union coalition delegates conference zero trends: health as a serious economic strategy
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Union Coalition Delegates Conference Zero Trends: Health as a Serious Economic Strategy. Leadership: A Transformational Approach to Health UNIVERSITY OF MICHIGAN HEALTH MANAGEMENT RESEARCH CENTER Dee W. Edington. - PowerPoint PPT PresentationTRANSCRIPT
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Union Coalition Delegates Conference Zero Trends: Health as a Serious
Economic Strategy
Leadership: A
Transformational Approach to
Health
UNIVERSITY OF MICHIGAN
HEALTH MANAGEMENT RESEARCH CENTER
Dee W. Edington
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Think about what it would be like if you worked in the best performing organization you could imagine and the best place to work.
What words would you use to describe the workplace and how would you describe the workforce?
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Business Problem
Currently, most costs associated with workplace and workforce performance are growing at an
unsustainable rate
How are we going to be successful in this increasingly competitive
world without a healthy and high performing workplace and
workforce?
How can we turn costs into an investment?
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UM-HMRC Corporate ConsortiumConsortiumFordDelphiKelloggWe EnergiesGeneral Motors Crown EquipmentDelphi Automotive Southern CompanyUniversity of MissouriMedical Mutual of OhioFlorida Power and LightSt Luke’s Health SystemSt Joseph Health System Allegiance Health SystemCuyahoga Community College United Auto Workers-General Motors
American Construction Benefits GroupAustralian Health Management
Corporation
Steelcase (H) Progressive (H)
JPMorgan Chase (H) Affinity Health System (H)
SW MI Healthcare Coalition (H)Wisconsin Education Association Trust
(H)
*The consortium members provide health care insurance for over two million individuals. Data are available from three to 20 years.
Meets on First Wednesday of each December in Ann Arbor.
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Union Coalition Delegates Conference Zero Trends: Health as a Serious Business and Economic
StrategyMarch 25, 2011
MissionChange the Economic Assumptions from Treating Disease to the 21st Century Assumptions about Creating and Maintaining Healthy Populations
Natural Flow of a Population High Risks and High Costs
Business Case Health as a Serious Business and Economic Strategy
SolutionEngage Champion Companies in Systematic, Systemic and Sustainable Five Pillars which Promote a Healthy and High Performing Workplace and Workforce
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Section I
The Current Healthcare Strategy
Natural Flow
Wait for Disease and then Treat
(…in Quality terms this strategy translates into
“wait for defects and then fix the defects” …)
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Estimated Health Risks
Health Risk Measure
Body WeightStress Safety Belt UsagePhysical ActivityBlood PressureLife SatisfactionSmoking Perception of Health Illness DaysExisting Medical ProblemCholesterolAlcoholZero Risk
High Risk
41.8%31.8% 28.6% 23.3% 22.8%22.4% 14.4% 13.7%10.9% 9.2% 8.3% 2.9%14.0%
OVERALL RISK LEVELS Low Risk 0-2 risks Medium Risk 3-4 risks High Risk 5 or more
From the UM-HMRC Medical Economics Report
Estimates based on the age-gender distribution of a specific corporate employee population
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1640 (35.0%)
4,163 (39.0%)
678(14.4%)
Risk Transitions (Natural Flow)Time 1 – Time 2
High Risk(>4 risks)
Low RiskLow Risk(0 - 2 risks)(0 - 2 risks)
Medium RiskMedium Risk(3 - 4 risks)(3 - 4 risks)
2,373 (50.6%)
21,750 (77.8%)
4,546(42.6%)
10,670 (24.6%)
4,691 (10.8%)
27,951 (64.5%)
11,495 (26.5%)
5,226 (12.1%)
26,591 (61.4%)
892(3.2%)
1,961 (18.4%)
5,309 (19.0%)
Modified from Edington, AJHP. 15(5):341-349, 2001
Average of three years between measures
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Total Medical and Pharmacy Costs Total Medical and Pharmacy Costs Paid by Quarter for Three GroupsPaid by Quarter for Three Groups
Musich,Schultz, Burton, Edington. DM&HO. 12(5):299-326,2004
The 20-80 rule is always true but
terrifically flawed as a
strategy
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LowLow
Costs Associated with RisksMedical Paid Amount x Age x Risk
Annual Medical Costs
Med RiskMed Risk
Age Range
HighHigh
Non-ParticipantNon-Participant
Edington. AJHP. 15(5):341-349, 2001
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Section I: Four Learning Concepts
1. The flow of Risks is to High-Risks
2. The flow of Costs it to High-Costs
3. Without early identification, the High Cost Spike is not Modifiable
4. Costs follow Risks and Age
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Section II
Build the Business Case for the Health as a Serious Economic Strategy (200+ Publications)
Engage the Total Population to get to the Total Value of
HealthComplex Systems (Synergy & Emergence)
versus Reductionism (Etiology)
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Low RiskLow Risk
Excess Diseases Associated with Excess Diseases Associated with Excess Risks (Heart, Diabetes, Excess Risks (Heart, Diabetes, Cancer, Bronchitis, EmphysemaCancer, Bronchitis, Emphysema
Percent with Percent with DiseaseDisease
Med RiskMed Risk
Age RangeAge Range
HighHigh
Musich, McDonald, Hirschland, Edington. Disease Management & Health Outcomes 10(4):251-258, 2002.
