, rush will be responsible for leading all e-marketing efforts, customer portal and digital strategy development, and oversight for all consumer experience work, which will include implementing programs to improve consumer involvement with WellPoint and its affiliated health plans. Most recently, rush served as vice president of product management and design for WebMd health services, a market leader in providing health and wellness, consumer decision support and behavioral change solutions.

Kaiser Permanente has announced that Kerry Kohnen has been named president of Kaiser Permanente Georgia. Kohnen will oversee the largest nonprofit health plan in Georgia, which provides comprehensive health care

services to more than 240,000 members through 28 medical facilities and affiliated hospitals in a 28-county service area. With great knowledge of Kaiser Permanente and a solid background in operations and administration, Kohnen will lead the organization’s future growth in the metro atlanta marketplace. Kohnen will assume his new role immediately and will report to donna lynne, Kaiser Permanente group president, who oversees the Colorado, Georgia, Northwest and ohio regions. Kohnen has recently served as senior vice president of operations, for Kaiser Permanente Georgia and has held positions of progressive responsibility since joining the organization in 1975. Kohnen began his career with Kaiser Permanente working at the Panorama City hospital in Panorama City, Calif., following his high school graduation. he has been with the organization for more than 35 years. during his career, Kohnen has held positions within three Permanente Medical Groups and four Kaiser Permanente regions.

Raymond L. Chan, M.d., MBA, has been named a medical director for sCAn health Plan, the country’s fourth largest not-for-profit Medicare advantage plan. dr. Chan is a board-certified family physician and brings to sCaN more than 16 years of experience as a medical director. Most recently he served as the director of clinical services and quality for hill Physicians Medical Group/PrIMed in san ramon, Calif., where he was responsible for improving inpatient utilization and managing network performance over a broad range of products.

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DataPath understands that benefit consultants need plan designs as unique as the employers and families they serve, and a system to process those comprehensive plans. Since 1995, DataPath has led the industry by providing the ability to offer plan designs with embedded deductibles, including multiple HRA and MERP plan designs using an HDHP as overhead coverage.

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TYPE II CERTIFICATION TYPE II CERTIFICATION

SAS70


hsA / fsA / hrABy JoAnn m. lAinGAUtHOr And sPOKesPersOn

Clarity is an important element of any communication situation. Th is is particularly true in creating and disseminating benefi t information. Yet by their very nature, health care benefi ts are

not easily reduced to simple declarative sentences or shorthand bullet points.

Despite eff orts by employers and health care insurance providers, health care benefi ts are more complex now than fi ve years ago. Not surprisingly. As a result of the Health Care Reform Act, the communication challenge is greater and promises to be more so in the near future.

In recent years, costs and other considerations have driven even the largest companies to off er consumer-directed health care (CDHC) options: Health reimbursement accounts (HRA s), fi nancial spending accounts (FSAs) and health savings accounts (HSAs).

The appeal of CDHC off erings is the empowerment of the individual to manage his or her health care spending. If proponents’ theories are correct, CDHC options result in reduced health care provider utilization and, theoretically, lower employer premiums. As the three types of programs gained traction amongst larger corporations, creating its eff ective communication vehicles had new challenges. At fi rst, the test was educating employees to the benefi ts and requirements of HRA s, FSAs and HSAs (launched in 2004), while the last off ering of pension supplemental options, needed to be explained to the new audiences.

In its research over the past fi ve years, Information Strategies Inc. (ISI) interviewed thousands of employees on a variety of issues facing them as they moved to HSAs, either as a total replacement for more traditional plans or as an option. Broadly speaking, the communication issues facing the larger employer fall into three main categories:

n Credibilityn Clarityn Understanding

Credibility: While ebbing, the major impediment to eff ective communication in the years 2005-2010 was credibility. Employees simply did not believe that HSAs were a positive alternative to the company’s more traditional plans. Based on ISI’s interviews and focus groups during the period 2006-2010 there were very negative

feelings toward HSAs amongst employees of larger corporations.Th e principal reason for this negativity, as shown in other parts

of the survey and in focus groups, was a distrust of management’s motives in proposing or adopting HSAs.

Clarity: Ironically, the very simplicity of HSAs made for negative reactions from employees. ISI’s surveys and focus groups for one large employer showed that 39 percent of employees did not believe the provisions and set-asides were as clear-cut as the law provided. Th is trend also was noted in the general overall surveys. Th e ability to keep unused funds until retirement and then utilize them tax free, required careful explanation (something that was not done in many cases and remains to some extent today).

Understanding: Even though HSAs are in their eighth year, basic understanding of the employee’s responsibilities is still unclear

to a majority of respondents of ISI’s 2011 survey. A simple four-part questionnaire created in 2006 and administered each year since to more than 5,000 respondents yearly, demonstrates

the continuing need for education.Over the years, the most valuable avenues for larger employers

to communicate the advantages of HSAs to employees are online portals, which have become more sophisticated and off er a plethora of information and instructions. Th ey are indeed the most important information nexus as we enter the second half of 2011.

ISI advises its clients to use “thought leaders” as a viable and important element in educating employees. It also advises clients to simplify portals and provide telephone assistance wherever possible. Writt en materials should be clear, concise and off er readily understandable examples to build employee trust. One factor that is oft en overlooked is making sure that senior management demonstrates faith in HSAs by participating and becoming active. Finally, with health care reform a major political topic, keep consistent in providing employees with updates on a regular basis in order to maintain credibility and employee buy-in.

JoAnn M. Laing is the author of two books on HSAs, as well as being a leading spokesperson in the CDHC community. She is a Harvard Business School graduate and has been a senior executive with Sara Lee, Olivett i and First Advantage. She can be reached at [email protected].

To see this article in its entirety, please see the online version at www.cdhcsoluinsmag.com.

eliminate Chaos by Communicating the precise message

Average 1,000 respondents of Companies with >500 employees

2006 2007 2008 2009 2010positive 8.0% 9.0% 15.0% 38.0% 48.0%neutral 34.0% 34.0% 23.0% 21.0% 11.0%negative 34.0% 48.0% 31.0% 24.0% 24.0%no opinion 24.0% 9.0% 31.0% 17.0% 17.0%

100.0% 100.0% 100.0% 100.0% 100.0%

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By Jim Christenson, CeBs

Field Vice President » AllstAte Benefits

supplementAl Benefits

employee paid insurance benefits need to be considered in the overall planning for benefit offerings, as many employers have allowed voluntary insurance benefits to be enrolled without

scrutinizing the purchases of their employees. Insurance agents and enrollers have presented a variety of choices

to their employees without consideration to the effect they may have on core insurance benefits.

Choice is good, right? No, not always. Too many choices can be detrimental and overwhelming.

There are a variety of factors for human resources to consider when evaluating voluntary plans. These include:

n Enrollment process n Rate structure affordability n Post-enrollment supportn Reduction in paperwork n Billing and Claimsn Year-round supportn Single or multiple carriers

HR needs to set specific goals for its voluntary offerings. These include enrollment processes and plan participation. Enrollments should never be passive. If it is a benefit, then all employees need to actively decide to accept or reject the offerings. Communication needs to be easily understood, provided in multiple formats and at various pre-arranged times. Voluntary benefits deserve the same effort as core insurance benefits.

In the case of high-deductible health plans, voluntary benefits can be used to strengthen safety nets. The purpose of consumer-driven health insurance is two fold. First, it reduces the cost of coverage making it more affordable, which supports participation. Second, it drives the participants to examine the expenses associated with treatments and medications with the goal of creating consumers rather than users of health care. Voluntary benefits can support or challenge this cause.

Many sickness plans, cancer plans and accident plans contain varying cash benefits that pay in the case of an emergency room visit. These benefits can be stacked, meaning the insured might financially benefit from using the emergency benefit, making it the treatment of choice. Emergency rooms usually provide expensive, lower-quality service and hurt plan utilization. Care should be taken to monitor carriers that propose multiple products to prevent this from happening.

A more positive example of voluntary offerings might lay in Critical Illness insurance. These policies pay a lump-sum benefit for covered illnesses such as heart attack, stroke, and invasive cancer. These policies are available as family plans and pay benefits of $5,000-$50,000 based on the benefit purchased.

Typically, employees purchase $10,000 policies. Critical illness insurance policies can be designed to offer wellness benefits from $25 to $100. The wellness benefits are paid out for a specified list of wellness tests according to the policy. These will generally include commonly required procedures such as PSAs, mammograms, lipid panels, EKGs, and pap smears. Wellness benefits provide the employee with an economic incentive to act on wellness.

Critical Illness insurance provides security to employees that worry about the deductible when they are unable to fully engage because of a dreaded disease. In reality, none of us are going to be able to be thoughtful consumers when we are stricken. Critical illness insurance simply provides a solution to those of us who would be financially challenged by a heart attack or stroke.

Many health plans limit the number of rehabilitation benefits; some as few as 20. In the case of a stroke, that is just the beginning of recovery. A $10,000 check is very helpful in a time of health crisis and will help stave off creditors and pay for services. In the case of qualified high-deductible health plans, check to see if they are compatible with a health savings account, some are.

Disability benefits are overlooked in this process. It is widely assumed that a 60 percent employer-paid plan is adequate coverage. Employer-paid disability insurance plans are taxable, so net income replacement after taxes is below the 50 percent level.

Few of us can afford to be sick and live on less than half of our salaries. Individual disability plans are more expensive than group, but do not offset against the group policy. Replacement percentages can be limited from 25 to 40 percent, so as to not encourage malingering. This allows the employee to have money to continue to pay for benefits even while being disabled.

These are just a few examples of the need to examine and scrutinize voluntary insurance benefit offerings. They should be analyzed periodically and marketed to assure the best products are being offered to employees. Be certain they fit your insurance benefit goals. S

Allstate Benefits is the marketing name for American Heritage Life Insurance Company, a subsidiary of The Allstate Corporation.