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Percentage of Employees with a Disability Claim by Risk Status*
HRA Participants1998-2000 HRA
WC Claims
STD Claims
Absence Record
Disability Claim
Low Risk0-2 Risks(N=685)
25.4%
23.4%
49.9%
61.3%
Medium Risk3-4 Risks(N=520)
30.2%
30.8%
63.1%
72.5%
High Risk5+ Risks(N=366)
38.0%
46.7%
69.7%
81.7%
Non-Participants
(N=4,649)
30.2%
29.6%
41.0%
64.4%
Wright, Beard, Edington. JOEM. 44(12):1126-1134, 2002
*Over three years 1998-2000
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Excess Disability Costs due to Excess Disability Costs due to Excess RisksExcess Risks
$491$666
$783
$1,248
Wright, Beard, Edington. JOEM. 44(12):1126-1134, 2002
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Excess Medical Costs due Excess Medical Costs due to Excess Risksto Excess Risks
$2,199
$3,039$3,460
$5,520
Edington, AJHP. 15(5):341-349, 2001
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Excess Pharmaceutical Costs Excess Pharmaceutical Costs due to Excess Risksdue to Excess Risks
$345$443
$526 $567
$750 $754
$1,121
Burton, Chen, Conti, Schultz, Edington. JOEM. 45(8): 793-802. 2003
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Excess On-The-Job Loss due to Excess On-The-Job Loss due to Excess RisksExcess Risks
Burton, Chen, Conti, Schultz, Pransky, Edington. JOEM. 47(8):769-777. 2005
14.7%
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Outcome Measures
Low-Risk
Medium-Risk
High-Risk
Excess Cost Percentage
Short-term Disability $ 120 $ 216 $ 333 41%
Worker’s Compensation
$ 228 $ 244 $ 496 24%
Absence $ 245 $ 341 $ 527 29%
Medical & Pharmacy
$1,158 $1,487 $3,696 38%
Total $1,751 $2,288 $5,052 36%
Association of Risk Levels with Association of Risk Levels with Cost MeasuresCost Measures
Wright, Beard, Edington. JOEM. 44(12):1126-1134, 2002
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Change in Costs follow Change in Risks
-$600
-$400
-$200
$0
$200
$400
$600
3 2 1 0 1 2 3Co
st
red
uc
edC
os
t in
cre
ase
d
Risks Reduced Risks Increased
Updated from Edington, AJHP. 15(5):341-349, 2001.
Overall: Cost per risk reduced: $215; Cost per risk avoided: $304 Actives: Cost per risk reduced: $231; Cost per risk avoided: $320 Retirees<65: Cost per risk reduced: $192; Cost per risk avoided: $621 Retirees>65: Cost per risk reduced: $214; Cost per risk avoided: $264
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Medical and Drug Cost (Paid)*
Improved=Same or lowered risks
Slopes differ
P=0.0132
Impr slope=$117/yr
Nimpr slope=$614/yr
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Business Case
Zero Trends follow
“Don’t Get Worse” and
“Help the Healthy People Stay Healthy”
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Total Value of Health Medical/Hospital Drug Absence Disability Worker’s Comp Effective on Job Recruitment Retention Morale
Disease
HealthRisks
The Economics of Total Population Engagement and Total Value of
Health
Low orNo Risks
Where does cost turn into an investment?
increase
increase
decrease
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Section II: Four Learning Concepts
1. Excess Risks lead to Excess Costs
2. Risks Travel in Clusters
3. Change in Risks lead to Change in Costs
4. Controlling Risks leads to Zero Trends
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Health and Wellness ProgramsHealthierHealthier
PersonPersonBetter
EmployeeGains for TheOrganization
1. Health Status
2.Life Expectancy
3.Disease Care Costs
4. Health Care Costs
5. Productivity
a. Absence
b. Disability
c. Worker’s Compensation
d. Presenteeism
e. Quality Multiplier
6. Recruitment/Retention
7.Company Visibility
8. Social Responsibility1981, 1995, 2000, 2006, 2008 D.W. Edington
Lifestyle Change
Health Management Programs
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In December of 2006 we celebrated the first 30 years of our work: the
Business Case was solid, although not yet perfect.
Congratulations!
However, nothing has changed in the population
No more people doing physical activityNo fewer people weighing lessNo fewer people with diabetes
Why the disconnect between the business case and the intervention
outcomes?
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A short Health & Performance Quiz
If you continue to wait for defects and then try to fix the defects: Will you ever solve
the fundamental problems?
If you put a changed person back into the same environment: Will the change be
sustainable?
Is it better to keep a good customer or find a new one?
Is the action you reward, the action that is sustained?
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The world we have made as a result of the
level of thinking we have done thus far
creates problems we cannot solve
at the same level of thinking
at which we created them.
- Albert Einstein
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Where do we go next?
TO A NEW LEVEL OF THINKING
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… to a Transformation from the Tired Old 20th Century Assumptions About Disease to the New 21st Century Assumptions About Healthy and High Performing Populations
1. From health as the absence of disease to health as vitality and energy
2. From only caring for the sick to enabling healthy people to stay healthy
3. From the cost of healthcare to the total value of health
4. From individual participation to population engagement
5. From behavior change to a Culture of Health
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Section III
The Evidence-Based Solution: Zero Trends
Integrate Health into the Environment and the Culture
(…in Quality terms this strategy translates into “…fix the systems
that lead to the defects” …)
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Vision for Zero Trends
Zero Trends was written to be a
transformational approach to the way
organizations ensure a continuous healthy
and high performing workplace and
workforce
Based upon 175 Research Publications
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Integrate Health into Core BusinessHealthierHealthier
PersonPersonBetter
EmployeeGains for TheOrganization
1. Health Status
2.Life Expectancy
3.Disease Care Costs
4. Health Care Costs
5. Productivity
a. Absence
b. Disability
c. Worker’s Compensation
d. Presenteeism
e. Quality Multiplier
6. Recruitment/Retention
7.Company Visibility
8. Social Responsibility1981, 1995, 2000, 2006, 2008 D.W. Edington
Lifestyle Change
Health Management Programs
Company Culture and Environment Senior Leadership Operations Leadership Self-Leadership Reward Positive Actions Quality Assurance
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LAYING THE GROUNDWORK FOR TRANSFORMATIONAL CHANGE
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What is the value to you of a healthy and high performing
champion workplace and workforce?
To your organization?
To your community?
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Characteristic of a Transformational Champion
Organization
Systematic Strategies
Make the Solutions Systemic
Make it Sustainable
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TransformationWhere are you?
Pillar 5 Quality Assurance
Champion
Comprehensive
Traditional
Do Nothing
Senior Leadership
Operational Leadership
Self-Leadership
Recognize Positive Actions
Quality Assurance
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Senior Leadership
Create the Vision
•Commitment to healthy culture
•Connect vision to business strategy
•Engage all leadership in vision
“Establish the value of a healthy and high performing organization and workplace as a world-wide competitive advantage”
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People are inspired by the purpose of the effort
People feel that their values and ideas are incorporated into
what the organization is trying to achieve
People can easily communicate the direction of the effort
People recognize that both individual and organizational needs
are being addressed
People see how their day-to-day activities can support the
overall goals of the effort
Create the Vision
A Vision Must be Woven into Everything & Repeatedly Promoted!