Jim Christenson has been in the insurance industry for 24 years, 20 of those years in workplace insurance ben-efits, Section 125 and employee benefits communication. Christenson obtained his Certified Employee Benefit Specialist (CEBS) designation from Wharton School at the University of Pennsylvania in the fall of 1998. Christenson personally enrolled more than 10,000 employees at the worksite and implemented voluntary benefit plans for more than 800 business clients. He has sold voluntary benefits at the worksite through associations, unions, insurance brokers and enrollment firms. He instituted voluntary benefits at the worksite in Malaysia. He has also worked extensively with online enrollments and enrollment systems. Christenson has served as an executive board member of the Workplace Benefits Association since 1998 and as its president in 1999. He is the past president of the Greater Philadelphia Chapter of the International Society of Certified Employee Benefit Specialists.

integrating Voluntary insurance Benefits at the Workplace

NOMINATE & RECOGNIZEINNOVATIVE HEALTH & BENEFITS MANAGERS

Nominate today!

n John J. Robbins Sr., Memorial CEO Leadership Award: To an outstanding leader of any size organization who is an exceptional businessperson, as well as a successful parent and pillar of the community.

n CEO Leadership Award: To an outstanding leader of any size organization, who embraces supports and endorsed an innovative health care or benefi ts program.

n Most Innovative Plan Design Award: To an HR/Benefi ts executive who identifi ed and solved a problem using an innovative health care or benefi ts program.

n Most Effective Plan Implementation Award: To an HR/Benefi ts team that successfully implemented a health care or benefi ts program and exceeded goals or reaped unanticipated awards.

n Most Innovative Employee Education/Communication Award: To an employer, who designed and implemented tools for their employees that exceeded plan participation.

n Most Innovative Employee Empowerment Award: To an employer, who designed and implemented tools that had a high engagement of employee participation in a health care or benefi ts program.

n Most Effective Population Health & Wellness Award: To an employer who uses the most innovative method to reduce absenteeism and chronic disease costs to improve overall employee health.

n Public Policy Leadership Award: An individual who encourages health care consumerism in public policy through legislation.

n Most Effective Solution Provider Award: To a solution provider who introduces the most innovative health care or benefi t solution.

n Most Innovative Partner-Consultant Award; To a consultant who worked most effectively with an HR/Benefi ts team to implement a health care or benefi ts program.

n Most Innovative Broker Award: To a broker, who learned a client’s needs and provided the most effective solution for the employer.

Do you know someone who goes the extra mile? A health and benefi t manager who is a creative problem solver and innovator We’re looking for the industry’s true superstar—professionals in health care and benefi t management, including: solutions providers, brokers, TPAs, employers, benefi ts coordinators, and HR managers, who have excelled at implementing solutions to complex health care benefi ts issues. Superstars to be published December 2011 and will be accessible to more than 70,000 readers.

For details, please visit www.cdhcsolutionsmag.com or www.employersweb.com. Nominations close Sept. 30, 2011. E-mail your Superstar nomination to nominations@fi eldmedia.com or nominate online.

Nomination Categories:500 - 2500 employees 2501 - 7500 employees 7500+ employees


heAlth plAnsBy John reynolDs » PRESIDENT

fis heAlthCAre, GoVernment & Biller solutions

Amidst signifi cant change and turmoil—new insurance plan types, continued downward pressure on provider rates, diminished and sometimes negative margins

for Medicare and Medicaid payments, cost shift ing, increased cost accountability for consumers and limited/dubious quality measurements or controls—U.S. health care costs have continued to rise at unsustainable rates. It is clear that the standard fee-for-service health care model is not working. Th e economic picture, combined with the impetus of health care reform, mandates substantial cost reduction eff orts—and an increased emphasis on the quality of care. Put simply, there is a strong need to create a more competitive U.S. health care market. Enter Accountable Care Organizations (ACOs)—one of the new business models created as a result of health care reform.

Creating a more Competitive u.s. health Care system

Under the ACO approach, physicians and hospitals would band together and take ownership for quality of care and overall annual health care spending for their patients—and, to some degree, would be compensated based on annual performance measures (such as resource use and quality targets). Ultimately, the model is intended to foster collaboration and increased focus on delivering patient value and reducing overall health care costs. Th e ACO concept holds much promise—long-term fi scal responsibility, increased patient safety and quality of care, more equitable cost/compensation models, increased effi ciency and a truly patient-centered focus. However, many obstacles and uncertainties remain. Th ere will be signifi cant infrastructure costs to integrate physicians. Th ere are varying opinions about the rules and implications. And, the return-on-investment (ROI) model remains unproven.

success hinges on engaging ConsumersOne thing is certain; however, the patient must be paramount

in the ACO model for it to be successful. In today’s health care environment, consumers are increasingly responsible for the cost of their own health care—despite the fact that most consumers, as a result of a lifetime of PPO coverage and limited out-of-pocket obligations, have been conditioned not to consider the cost implications of their health care decisions. Reduction of overall health care costs is dependent upon consumers making more thoughtful and economically responsible health care choices. Positive health outcomes are also largely dependent upon consumer behaviors—such as following prescribed treatment protocols and making healthy choices that prevent the onset of chronic disease.

With incentives for positive health outcomes and overall cost reduction, ACOs will need to place signifi cant emphasis on empowering consumers to make informed choices about everything from choosing a health plan, to managing their family’s fi nancial health, to making health care and treatment decisions. Historically, a lack of transparency regarding price and physician quality information has made it challenging for consumers to compare prices and services, and to plan for the cost of their care.

It’s deplorable: Health literacy among Americans is surpris-ingly low, which contributes to an abundance of chronic issues, such as obesity. ACOs must fi nd ways to break down these barriers, and serve a variety of information on cost, benefi ts, quality, wellness, clinical information and more.

Th is information must be served in a fashion that is interactive and engaging, such as: videos, calculators, forums, quizzes, FAQ documents and more. Also, the information must be delivered through the channels that consumers desire—whether online or via mobile avenues. Consumers today are used to having information at their fi ngertips. Right from their mobile device, they can perform a variety of activities—from communicating with friends and family, to interacting via social media and paying bills, to researching almost any subject via the Web. Th ey will have the same expectations for their health care.

With patients’ long-term well-being in mind, portability must also be a key focus. ACOs must arm consumers with tools to manage their health care spending accounts, plan coverage and personal health information—even as they change employers, health insurance plans, fi nancial institutions and physicians.

It’s clear the ACO model has the potential to create positive change in health care delivery and management. New products, technology, administrative and operational platforms, and resources will be critical to support this health care transformation; at the center of the equation stands the consumer (patient). ACOs must not forget about the vital importance of empowering consumers. Indeed, it will be critical to the success of the ACO model.

FIS (NYSE: FIS) is the world’s largest global provider dedicated to banking and payments technologies. With a long history deeply rooted in the fi nancial services sector, FIS serves more than 14,000 institu-tions in over 100 countries. Headquartered in Jacksonville, Fla., FIS employs more than 32,000 people worldwide and holds leadership positions in payment processing and banking solutions, providing soft -ware, services and outsourcing of the technology that drives fi nancial institutions. FIS is ranked 426 on the Fortune 500, is a member of Standard & Poor’s 500® Index and consistently holds a leading ranking in the annual FinTech 100 list. For more information about FIS, visit www.fi sglobal.com. FIS Healthcare Solutions connects patients, providers and payers through an integrated suite of solutions that facilitates the access to and fl ow of information and funds among all three parties. For more informa-tion on FIS’ solutions for health care payments, please visit www.fi sglobal.com/healthcare.

ACos Can’t Aff ord to forget About empowering the Consumer

Prescription drug costs are rising1 — especially brand-name drugs. Yet despite the trends,

Prime Therapeutics has been able to keep our clients’ overall costs consistently low. We

focus on more than just brand discounts. Combined with our generic rate, smarter formulary

management and benefit design, we keep costs down. The proof? Our drug trend result is

below 1%.2 We can help you manage your costs too.

We have the prescription for lower overall costsThe proof is a Prime number

1 Duff, W. “Drug makers raising prices before reform.” NYTimes.com. 15 November 2009. Accessed 20 May 2010. http://www.nytimes.com/2009/11/16/business/16drugprices.html.

2 Prime Therapeutics, Book of Business Data, 2009.

Brand drug costs keep rising, but

My total drug costs rose less than 1%

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presCription Benefits mAnAGement

By lArry Boress » PRESIDENT AND CEO

miDWest Business Group on heAltheViVe heAlth

As employers explore all the opportunities to reduce the cost of their benefi ts without reducing benefi ts, many are looking at the pharmacy arena. A well-designed and managed pharmacy

benefi t package can reduce drug costs, while still improving the health of the covered population. Th e right drugs, taken on a consistent basis, can keep workers, especially those with chronic conditions, out of the hospital and productive at the worksite. Th e right benefi t design and utilization tools can encourage the use of the lowest cost on most eff ective drugs, at the sett ing of greatest convenience.

Th ere are a multitude of approaches that can reduce the cost of pharmacy benefi ts, without negatively impacting the health of those covered. Once an employer examines its data and knows what the high cost and utilization drugs are, there are many types of management tools available. Which ones and how they will be used depends how aggressive the employer is willing to become in their approach.

Benefi t DesignTh rough benefi t design, drugs can be managed by using tiers

for generic, preferred brand, nonpreferred brand and specialty drugs, with increasing cost diff erential between tiers. To maintain the employee’s percent share of costs, move from copays to co-insurance or use a combination approach (i.e. $5 copay on generic, 290 percent co-insurance on brand). Th ere should be a maximum annual or lifetime benefi t, as well as an annual or lifetime cap or limit on out of pocket costs.

Off er maintenance drugs through both retail and mail order sources, and consider requiring maintenance drugs to be purchased for 90-day supply either through mail order or from local pharmacies. Employers may also want to consider operating an on-site pharmacy or have prescription drugs delivered to a kiosk at the work site to save on costs and lost productivity from workers leaving to obtain their prescriptions.

Increasing generic utilization may be considered a low hanging fruit; yet, it can be reached by reducing or eliminating cost sharing for generics, providing coupons for the fi rst generic prescription, and educating employees on the equivalence of generics versus brands. It is also worth considering not covering prescription drugs when there is an eff ective over the counter (OTC) medication available.