Pillar 1: Senior Leadership
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Example Vision - Intel
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Operations Leadership
Align Workplace with the Vision
•Brand health management strategies
•Integrate policies into health culture
•Engage everyone “You can’t put a changed person back into the same environment and expect the change to hold”
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The Transformation needs New Tools
Next Generation Health Risk Assessments
Corporate Culture and EnvironmentalAudit and Gap Analyses
Where do Employees go after Work?Community and Home
From Best Practices to Next Practices
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A socially and structurally-constructed set of core attributes reflecting the prevailing values, underlying assumptions, expectations and definitions that members of a work organization collectively maintain.
The sum of these characteristics effect the way members think, feel, and behave related to matters of personal and group health.
What is a Culture of Health
Pillar 2: Operations Leadership
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Promote Self Leadership
Create Winners “Champions”
•Help employees not get worse
•Help healthy people stay healthy
•Provide improvement and maintenance strategies “Create winners, one step at a time and the first step
is don’t get worse’
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Self-Leadership and High Performance
•Personal Personal ControlControl
•OptimismOptimism
Self-Self-leadershipleadership
•ResilienceResilience
•ConfidenceConfidence/ Self-/ Self-efficacyefficacy
•Self-Self-esteemesteem
•Knowledge Knowledge •Health LiteracyHealth Literacy•Negotiation SkillsNegotiation Skills
•Vitality/Vitality/VigorVigor
• ConsumerismConsumerism• EngagementEngagement
•Social Social SupportSupport–ColleaguesColleagues–Community Community –FamilyFamily
• Environment Environment and culture and culture
Other possible *constructs: Change, Vision, Trust, Thrive, Enthusiasm, Ethics, Energy, Spirituality, Creativity, …
•Low-Risk Health Status
•Purpose-Values-Mission-Vision
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Strategies Focused on Individuals
Lifestyle/behavior change programs (e.g., programs to help employees stop smoking or abusing drugs, lose weight, or better manage stress)
Health and safety training (e.g., training employees on general workplace safety practices and those that apply to their specific jobs)
Clinical and preventive services (e.g., screenings and immunizations for employees and their families)
Source: UCI Health Promotion Center, Workplace Health Promotion, Information and Resource Kit. http://www.seweb.uci.edu/users/dstokols/hpc.html
Pillar 3: Self-leadership
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Weight ManagementPhysical Activity Stress Management CommunicationsSafety Belt UseSmoking CessationNutrition Education On-Line InformationNurse LineNewslettersBehavioral Health & EAPPharmacy ManagementCase ManagementAbsence ManagementDisability Management
• Business Specific Modules• Career Development• Communications• Financial Management• Social/Information Networks• Clinic or Medical Center• On-Line Information• Ergonomics• Vision • Dental• Hearing• Chiropractic• Complementary Care• Integrative Medicine• Physical Therapy
Population Based ResourcesPillar 3: Self-leadership
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Recognize Positive Actions
Reinforce the Culture of Health
•Recognize champions
•Set recognition for healthy choices
•Reinforce at every touch point“What is rewarded is what is sustained”
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Incentives Tied to Medical Plan Design:
•Premium reduction
•HRA completion
•HRA credits to offset deductibles
•Reduced co pays for preventative services
•Reduced co pays for Rx adherence of certain drug classes
•Non tobacco user incentive
Incentives Tied to Behaviors and Results:
•Wellness rebates for participation in physical activity; weight management; tobacco cessation programs
•Greater subsidy of healthy foods in cafes, lower costs to employees
•Recognition of employees that improve their health through positive lifestyle changes
Encourage Desired BehaviorsPillar 4: Recognize Action
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Tangible IncentivesCash
Merchandise
Vacation days