Drug management ApproachesTwo key management approaches are: “Step-therapy,” which

requires an employee to sample the most eff ective, lowest cost drug before a higher cost drug can be prescribed and “prior authorization,” which requires approval before a physician can prescribe drugs of high cost or potential abuse. In addition, place limits on the quantity of

certain drugs, especially high-cost specialty drugs, which ensures the patient doesn’t waste drugs by obtaining a 90-day supply and then deciding not to continue on the drug because it’s not eff ective or has side eff ects.

Formulary management can save costs by including only evidence-based, eff ective drugs, with a consideration of limiting one drug per class to a tier. Consider limiting or eliminating “lifestyle” drugs that only treat cosmetic conditions. Price drugs at a “reference” rate and require workers who want to go to pharmacies where the drugs cost above the reference price to pay the diff erence.

Consider reducing your pharmacy network or directly contract one retail pharmacy chain for cost-plus or other discounts on drugs and provide an incentive to use that specifi c pharmacy. Finally, a drug is only benefi cial if it is taken. Th ink about incorporating a compliance program to increase the patient’s use of prescribed medications

specialty DrugsSpecialty drugs, also referred to as “biologics,” are the area of

greatest cost increase in pharmacy benefi ts. Determine how to provide coverage for these drugs. Whether a plan sponsor retains the pharmacy vendor’s specialty program or carves it out to another vendor, ensure that the costs are not greater under the specialty provider as opposed to the retail network. Retail pharmacies ensure customers return by providing a great deal of counseling and dispensing medications on time. With many of these medications requiring refrigeration, the retail pharmacy is an ideal stop rather than receiving shipping from a specialty vendor with the risk of damage in the mail from weather conditions.

performance GuaranteesTh e fi nal key component to an eff ective pharmacy benefi t is to

determine which metrics gauge the performance of the pharmacy benefi t vendor. Possible metrics include generic prescribing and substitution rates, medication compliance on specifi c drugs or classes of drugs, medication possession ratio, mail order utilization, clinical program engagement percent of those enrolled and account and customer service levels.

results are Based on the purchaser’s expectationsAt the end of the day, an employer should get the type of results

it deserves, based on whether the pharmacy benefi t was designed, communicated, managed and evaluated eff ectively. Th e health plan or PBM must be viewed as a partner, not a vendor, and partners need to understand the expectations and capabilities of each other.

pharmacy Benefi t Cost strategies for employers

The Health Reform Navigator helps insurance brokers and consultants answer client questions and benefit managers to quickly respond to issues about the Patient Protection and Affordable Care Act (ObamaCare).

The Health Reform Navigator organizes massive information into a simple searchable format. It provides easy access to actual legislative language, regulations from DOL, HHS, and the Treasury, multiple industry and think tank time lines, and industry surveys on what employers think of reform. You can stay alert to HOT TOPICs, read independent legal and consulting observations, and much more. There are even more than 50 government produced videos and multiple private conference video links.

“The Health Reform Navigator is a great new tool for our readers to get answers to questions that make their jobs easier.”

— Doug Field, CEO FieldMedia

Seeking Direction About Health Care Reform?HealtH RefoRm NavigatoR—Your complete Health Reform Information Center.

It provides an aggregation and “point & click” navigation to information regarding the Patient Protection and Affordable Care Act (PPACA).

a combined $400 value, subscribers can get instant access and a one-year subscription for $99 or $9.99 for a monthly subscription. CDHC Solutions also is offering a one-year subscription for free by signing up for pre-conference event sponsored by Center for Health Transformation. For details please see www.cdhcsolutionsforum.com. Start navigating today. Access your Health Reform Navigatorwww.CDHCSolutionsmag-HRN.com

BoNUS – four for the price of one – Subscribers purchase Health Reform Navigator and also receive four separate Navigators: the insurance Navigator, tax & Penalty Navigator, Preventive Care Navigator and medicare Navigator. Each Navigator is structured with a timeline for when individual sections of the law become effective and each uses the same easy, “point & click” technology to get answers to specific questions about the health care law. Each Navigator also includes direct links to PPACA, regulations, independent legal opinions, and consulting observations. The unique Preventive Care Navigator includes explanations of the USPSTF recommendations, mandated coverages and allowed exclusions, sample SDP language, and CPT codes applicable to each benefit.


Company executives at businesses spanning the country are reassembling their operational strategy to fit a recession-induced “new normal”—one

in which the old ways of doing business are extinct, doing more with less is status quo and doing it faster than ever before is a requisite. This has created a new set of priorities for organizations coping with slower than expected growth, due to the pace of the economic recovery. Businesses are still being careful about taking risks with their resources; in fact, they are looking for ways to spend smarter. These changes have also created a new reality for U.S. workers. They are bearing the brunt of higher productivity expectations

and finally acknowledging that the empty cubicles next to them will remain that way, for now. In many instances, the cost-cutting measures taken by their employer haven’t really been cut, but were instead relocated to employee’s pocketbooks.

Although the blueprint for business operations has been greatly altered, what remains intact is the essential employer-

employee exchange. Business leaders know that in order to achieve new productivity expectations and requirements, they need productive employees. Productive employees deliver tremendous value for their company, but only in return for tangible and intangible value that enhance their lives.

One of the most sought after of these tangible rewards is comprehensive benefits. A company’s benefits offerings are not just held in high regard by employees, they are indicative of how much employees matter, and speak to how well a company delivers on its brand promise.

As company leaders begin to execute

By Audrey TillmAnExEcutivE vicE PrEsidEnt corPoratE sErvicEs

AflAc

“A mere eight percent of

workers strongly agree

they are fully engaged

in making benefits

decisions.”

Benefits’ Rules of Engagement: Better CommuniCAtion EquAls More education


educATion / communicATion

against the “new normal” business plan, they will undoubtedly seek out employee rewards that are essential to the employee value proposition and that are managed tightly to ensure value and cost-effectiveness. Benefits fit such requirements if aligned correctly and delivered effectively.

There is one thing that both employees and the companies they work for agree upon, a lack of engagement when it comes to leveraging and making benefits decisions. This breakdown ignites a costly cycle whereby workers aren’t educated effectively about benefits available to them or that ought to be opted into, creating an unprepared and under-protected workforce, resulting in significant financial implications for both the company and the worker.

The 2011 Aflac WorkForces Report, a study conducted by Harris Interactive on behalf of Aflac, uncovered to what degree workers are “checked out” when it comes to making benefit decisions. A mere eight percent of workers strongly agree they are fully engaged in making benefits decisions, a sentiment shared by their employers. Sixty-three percent of companies agree that workers need to be more engaged in their benefits decisions, and only half of employers feel their employees take full advantage of the benefits they offer.

absence of information vs. adequate advice

Even in the most mundane of tasks, such as ordering dinner from a restaurant menu, a choice isn’t made until all the options have been looked at and considered. A patron would be less than confident taking advice on menu choices from another patron who has never eaten at the restaurant before. Yet, this scenario is playing out at many organizations across the country when it comes to benefits decisions.

Only 40 percent of employees feel extremely/very informed about the benefits offered at their company. This may be in part due to a lack of frequency in communicating information about benefits and their role in financial and health protection.

For example, most companies communicate less than three times a year about benefits, with a small minority (24 percent) doing so three or more times a year. A good number are finding that 44 percent of employees say they receive “too little” communication about benefits from their employer.

In the absence of information, employ-ees are left to turn less-than-ideal sources to gain insight and advice. The majority of workers (61 percent) say they receive infor-mation and/or advice on employee benefits via word of mouth. Specifically, 45 percent of employees say they turn to colleagues and 36 percent toward friends or family.

Without Sound Guidance, cycle of Worker Vulnerability continues

When employees don’t know better, they don’t perform better in terms of adequately protecting their income and their well-being. This leaves many workers underinsured and vulnerable to the financial ramifications of an unplanned for health event. According to the study, little more than half of today’s workers (52 percent) feel protected by their current health insurance coverage. And only 43 percent say their current benefits packages meet their needs extremely or very well.

communication Shortcomings affect retention

A strong business case can be made for improving a company’s benefits communication efforts. The Aflac study found that 41 percent of workers agree they would be less likely to leave their jobs if they were well-informed about their benefits. The turnover cost alone is an incentive to make changes in how and how often an organization shares information about benefits.

A crucial component in shifting the way a company approaches benefit communications is to first acknowledge the possibility that it needs improving. Often, executives have false perceptions. For example, 85 percent of employers believe they are effective at benefits communications. However, more than one-quarter (27 percent) of workers say HR communicates

not very/not at all effectively, and another 39 percent say just somewhat effectively.

Strategies to improve Benefit communication, advice delivery

With more effective communication and a more knowledgeable workforce, companies can reap significant rewards in the form of a healthier, more protected and engaged workforce. Here are some best practices to consider implementing:

Survey Your employeesThe online movement has made

the ability to survey workers much more accessible and at very little cost. Yet, little over half (52 percent) of organizations survey their employees to understand their satisfaction with benefit offerings, and only 43 percent of companies survey their employees’ understanding of benefits communications.

Making assumptions within the realm of benefits and health insurance can be potentially damaging, not only to workers who may feel their needs aren’t being met, but also to a company’s productivity and retention levels.

For example, when it comes to voluntary benefits—an increasingly popular method for companies to offer more options to employees for additional insurance without any direct cost to the company—misinformation and misunderstanding between employers and employees is prevalent.

Many HR decision-makers choose not to add voluntary insurance plans and programs that could help workers with the financial obligations of unexpected health events because they feel their employees don’t have an interest in applying for such options. Nevertheless, survey findings show quite the opposite. Fifty-nine percent of employees say they would be interested in applying for some form of voluntary insurance if they were offered by their employer.

to see this year’s inaugural study results and learn

more on how and where individuals are vulnerable

because of inadequate benefits choices, and how

people can better protect themselves and their

families against the unknown,

visit www.AflacWorkForcesReport.com.


educATion / communicATion

When asked why adding voluntary insurance benefits would be important to them, the top three reasons given were:

n It offers me more options when it comes to health care coverage…

n To meet my needs…n To give me more comprehensive

insurance coverage…

If organizations invest in the resources and time to clearly understand the preferences and needs of their workforce, not only will employees be more satisfied with their benefits packages, but it will help them have greater peace of mind knowing they are adequately protected. With a clearer view as to the knowledge gaps that exist, HR executives can better address communication stopgaps and find ways to make benefits information more robust and accessible.

communicate all Year round, not Just during open enrollment

Too often, employers only communicate their benefits programs to its workers one or two times a year, heaping on the information at open enrollment or at hire. Employees are

already struggling to better understand even the basic health care terms, so expecting them to retain large amounts of benefits information at once is unrealistic and unfair.

Instead, try communicating different segments of your employee benefits program throughout the year. This stands to improve the amount of information employees will retain, as well as make open enrollment a smoother, easier process.

consider retaining a Benefits consultant or Broker

Giving employees the opportunity to talk directly with a benefits advisor or representative from insurance carriers can be incredibly effective in terms of education. Many workers (49 percent) agree they’d be more informed about benefits if they sat with a consultant or broker. Also, health care reform has made the insurance market even more complex, and employees are already seeking greater advice and clarity from their employer.

According to the study, 49 percent of workers strongly agree that “even though I believe health reform is intended to give

me greater control over my health care decisions, I don’t believe I will have greater control because it is too complicated to understand. More than a third (34 percent) of workers say: They will rely more heavily on their employer to educate them about their health care decisions as a result of the health care reform.

With more companies operating with a streamlined staff in their HR departments, keeping up with complicated, ever-changing regulations is difficult and unachievable in most organizations. Partnering with a broker or benefits consultant can also help companies bolster their benefits offerings in a way that won’t greatly impact the bottom line. Brokers and benefits consultants also advise and assist in developing an effective communication strategy and enrollment process.

Companies who use a broker or benefits consultant are more likely to offer more robust benefits, feel their benefits package is more competitive than their industry peers and communicate more often about benefits in their organization.

Communicating well is a tough job no matter how you look at it—particularly when it comes to educating workers about their benefits options. The challenge is for HR executives to make the information as easy and simple for employees to understand so they not only make better choices for their families, but they have greater appreciation for the total compensation package offered by their employer.

HR decision-makers know a benefits package can be influential in an employee’s loyalty (86 percent), work productivity (81 percent), job satisfaction (89 percent) and retention (77 percent). With all that is at stake, implementing a more effective communication and education plan is simply smart business.

Audrey Tillman, a 15-year insurance industry veteran, is Aflac’s executive vice president, corporate services. She is responsible for all aspects of human resource management for Aflac’s more than 4,400 employees. She also oversees operations in the Facilities and Health Services divisions, as well as Corporate Services, Corporate Learning division and Environmental Coordination area. During her tenure, Aflac has received multiple honors from FORTUNE magazine’s 100 Best Companies to Work for, Working Mother magazine’s 100 Best Places for Working Mothers, BusinessWeek’s Best Places to Launch a Career, Training magazine’s Training Top 125 among many others. For more information on Aflac, call 1-800-99AFLAC or visit www.aflacforbusiness.com.

ToTAl PoPulATion HeAlTH

Google the keywords “health care reform,” and you will generate more than 3 million results. Turn on the television, and it is likely you’ll fi nd someone sounding off on the subject.

As the great health care debate rages on, it seems there’s no escaping the topic. Th e only thing that appears certain amidst the lengthy legislation is more uncertainty.

Beneath the confusion; however, one thing remains crystal clear: Th e need for change. When we look at the areas with the greatest need for transformation, shift ing our nation’s focus from disease to prevention continues to rise to the top.

Get Well soon! don’t Wait for Health care reform… Wellness and Prevention Works, now


By Jennifer Bruno, SENIOR DIRECTOR, WellneSS & PreVenTion inc., A JoHnSon & JoHnSon comPAny

Wellness and Prevention Works, now


Wellness in the WorkplaceI won’t argue. Th ere are large parts of this puzzle

that are still highly debatable. But the overarching goal to reduce health care costs by emphasizing preventive care and overall wellness makes perfect sense—it has for a while. Prevention stands on its own merits and would help improve our ailing health care system.

According to the Centers for Disease Control and Prevention, chronic diseases—such as heart disease, cancer and diabetes—are the leading causes of death and disability in the U.S. Th e National Center for Chronic Disease Prevention calls chronic disease the public health challenge of the 21st century and warns that without concerted, strategic intervention, chronic diseases and their risk factors can be expected to cause more harm and be more costly to society. Translate this to the business world, and the prognosis is simple: High risk employees mean higher health care costs.

Luckily, employers are starting to see the light. As primary providers of health benefi ts, they play an important role, not just in the health of their employees—but in the health of our nation. In recent years, many have started to incorporate employee wellness programs into their standard mix of benefi ts in an att empt to prevent and manage chronic diseases, which are among the most expensive of all U.S. health issues. By educating their people and providing the tools they need to prevent common conditions, employers can save lives and money. Prevention has demonstrated to be an eff ective means to reduce costs, improve health and increase productivity. Outcomes like these are just a few of the reasons Johnson & Johnson, a company rooted in prevention, has focused on

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ToTAl PoPulATion HeAlTH

and invested in employee wellness for more than 30 years.

Powerful PreventionJohnson & Johnson was founded on the

very principle of prevention. In 1886, Robert Wood Johnson joined his two brothers to create and market a line of ready-to-use sterile surgical dressings that would prevent infections. Today, 125 years later, they still care as much about preventing disease as they do about treating it.

Th eir commitment to wellness extends beyond the people and customers they serve, to their employee base, as well. Some time ago, they realized prevention is not only the right thing to do, but a sound business investment, too. In fact, they have been making substantial, systematic and eff ective investments in employee health for more than 30 years now, and ever since, it’s yielded steady returns in the forms of healthier, more productive, more committ ed people and signifi cantly lower healthcare costs.

All of their U.S. employees have access to health and wellness programs that are delivered and supported by a skilled team of health professionals. Off erings include on-site fi tness centers or gym membership discounts, nutrition assistance and healthy food choices, lifestyle management, digital health coaching programs and human energy management. Th eir top leadership highly supports the program and encourages a strong culture of health throughout the entire organization, which promotes participation and engagement, and in turn helps generate positive outcomes. Overall, for every dollar they invest in their workers’ health, they see a return of more than $4 in reduced health care costs, lower absenteeism and improved productivity. Th eir health care spending averages four percent below benchmarks for their industry. From 2001 through 2009, they avoided more than $21 million in health care expenditures.

Paying it ForwardWith this internal success as a launch

pad, Johnson & Johnson started Wellness & Prevention in 2008, aiming to take the lessons learned with their own employee health and wellness programs to market and show other companies how they can achieve similar results and make

the world a healthier place—one employee at a time. Today, Wellness & Prevention Inc., along with HealthMedia Inc. and Th e Human Performance Institute Inc., are members of the Johnson & Johnson Family of Health & Performance Companies, which provide science-based, outcomes-driven solutions that cover the full spectrum of population health. Th is includes wellness and prevention, to behavioral health, to help with the understanding of chronic disease.

Rooted in the 30 years of Johnson & Johnson experience in defi ning and building a true Culture of Health, Wellness & Prevention can help employers create a healthier, more productive workforce, while enhancing performance and competitiveness. Already achieving positive results in the areas of productivity and participation, clients are realizing why employee health is—and should be—a true business imperative.

Leading the chargeDespite the negative

connotations that shadow the mere mention of health care reform, the continuing debate is a good thing, if only for the way it’s brought wellness and prevention to the national and global spotlight. Sure—prevention is nothing new, but oddly enough, until health care reform raised the red fl ag, it has been one of the most neglected and overlooked medical methodologies, despite its proven eff ectiveness.

While many employers are watching to see how the health care saga will play out, some companies are taking action,

compelled by the mounting evidence that healthier populations deliver tremendous business value through cost savings, as well as reduced absenteeism and improved turnover. Employers and decision makers are in a unique position to shape, not only the future of health care, but the history of our nation. Th ey can get in front of health care reform and lead the charge to lower health care costs by making prevention a priority and looking at employee wellness not as an expense, but as the investment it truly is. Don’t wait to see how health care reform shakes out. Th e bott om line is a healthier bott om line—and prevention can pave the path to get there—now.

For more information about Johnson & Johnson’s success with employee wellness or for detailed descriptions on the Wellness & Prevention business, please feel fr ee to email: [email protected].


HeAlTH cAre conSumeriSm

it’s a simple idea that the free choice of consumers to purchase goods and services should dictate economic structure. Consumerism is fundamen-

tal to our way of life. Our society is based on this premise, and every experiment in planned economies that stifl e consumerism has failed—including the current structure of company-paid employee benefi ts. When people, not companies, buy benefi ts, three important things happen:

n More effi cient consumptionn Bett er protection for consumersn Costs go down

Let’s look at these a little closer…More efficient consumption

of bene� ts. Today, it is axiomatic that employer-selected and purchased insurance—the one-size-fi ts-all approach—is the least effi cient way to buy and consume medical and other insurance. In a recent

study of more than 3 million individual health insurance policies, the average cost of purchased insurance was $2,613 for an individual policy and $5,799 for a family, which is 42 and 52 percent less respectively than the average employer-paid health insurance cost of $4,476 per individual and $12,108 per family. Th is shows that when consumers have control they routinely choose lower cost options.

Th ere is signifi cant variability among health insurance plans that individuals pur-chase on the open market across all major benefi t design criteria. Th ere are also sig-nifi cant diff erences in the plans that people purchase compared to plans that companies purchase for their employees. Specifi cally, group plans have less variability and signifi -cantly “richer” coverage than the plans that people voluntarily choose.

By examining essentially a natural experiment, the actual purchases of more

than 3 million health insurance policies, it is clear that people purchase a wide range of health insurance policies in the open market to meet their clearly diff ering needs. On all criteria analyzed, there is far more variety than in group insurance off erings, and most remarkable, individuals in the open market choose health insurance that is substantially less expensive and assume a correspondingly higher fi nancial risk than the plans employers choose to purchase and off er to their employees. (See graph.)

People are be� er protected against the range of risks they actually face.Among the myriad problems with the current employee benefi ts system—the costs spiraling out of control, the lack of any meaningful choice, the failed broker model that rewards relationships over

By ASHoK SuBrAmAniAnCEO, liAZon

consumerism Lowers Benefi ts costsit’s a simple idea that the free choice

of consumers to purchase goods and services should dictate economic structure. Consumerism is fundamen-

tal to our way of life. Our society is based


solutions—perhaps the most serious and insidious problem is the excessive emphasis on medical insurance. It is estimated that 75 to 80 percent of employees who are covered under an employer-selected plan are overinsured for medical risk… and underinsured for other risks that are not covered by the medical policy. Cost associated with a critical illness, for example, may include the need to travel for treatment or have family come into town. A medical policy doesn’t cover this. It would be easy to blame this imbalance on the recent/current debate over health care reform, but that would ignore the fact that for decades medical insurance has dominated the discussion and has been treated as the primary decision by employers and employees.

Th e reasons for this are obvious. For many, the terms “benefi ts” and “medical insurance” have become interchangeable. In fact, in smaller companies medical insurance may be the only employee benefi t off ered. But even for larger companies, the idea of “rich benefi ts” is prett y much predicated on the expense of the medical

plan. Considering those costs, medical insurance is the 800-pound gorilla that dwarfs all other benefi ts and leads most of the conversations. In our company-paid, copay-oriented world, we have developed the distorted view that we can, and need to, cover every scrape or sniffl e—instead of using insurance as it was intended, to

cover the expensive and unexpected—this att itude all but guarantees that employees will be overinsured for medical. We should also not underestimate the infl uence of the traditional insurance broker who makes the most money on medical insurance and who fi nds it easier to sell employees one type of insurance rather than many.

Medical insurance is simply that, insurance. It has its place. In a true consumer model for employee benefi ts, it has a signifi cant role in what can be called a “balanced benefi ts portfolio.” Such a portfolio att empts to acknowledge and

anticipate the various risks a consumer faces and then rightsize the insurance to mitigate those risks. Th e design to create overinsured employees is made to leave consumers vulnerable in other areas.

We have to keep in mind that buying insurance, especially in a consumer-oriented benefi ts program, means the employee is

buying protection for his or her income, savings and lifestyle, should something happen. Th ough some of the things that might happen could require medical att ention, that is only part of it—people can’t simply cover their medical needs and simultaneously be safe. Th e balanced benefi ts portfolio is made-up of many types of insurances to address diff erent needs, concerns and risks.

Costs go down. So many models start by lowering what the employer pays and then producing a cost-sharing, coverage-lowering solution that “does the least harm” to employees. In a consumer-centric model the tables are turned, employees are empowered to buy their own insurance and they consume benefi ts more effi ciently. With a personalized portfolio of benefi ts, they are happy to see they are more appropriately covered for the range of risks they may face. With these results, it is possible for employers to uncouple what they spend from the impact on employees. With the ineffi ciencies taken out of the system, the employer can now comfortably set the benefi ts budget at a more aff ordable level and be confi dent that the employees will be happy, well protected and in control.

As a Towers-Watson study concluded, “… a win-win solution is possible with the right approach—one that eff ectively aligns the interests of employers and employees to manage the demand for and use of health care.”

Benefi ts consumerism is about trans-forming benefi ts by putt ing economic pur-chasing power and decision making in the hands of participants. It’s about supplying the information and decision support tools need-ed, along with fi nancial incentives, rewards and other benefi ts that encourage personal involvement in altering health and health care purchasing behaviors, plus; all that drives costs out of the system.

Ashok Subramanian was formerly an associate principal in the New York, NY offi ce of McKinsey and Company, a leading global management consulting fi rm. In his 5+ years with McKinsey, Subramanian served as a leader in the fi rm’s healthcare, consumer products, and private equity practices. Subramanian is a graduate of Princeton University (AB), Stanford University (MA), and the Stanford Graduate School of Business (MBA), where he graduated as an Arjay Miller Scholar.

Employers

Employees

Peop

le

Costs

“…a win-win solution is possible with the right approach—

one that effectively aligns the interests of employers and

employees to manage the

demand for and use of health care.”

Enjoy a healthier HSA with Alliant Credit UnionOur Health Savings Account (HSA) protects your company’s bottom line and takes better care of your employeesThe Alliant HSA makes your health care benefit a win/win for your company and employees. We help large national employ-ers offer a best-in-class HSA program at no cost to the company or employees. Plus, we have a track record of providing HR professionals with best-in-class service and communication support.

With a high rate of return, easy access to funds, and without the costly fees other providers charge, our HSA is designed to help employees earn more and save more money faster.

Put your health care benefits on a wellness plan with an Alliant HSA.

Learn more now at www.alliantatwork.com or contact Angela Gambino

• [email protected] • 800-328-1935 ext. 2067

Want tips to implement or fine-tune your HSA program? Download a free copy of our “Is an HDHP/HSA the right prescription for your company?” white paper at www.alliantatwork.com

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United States Government

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SEG420-R0611 CDHC ad.indd 1 6/1/11 5:00 PM

An HDHP/HSA Could be Best Medicine for Employer’s Health Plan

Health care coverage has long been the foundation of an employee bene� t o� ering; a symbol of an employer’s commitment to their employees, as well as a tool to a� ract and retain top talent. As health care costs rise exponentially, employers are faced with the challenge of re-thinking their o� ering. Many employers are asking, “Should I stay or should I pay?” Meaning, should they continue to stay in the game of o� ering health insurance, or should they just give their employees a stipend to pay for their own insurance. As employers grapple with these questions, it’s important they consider the option of o� ering a high deductible health plan with a health savings account (HDHP/HSA).

On its own, an HDHP does not seem like much of a bene� t—even its name makes some wince. But when you consider the HDHP partner—the HSA—the value proposition changes considerably. Only individuals with an HDHP can open an HSA, but why would they want to? HSAs are the only account with a triple tax advantage. Money goes into the account tax free, accumulates in the account tax free, and can be used for quali� ed medical expenses—for the lifetime of the individual—tax free! In fact, employees can even use their HSA funds to pay for COBRA, or their health care during retirement.

It’s di� cult for an employer to e� ectively communicate the alphabet soup of bene� ts. FSA, HDHP, HSA, PPO, HMO, HRA, and the list goes on….Working with a partner who can assist with the strategic adoption of an HDHP/HSA for your employees is critical to the success of your program. � e silent partner to the rising cost of health care will be the cost of employee retention if your bene� t o� ering is not understood for the value that’s o� ered. Alliant at Work can be that partner.

As a custodian for HSAs, Alliant Credit Union remains vigilant in staying current on the impact of health care reform on HSAs. It is reasonable to assume that HSA rules and regulations will be impacted as the details of the A� ordable Care Act are de� ned. All health care is part of this discussion, no one plan is immune. Health care reform strategists are looking for ways to encourage healthier consumer behavior and more though� ul health spending. � e HSA accomplishes both goals.

Alliant Credit Union is a leader in HSAs. We help large national employers o� er a best-in-class HSA program at no cost to the company or employees. Plus, we have a track record of providing exceptional service, communication support and can help with HSA adoption and satisfaction.

By partnering with Alliant Credit Union, you can o� er your employees a high-value bene� t that o� ers a high rate of return and easy access to funds without the costly fees other providers charge.

Want tips to implement or � ne-tune your HSA program? Download a free copy of our “Is an HDHP/HSA the right prescription for your company?” white paper at www.alliantatwork.com.

Alliant Credit Union • 773-462-2256 • [email protected]

Kathy Hall, National Manager

of Sponsor & Member Benefi ts

CDHC Solutions introduces a new feature called “Innovation Showcase.” � is is where leading Innovators have the opportunity to share innovations they have produced that are enhancing health care consumerism and inspiring employers to be� er educate and inform their employee population to become be� er consumers of health care. � ese solutions can be through be� er health bene� ts o� ering, education and communication programs, health and wellness programs, pharmacy bene� t management programs, rewards and incentives, transparency solutions and o� ering supplemental health bene� ts.

INNOVATION SHOWCASE


Enjoy a healthier HSA with Alliant Credit UnionOur Health Savings Account (HSA) protects your company’s bottom line and takes better care of your employeesThe Alliant HSA makes your health care benefit a win/win for your company and employees. We help large national employ-ers offer a best-in-class HSA program at no cost to the company or employees. Plus, we have a track record of providing HR professionals with best-in-class service and communication support.

With a high rate of return, easy access to funds, and without the costly fees other providers charge, our HSA is designed to help employees earn more and save more money faster.

Put your health care benefits on a wellness plan with an Alliant HSA.

Learn more now at www.alliantatwork.com or contact Angela Gambino

• [email protected] • 800-328-1935 ext. 2067

Want tips to implement or fine-tune your HSA program? Download a free copy of our “Is an HDHP/HSA the right prescription for your company?” white paper at www.alliantatwork.com

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©2011 Alliant Credit Union. All Rights Reserved. SEG420-R06/11

SEG420-R0611 CDHC ad.indd 1 6/1/11 5:00 PM

All Pharmacy Benefits Management companies are not the same. Envision Pharmaceutical Services is truly as different from other PBMs as an apple is to an orange. Are you getting what you expect from your PBM? Is your PBM telling you that it’s an apple when it is really an orange?

With Envisions’s Transparent 100% pass-through and fully auditable business model, an apple is truly an apple.

Envision’s guiding philosophy is simple – focus on quality, safety and lowest net cost for our clients. We contractually guarantee 100% pass-through on all pharmaceutical manufacturer rebates, administration fees and pharmacy network discounts to the plan sponsor at the point of sale.

We offer PBM solutions for health plans, hospital systems, employer groups (ERISA), Taft-Hartley Funds, government agencies, prescription savings program sponsors for the uninsured, and others. We have expertise in Medicare Part D administration, including Retiree Drug Subsidy (RDS) and Employer Group Waiver Plans (EGWP). We offer PBM services for one flat management fee.

Learn Why Envision is at the Core of Pharmacy Benefits.

For details, visit www.envisionrx.com or call 1-800-361-4542.

Providing Complete Transparency, Full Disclosure key in Choosing Best PBM

Envision Pharmaceutical Services was created in 2001 by experienced and knowledgeable managed care and pharmacy bene� t professionals who wanted to lead the industry in a new direction and provide complete transparency with full disclosure and point-of-sale rebate technology.

Envision is the only PBM that contractually guarantees 100 percent of all pharmaceutical manufacturer rebates (access, volume and incentive) and discounts will be passed back to the employer/payer at the point-of-sale. Any market share rebates earned through formulary compliance are forwarded to the employer/payer when they are received from the manufacturer.

Envision Pharmaceutical knows there are six critical areas in which the choice of the right pharmacy bene� t management (PBM) company can make a signi� cant di� erence for plan sponsors.

� The first is driving a lower-cost drug mix whenever possible. For every one percent increase in the generic fill rate, there is a corresponding one percent or more decrease in plan cost.

� A PBM should maximize therapy adherence in key drug classes. This is critical to sustaining the member’s health and preventing serious and costly medical problems.

� PBM should also encourage the greatest use of the most cost-effective delivery channel.� Ensuring uncompromising safety.� Promoting home delivery because home delivery is a “gateway” behavior that leads to other outcomes plan sponsors

care about: better drug mix, improved therapy adherence, higher dispensing accuracy and greater member satisfaction.

� And finally, a PBM should ensure that members are engaged and satisfied with the benefit plan. When members are engaged, they are more likely to read communications, participate in educational programs, and respond to calls to action.

Envision’s Business Model:� e methodology that Envision developed to administer their point of sale rebate program is currently patent-pending

and under review by the U.S. Patent O� ce. Envision does not accept disease management or educational grants from pharmaceutical manufacturers or sell client data. Envision’s goal is to link the employer or payer directly to the manufacturer or other provider to obtain such services. � is strategy ensures that 100 percent of all funds for these special programs are used for the bene� t of the payer and eliminates Envision from retaining any fees currently collected by traditional PBMs.

Envision charges a � at fee, per employee (including dependents) per month for all services rendered. � is clarity and transparency in pricing makes Envision unique in the PBM industry. � eir mission statement is: “Envision will continue to lead the industry in a new direction through innovation, superior products, service and quality and stay positioned at the forefront of change in the PBM industry.”

� e Envision business model has received a “preferred vendor” endorsement from the National Business Coalition on Health (NBCH), and has been awarded dual certi� cation from the Utilization Review Accreditation Commission (URAC). � e accreditation process involved a thorough examination of Envision’s practices and policies and an on-site veri� cation process.

Envision was approved as a Medicare Drug Discount Card provider for CMS in 2004 and approved to be a Prescription Drug Provider for Medicare Part D in 2007 through its a� liated company, Envision Insurance Company Inc. Envision currently provides Part D bene� ts management and reporting for several Medicare Advantage Drug Plans and Employer Group Waiver Drug Plans (EGWP) and is fully compliant with all CMS reporting requirements. Additionally, Envision Insurance Company provides individuals with a Medicare Part D Prescription Drug Plan available nationally.

Envision internally manages all of the Pharmacy Bene� t Management (PBM) functions needed by a client. Services are provided on a per employee per month (PEPM) administrative fee basis and includes:

� Implementation� Benefit Design� Enrollment and Eligibility� Retail, Mail Order, and Specialty Provider Network Contracting� Drug Utilization Review

INNOVATION SHOWCASE


TRANSPARENCYAll Pharmacy Benefits Management companies are not the same. Envision Pharmaceutical Services is truly as different from other PBMs as an apple is to an orange. Are you getting what you expect from your PBM? Is your PBM telling you that it’s an apple when it is really an orange?

With Envisions’s Transparent 100% pass-through and fully auditable business model, an apple is truly an apple.

Envision’s guiding philosophy is simple – focus on quality, safety and lowest net cost for our clients. We contractually guarantee 100% pass-through on all pharmaceutical manufacturer rebates, administration fees and pharmacy network discounts to the plan sponsor at the point of sale.

We offer PBM solutions for health plans, hospital systems, employer groups (ERISA), Taft-Hartley Funds, government agencies, prescription savings program sponsors for the uninsured, and others. We have expertise in Medicare Part D administration, including Retiree Drug Subsidy (RDS) and Employer Group Waiver Plans (EGWP). We offer PBM services for one flat management fee.

Learn Why Envision is at the Core of Pharmacy Benefits.

For details, visit www.envisionrx.com or call 1-800-361-4542.

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BEST BUY® GIFT CARDS GIVE EMPLOYEES SOMETHING TO WORK (OUT) FOR

OFFER A LITTLE DESSERT WITH YOUR HEALTH AND WELLNESS PROGRAMThe secret to keeping your employees focused on their wellness is right in front of you. Best Buy Gi� Cards not only have the power to promote wellness programs like smoking cessation and weight loss, they’re also a great way to congratulate and say thank you, with stuff they really want.

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S E T A N D S U R P A S S

Reaching Wellness Goals with a Healthy Dose of Incentives

� e Problem: Maintaining MotivationHealth and wellness continues to be a signi� cant goal for innovative companies. However, garnering

participation for workplace wellness can be a daunting task. Beyond a supportive approach, how can program managers keep employees motivated along each step of the way toward be� er health?

� e Solution: Get Pumped Up With IncentivesInspiration doesn’t have to be big to carry weight in a wellness initiative. � e power of a gi� card incentive

could be more signi� cant to participants’ behavior than you think. Gi� card incentives allow you to recognize and reward lifestyle changes like healthier diets and � tness improvements. Best Buy Gi� Cards, for example, amplify your appreciation by adding to the value of wellness. An incentive is one more reason, beyond an improvement in health, for participants to actively continue and engage in a program. Whether facing demanding objectives or a low budget, incentives can help you boost interest and enthusiasm from start to � nish.

Nonetheless, the role of rewards in motivating participants makes choosing the right incentive key to wellness success. In most cases, but especially when dealing with health and wellness, the incentive should reinforce the goals of the program. Best Buy Gi� Cards allow recipients to choose their own rewards that encourage fun, play and an active lifestyle. From movement-based game consoles to MP3 players and heart rate monitors, Best Buy Gi� Cards put the reward of play right in the hands of your recipients. A truly meaningful incentive not only moves employees to action, it encourages them to continually improve their habits and choose healthier behavior.

Pace Your IncentivesO� ering a grand prize is a great way to generate interest in the beginning, but rewarding smaller goals

along the way can keep employees engaged. Gi� cards can motivate employees and members to continue participating in a wellness program weeks into it. Many companies choose gi� cards as an added bene� t of joining a smoking cessation or weight loss program. An additional reason to participate, like a gi� card, has the ability to continue the journey toward healthier living.

� is form of encouragement shows your support and appreciation while promoting persistence. Gi� cards also allow recipients to choose the reward that motivates them, and continues to remind them of success. � is “trophy value” of a gi� card lets your employees remember and feel proud of their accomplishment each time they use the product redeemed from their reward.

Easy to Use, Easy to EnjoyUltimately, the incentive you choose should be as rewarding for you as it is for the recipient. Best Buy Gi�

Card Incentives are easy to give and easy to use. Best Buy ful� lls orders quickly and o� ers multiple shipping options. Visit CorporateGi� Cards.BestBuy.com for more information on how to qualify for free shipping and discounts. Best Buy Gi� Cards have no expiration date, no dormancy fees and the cards retain their full balance until used.

When designing your wellness program, include incentives that support healthy behavior and reward goal reaching. Whether your organization’s goal is to increase employee engagement or lower their cholesterol, gi� cards as incentives provide one more reason to be healthy. � ey are a way to further exemplify your support and encouragement.

Visit CorporateGiftCards.BestBuy.com or call (877) 370-1234.

INNOVATION SHOWCASE


ADVERTISER: Best Buy AGENCY: SCHERMER AD TITLE: Health and Wellness PUB: CDHC Solutions TRIM: 8.125" x 10.875" BLEED: .125" SAFETY: .25"

NO FEES.NO EXPIRATION DATES.JUST HAPPINESS.™

BEST BUY® GIFT CARDS GIVE EMPLOYEES SOMETHING TO WORK (OUT) FOR

OFFER A LITTLE DESSERT WITH YOUR HEALTH AND WELLNESS PROGRAMThe secret to keeping your employees focused on their wellness is right in front of you. Best Buy Gi� Cards not only have the power to promote wellness programs like smoking cessation and weight loss, they’re also a great way to congratulate and say thank you, with stuff they really want.

Learn more at 877-370-1234 | Gi� [email protected] | CorporateGi� Cards.BestBuy.com/CDHC

BEST BUY, the BEST BUY logo and the tag design are trademarks of BBY Solutions, Inc. © 2011 BBY Solutions, Inc. All Rights Reserved. 10528


By Grace-Marie Turner » PresIdent Galen insTiTuTe

The outrageous distortions about the ryan Medicare reform plan are coming from people who are accelerating the program’s path to insolvency.

Medicare is being used as a piggy bank by democrats, with $575 billion in payment cuts used to finance two massive new entitlement programs in ObamaCare. And this April, the president proposed taking another $480 billion out of the program to lower the deficit.

Payments to providers will be cut so deeply that seniors will find it harder and harder to get care. doctors will stop taking Medicare

or go bankrupt. A whopping 87 percent of doctors say they will stop seeing or will restrict the number of Medicare patients they see, further shrinking the pool of providers and further restricting access to care.

The powerful, 15-member Independent Payment Advisory Board will use price controls to meet ever-elusive spending targets. rationing is inevitable, especially of newer medicines and technologies.

House energy and Commerce Chairman Fred Upton (r-Mich.) explained, “Last year, Medicare expenditures reached $523 billion, but the income was only $486 billion—leaving a $37 billion deficit in just one year. And with 10,000 new individuals becoming eligible each day, it’s only going to get worse.”

Medicare is $38 trillion in the red, and it accelerated five years toward insolvency in just the last year, according to the Medicare trustees’ latest report.

sen. Marco rubio (r-Fla.) captured it best in a new video, saying “Medicare will go broke in as little as nine years... And anyone who is in favor of doing nothing to deal with this fact is in favor of bankrupting it.”

House Budget Chairman Paul ryan (r-Wis.) recognized that reality with his plan to begin modernizing the program, starting 10 years from now. He wants to give baby boomers the option of private coverage in a plan that works much like the one members of Congress have today.

Access to coverage would be guaranteed, and payments would be tailored to meet a person’s age, health status, and income level.

Medicare is a government-run, politically driven health care

program with so many gaps that people have to buy supplementary coverage. not surprisingly, one fourth of today’s seniors have voluntarily decided to opt-out of traditional Medicare by joining private plans in Medicare Advantage.

These plans are competing for their business, offering better benefits often at lower costs to beneficiaries.

rather than slashing this popular program as ObamaCare does, it should be put on an equal and sound financial footing to continue to give seniors choices in the future. This model of seniors selecting from

competing private plans is what Paul ryan is proposing 10 years hence with premium-support payment to help pay for the cost of that plan.

Here are the facts of the ryan plan: Paul ryan’s plan does keep the payment reductions in Medicare under current law for 10 years, but he doesn’t use them to create two massive new entitlement programs.

Beginning in 2022, beneficiaries are guaranteed a choice among Medicare-approved private health options. As the Congressional Budget Office notes: “Plans would have to issue insurance to all people eligible for Medicare who applied.” In other words, all Medicare beneficiaries are guaranteed that a health plan will be available for them.

This is in stark contrast to what would happen to Medicare under the current law.

Without a serious course adjustment, Medicare will become a third-rate, price-controlled program that rations a lower quality of care through waiting lines and other restrictions.

If the antiquated, open-ended, fee-for-service model isn’t reformed, then we will continue to pour deficit-funded dollars into the program or raise taxes to levels that would topple the economy as millions of baby boomers hit retirement.

The only way to save Medicare is to change it.

Grace-Marie Turner is president of the Galen Institute, a research organization focusing on free-market health reform. She is co-author of Why ObamaCare Is Wrong for America (Broadside/HarperCollins).

There’s No Choice But Change

ask TheexperT

If the antiquated, open-ended, fee-for-service model isn’t reformed, then we will continue to pour deficit-funded dollars into the program or raise taxes to levels that would topple the economy as millions of baby boomers hit retirement.


sTaTisTics & DaTaHeALtH CAre reFOrM

employers invest in health benefits to recruit and retain top talent. While providing health benefits may affect employee health and company cost-effectiveness, if it fails to satisfy existing employees

or impress recruits, it is not a good value to employers because it did not contribute to their ultimate talent recruitment goal. The preeminence of that goal is why employers largely abandoned restrictive models of managed care in the 1990s, even though these models arguably had some success controlling the growth in health insurance costs. Once HMOs inspired more grumbling from employees than satisfaction, employers discarded them.

Consumer-directed health care (CdHC) will suffer the same fate as HMOs if it is not structured to satisfy employees. While employers will appreciate the cost-saving benefits of CdHC in the short run, if CdHC inspires a new round of employee complaints and undercuts the competi-tiveness of recruitment, employers will discontinue them without a second thought.

The foremost problem employees and employers face in implementing CdHC plans is the stunning lack of transparency in the health care system. typically CdHC focuses transparency reforms on pricing and attempts to share price information with consumers. However, price is only one side of the shopping equation; consumers also care about the quality of services they seek. But unlike the markets for other goods and services, health care quality is not correlated with price. It is mistaken to assume a high-cost provider achieves better outcomes than a low-cost provider.

It is especially hard when we know that quality—risks of mortality, risks of infection, and whether hospitals follow medical guidelines—varies sig-nificantly from hospital to hospital, even for hospitals within the same health system. For example, based on the 2010 Leapfrog Hospital survey data, we know within a single state, the chance of obtaining a hospital-acquired condi-tion can double from one hospital to the next. Furthermore, in the same state, we know there is a 10 percent greater chance of mortality during a common surgical procedure at one hospital compared to others in the state.

Transparency is criticaltransparency was front and center for the employers who founded

the nonprofit Leapfrog Group in 2000, and the progress they made since then could be an important tool to facilitate CdHC. employers covering over 32 million lives, including GM, Ge, Boeing and others, sought a health system in which hospitals competed on the right performance metrics. today the Leapfrog Hospital survey is completed by more than 1,200 hospitals across the country and used by hundreds of medium and large purchasers to educate employees and structure benefits design and contracting.

Leapfrog is an especially good fit for the CdHC movement. since Leapfrog’s purchaser members guard the authority to determine the content, scoring and reporting rules of the survey, it is hardwired to deliver the most relevant information employers seek. This contrasts with a flurry of report cards and websites purporting to support transparency that have emerged in the wake of Leapfrog’s seismic stake in the ground during the early 2000s. Websites like CMs’ Hospital Compare and many state reporting initiatives are influenced by the need to satisfy a variety of interest groups

and often obscure differences in performance in order to avoid offending providers. Other public reporting sites emphasize issues consumers do not understand how to use, such as whether a hospital administers aspirin upon arrival at the emergency room. In contrast, more critical to consumers is the hospital’s infection rate and the likelihood of survival for certain heart procedures.

Leapfrog reports annually on three main issues:1. How patients fare at hospitals, including: infection rates,

complications and mortality.2. resources used to care for those patients: length of stay and

readmission rates for certain conditions.3. Management practices that promote safety: whether the hospital

has in place the systems necessary to sustain and hardwire safety into the organization.

Leapfrog uses a “cell-phone bar” display to help consumers differentiate between high and low-performing hospitals. Hospitals that receive one bar have room for improvement, and hospitals that receive four bars fully meet Leapfrog’s high standards for that category. Leapfrog makes more detailed information available whenever possible; for example, within the reduce ICU Infections section, consumers can identify the hospital’s infection rate by ICU type. Anyone with a computer can access this information for free on the Web at www.leapfroggroup.org/cp. Below are three examples on how CdHC could benefit from Leapfrog as one transparency tool.

example 1: survival predictorsLeapfrog pioneered the use of survival predictors, which (unlike

observed mortality rates) offer a scientifically validated prediction of a patient’s likelihood of surviving a particular procedure at a particular hospital. Leapfrog’s measures use a combination of volume (the number of procedures annually performed at the hospital) and observed mortality to forecast the chances of a patient’s survival. The best hospitals (the hospitals with the highest chances of survival) are those hospitals that have a low observed mortality rate and do many of the procedures.

In 2008, Leapfrog adopted measures that predict the likelihood of survival for six different procedures. All six of Leapfrog’s survival predictors have been modeled and reviewed in three peer-reviewed studies that found significant predictive value. The measures are critical tools for consumers trying to pick a hospital, because they reveal stunning differences in the chances of survival:

n For pancreatic resection, the best hospital has close to a 100 percent chance of survival, but the worst hospital has less than an 80 percent chance of survival.

n the results for esophageal resection are similarly dramatic. At the best hospital, patients have a 97 percent chance of survival; at the worst hospital, patients have only close to an 87 percent chance of survival.

Transparency: The Key to Sustaining the Consumer-Director Health Care Movement

By leah BinDer anD WilliaM roBinson

Statistics & Data, continued on page 46


HeALtH CAre reFOrMsTaTisTics & DaTa

see the charts above for hospital performance over the last two years for both conditions. The charts report the forecasted chance of death (“predicted mortality”), which is calculated by subtracting the predicted rate of survival from 100 percent. Leapfrog publically reports all of this information, by hospital, on www.leapfroggroup.org/cp.

example 2: elective Deliveries In 2009, Leapfrog added a measure on hospital surveys that asked

hospitals to report the rate of babies electively delivered for no medical reason—whether by C-section or induction—between the 37th and 39th completed week of gestation. Pregnant women are wise to consider this data before delivery. early elective deliveries put both mothers and babies at unnecessary risk: mothers electively induced early have a significantly higher risk of needing a C-section, and babies electively delivered early are at greater risk for series health problems and being admitted to neonatal intensive care.

In January of 2011, Leapfrog, in coordination with the advocacy groups March of dimes and Childbirth Connection, and four major health insurance plans, conducted an advocacy campaign to alert the public, that early elective deliveries were happening at an alarming rate. Based on 2010 Leapfrog Hospital survey results, on average 17 percent of babies delivered between the 37th and 39th week of gestation are done so without a medical indication. There was wide variation in hospital performance (see chart below); hospital rates of early elective deliveries ranged from zero percent to more than 70 percent. roughly one-half (53 percent) of reporting hospitals met Leapfrog’s 2010 performance threshold of 12 percent. Because of this year’s performance and recommendations from the measure advisory committee, lowering the standard to 5 percent in 2011 is projected.

example 3: central line infectionsCentral line-associated bloodstream infections (CLABsI) are a type

of hospital-acquired infection that affects catheters (central lines) placed

into large veins leading to the heart. Central lines are used to administer medications and conduct tests, among other things, and are usually only placed in very sick patients; they are most common in intensive care units (ICUs). The infections are common, deadly, costly and preventable. It is estimated that roughly 18 percent of those people who contract CLABsI die; and, additional costs associated with caring for someone with a central line infection can range from $3,000 to $29,000. Many hospitals have reduced the number of these infections to zero.

In 2010, using the same approach as the CdC, Leapfrog began reporting a standardized infection ratio (sIr) for CLABsI. Hospitals with a sIr over one have more infections on average than their peers, and hospitals with sIr of less than one have fewer infections on average than their peers. Based on the 2010 Leapfrog Hospital survey data, CLABsIs are still prevalent in American hospitals, and there is wide variation among hospitals

and among states as a whole (see chart). The variation is serious enough to warrant careful consideration by consumers before agreeing to be admitted to a hospital.

In light of the fact that not all health care is created equal, how can CdHC plans sustain employee satisfaction and promote better health decision making? The key is ensuring that employees have easy-to-use and actionable tools to feel confident when shopping for health services. Indeed, the competence of employees as “shoppers” is the strength of the consumer-directed health plan model. supportive policymakers appreciate that CdHC could potentially revolutionize the quality and cost-effectiveness of health care by applying basic market principles to the industry. But unless employees feel comfortable as shoppers, employers will abandon the model. Indeed, it is worthwhile for advocates of CdHC to step back and consider pioneering efforts, such as Leapfrog and others, which help support consumer decision making.

Statistics & Data, continued from page 45

Distribution of Elective Delivery Rates Before 39 Completed WeeksReported to the Leapfrog Hospital Survey (Data as of 3/31/2011)

30%

23%

13%10%

4%6%

250

200

150

100

50

0

Num

ber o

f Hos

pita

ls

Elective Delivery Rate Before 39 Completed Weeks0-5% 5-12% 12-20% 20-28% 28-36% 36-44% 44+%

2010 National Average (17.0%)

13%

Esophageal Resection Results: Predicted Mortality for 2009 & 2010 (Leapfrog Hospital Survey Data 3/31/11)

10%12%

10%

3%3%

12%

0%

5%

10%

15%

20%

25%

Average HospitalPerformance

Best PerformingHospital

Worst PerformingHospital

Pred

icte

d M

orta

lity 2009

2010

Pancreatic Resection Results: Predicted Mortality for 2009 & 2010 (Leapfrog Hospital Survey Data 3/31/11)

11%

19%

10%

0%0%

21%

0%

5%

10%

15%

20%

25%

Average HospitalPerformance

Best PerformingHospital

Worst PerformingHospital

Pred

icte

d M

orta

lity 2009

2010

Average Standardized Infection Ratio for CLABSI: State Results (Leapfrog Hospital Survey 3/31/2011)

Aver

age

Stan

dard

ized

Infe

ctio

n Ra

tio

State With More �an 20 Hospitals Reporting Infection Rates to Leapfrog

MI WA TX CO OH MA NJ CA GA IL FL TN VA

1.40

1.20

1.00

0.80

0.60

0.40

0.20

0.00

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tools and technology

liazon was founded in 2007 to tackle the myriad problems inherent in employee benefits for small and mid-sized employers. Liazon’s retail employee benefits solutions give employers a cost-saving defined contribution strategy for all benefits. Liazon’s Benefits Exchange™ is the online store where employees find, learn about and purchase health care and other insurance products.

“liazon’s Bright choices Benefits exchange is the online store where employees shop for their benefits. It brings an exciting new retail model to employee benefits that empowers benefits consumers and saves employers money. think of it as the ‘amazon.com’ for employee benefits.”

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lIazon737 Main Street, Suite 200Buffalo, NY716.803.6190 708 Third AvenueNew York, NY212.209.3836

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WellnessVacations is the leader in partnering with employers to promote the “orIgInal” Wellness Program to target stress and worker burnout to reduce health, disability, and workers comp claims.

It is simply not enough to offer a vacation benefit. Employees are afraid to ask for vacation for fear of being perceived as a “slacker”. As a result employees are burned out and eventually will become unproductive or leave. The WellnessVacations program provides “network” type savings so employees can afford to take a quality vacation. It is the right thing to do.

“employers need to Increase participation in wellness activities to create a culture of wellness with a positive message. our program can be an incentive and reward for participation and continue the health benefits when they actually use the reward—double the return! a “healthy” lifestyle Must include time away from work and our program allows the employer to send that message while promoting a healthy lifestyle”.

— Karen M. Quigley, Chief Vacation Officer, WellnessVacations

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n Is fully integrated with the industry’s leading benefits card that achieves the highest auto-substantiation rates

n Administers complex HRAs with multiple tiered payouts and a variety of deductible arrangements

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Solutions to help your innovative health and benefit programs.

48 May/June 2011 i CDHC Solutions™ i www.cdhcsolutionsmag.com

Benefit software Inc. (BsI) is the leader in client satisfaction when it comes to helping organizations meet important benefits communications challenges for today’s diverse workforce. Offering web-based enrollment solutions, web-based or printed Total Rewards Statements, and PC-based Statement software, BSI helps thousands of organizations achieve complex enrollment and communications goals. With over thirty years of experience supporting mid-size to Fortune 500 businesses, BSI has gained insights into solving the most challenging benefits administration and communications challenges.

“If you can imagine a benefits enrollment or a benefits communication solution that will help your organization motivate and educate employees then Benefit software can build that solution for you. We have 30 years of experience in delivering best-of-breed employee focused communications solutions. We look forward to helping you.”

— William Smith III, Head of Sales, Benefits Software

BenefIt softWare Inc.212 Cottage Grove AvenueSanta Barbara, CA 93101

[email protected]


t o t a l P o P u l a t I o n h e a l t h c a r e M a n a g e M e n t

hsa/hra/fsa technology: adMInIstratIon & ManageMent hsa/hra/fsa technology: adMInIstratIon & ManageMent

tsys healthcare®, provides end-to-end strategic payment solutions for consumer directed healthcare. We partner with benefits administrators, financial institutions and health plans and software providers to navigate all aspects of HSAs, HRAs, FSAs, cash reimbursements and lines of credit. TSYS Healthcare cards offer participants the security they expect along with the ability to conveniently access funds from multiple accounts and manage their benefits payments with simplified single-card access. Clients and partners benefit from simplified processes, reduced paperwork and cost savings that contribute to improved return on investment.

“We built the tsys healthcare platform to meet the market demand for reliable, configurable and intelligent solutions. understanding the dynamic u.s. healthcare market, our customers rely on our option-driven system to prepare them for the future. “

— Trey Jinks, Group Executive, TSYS Healthcare

tsys healthcare612.338.3871www.tsys.com/solutions/[email protected] established in 1998, ameriflex is an independent benefits administrator

providing technology-based, consumer-driven benefits and compliance solutions.

“at ameriflex, we are constantly looking for new ways to bring innovative and cost-effective payment solutions to the market in order to improve efficiency and simplify the delivery of healthcare products and services to all stakeholders.”

— William Short, President & CEO, AmeriFlex

aMerIflex302 Fellowship Road, Suite 100Mount Laurel, NJ 08054Internal sales support:888.868.3539 (FLEX), option 4Proposals and Marketing Inquiries:[email protected]

n ameriflex convenience card® Consolidated FSA/HRA/HSA/CRA Debit Card Platform

n ameriflex convenience sleeve Consolidated FSA/HRA/HSA Healthcare Payment Solution

n ameriflex convenience Portal Web-Based System for Streamlined Administration of CDHC Plans

n Mongoose® Enterprise Class, Web-Based Solution for COBRA Administration

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hsa/hra/fsa technology: adMInIstratIon & ManageMent

no other solution available today has been so deliberately designed to meet the benefit plan design, user experience and unique workflow management needs of administrators, employers, and consumers. As a web-based, real-time platform, Lighthouse1 OnDemand™ saves employers and consumers more than $1.2 billion a year in tax savings and administrative costs. Lighthouse1 OnDemand is the engine that combines technology, healthcare and banking to provide automation in the healthcare industry. Lighthouse1 and its partners serve more than 2.5 million consumers, making Lighthouse1 the nation’s largest web-based healthcare solution that manages HSAs, HRAs, FSAs, and Transit Plans.

“rising healthcare costs, increased employer expectations and a challenging economy create tremendous opportunities in the cdh industry. lighthouse1 is uniquely positioned to combine superior services and innovative technologies to administrators, employers and consumers. With the recent launch of lighthouse1 Mobile, consumers now have even more access to their healthcare benefits and more control over their healthcare spending. together with our strong network of partners, we are poised to keep reducing costs and simplifying the business of healthcare.”

— Jeff Young, Chief Executive Officer for Lighthouse1

lIghthouse 19800 Bren Road East, Suite 250 Minneapolis, MN 55343

www.lighthouse1.com952-908-9056

www.cdhcsolutionsmag.com i CDHC Solutions™ i May/June 2011 49

50 May/June 2011 i CDHC Solutions™ i www.cdhcsolutionsmag.com

www.cdhcsolutionsmag.comWho’s Who Profiles

Solutions to help your innovative health and benefit programs.

If you use the services of our solutions providers, please tell them you saw their ad in CDHC Solutions™ or EmployersWeb.com™ magazine.Requests for Permissions to reuse content contact Copyright Clearance Center at [email protected].

advertising contacts

aetna ............................................................................. 7

aflac..............................................................................22

ahiP .............................................................................50

alliant credit Union ......................................38-39

allstate Benefits .....................................................51

acclaris ........................................................................19

ameriflex ...................................................................49

BeMas software inc. ............................................48

Benefits software...................................................48

Best Buy ...............................................................42-43

cdhc solutions forUM West ..............13-15

cdhc superstars ...................................................24

cigna ............................................ inside Front cover

dataPath ....................................................................20

dss research ...........................................................49

envision Pharmaceutical services .....40-41, 50

fis healthcare solutions ....................................28

health care reform navigator .......................45

intellispend ..............................................................34

liazon ..........................................................................48

lighthouse1 ..............................................................49

My hsa rewards ...................................................47

Payflex ........................................................................... 5

Prime Therapeutics ...............................................26

tsYs healthcare ....................................................49

Unitedhealthcare ................................Back cover

Wellness vacations ...............................................48

advertising index

404.671.9551

C E O / P u b L I S h E rDoug Field [email protected] · ext. 101

Associate PublisherBrent Macy [email protected] · ext. 103

Vice President of business DevelopmentSusan Yakots [email protected], ext. 102

Murray Kasmenn [email protected] 770.356.2342

business Development AssociatesRogers Beasley [email protected], ext. 109

David Cerri [email protected], ext. 106

reprintsRogers Beasley [email protected], ext. 109

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envision Pharmaceutical services, Inc is a full service pharmacy benefits management company that delivers! We deliver because our business model is based on transparency and full disclosure, guaranteeing 100% pass through pricing of all pharmaceutical manufacturer rebates and administrative fees at the point-of-sale. Additionally, our affiliate, Envision Insurance Company, is a national Prescription Drug Plan which enables us to offer a variety of solutions for your retirees. Envision is truly a “different” PBM!

“envision is pleased to be recognized by its clients surveyed by the Pharmacy Benefits Management Institute for three consecutive years as the top performer in virtually every category evaluated. this solidifies our leadership position in providing transparency and full disclosure to the PBM marketplace while continuing to find innovative solutions.”

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