Avoidance of costs (such as health care premiums or deductibles)
Intangible IncentivesExtrinsic:
Recognition Group competition Acceptance and approval of
peers
Intrinsic: Personal challenges A sense of accomplishment A sense of belonging
Incentives can be tangible or intangible
The Science and Art of Motivating Healthy Behaviors, by Barry Hall, BENEFITS QUARTERLY, Second Quarter 2008. http://www.buckconsultants.com/buckconsultants/portals/0/documents/publications/published_articles/2008/Articles_Hall_Benefits_Quarterly_Q2_08.pdf
Recognize Positive ActionPillar 4: Recognize Action
Can be the tipping point that moves someone from inaction to action
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Quality Assurance
Outcomes Drive the Strategies
•Integrate all resources
•Measure outcomes
•Make it sustainable“Metrics to measure progress towards the vision, culture, self-leaders, actions, economic outcomes”
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Onsite / Onsite / Near-site Near-site MedicalMedical
Fitness Fitness CenterCenter
Behavioral Behavioral Health Health
Case Case ManagementManagement
Absence Absence ManagementManagement
Employer DataEmployer DataHealth Plan Health Plan
DesignDesign
Disease Disease ManagementManagement
Health Health AssessmentAssessment
Health Health PortalPortal
Data Integration: Core of Quality Management
Consolidated Data andConsolidated Data and and Relational Outcomes and Relational Outcomes
ReportingReporting
Data Warehouse
Health Health AdvocacyAdvocacy
Wellness/ Risk Wellness/ Risk Reduction ProgramReduction Program
• CompensationCompensation• Employer/ Job Employer/ Job
typetype
• Performance Performance • Safety/Risk Safety/Risk
ManagementManagement
• Risk informationRisk information• Health OutcomesHealth Outcomes
• Web MetricsWeb Metrics• Program ParticipationProgram Participation
• Risk informationRisk information• Behavior ChangeBehavior Change• Health OutcomesHealth Outcomes
• Medical Medical Service Service utilization datautilization data
• Performance Performance • Safety/Risk ManagementSafety/Risk Management
•Program Program engagement engagement datadata
• Data on use of Data on use of CenterCenter
• Exercise freq./ Exercise freq./ durationduration
• Data on plan Data on plan coverage, copay coverage, copay levels, etc.levels, etc.
• Absenteeism Absenteeism informationinformation
• Mental health service Mental health service utilization datautilization data
•Program Engagement dataProgram Engagement data•Adjunct risk and health Adjunct risk and health behavior databehavior data
Pillar 5: Quality Assurance
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Evaluate Outcomes
Were there changes in Psychosocial
Outcomes?
Did health behaviors improve?
Did health and clinical outcomes
improve?
Were there changes in worker
productivity ?
What types of organizational
outcomes were seen?
Was there a positive return on
investment?
53
Program Outcomes Program Outcomes
Psychosocial (Examples)•Self-efficacy•Resilience•Quality of Life
Behavior Change (Examples) •Healthy Diet•Regular Exercise•Smoking Cessation•Stress Reduction
Health Indicators (Examples) •Health Status•Clinical Indicators
Performance•Absence•Disability•Worker’s Comp•Presenteeism
Organization Level Impact•Recruitment/ Retention•Company Visibility•Social Responsibility
Financial•Service Utilization•Expected Cost Trend •Demonstrated Cost Trend
Measure and understand change in outcomes that drive health and cost trends…
Outline an outcomes framework and system of measurement to determine the ongoing effectiveness of the program and the organization’s financial gains
Quality Assurance
Evaluate Outcomes
Pillar 5: Quality Assurance
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Summary
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Characteristic of a Transformational Champion
Organization
Systematic Strategies
Make the Solutions Systemic
Make it Sustainable
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Overall Business StrategyWhat is your vision?
Pillar 2: Operations Leadership
Vision from
Leaders
Healthy System & Culture
Champion
Everyone a Self-Leader
Recognize Positive Actions
Progress in All Areas
Comprehensive
Traditional
Do Nothing
Speech from
Leader
Reduction in Risks
Reduce Health Risks
Reward Achievement
Change in Risk &
Sick Costs
Inform Leader
Programs Targeting
Risks
Health Risk
Awareness
Change in Risks
Status Quo
Senior Leadership
Operational Leadership
Self-Leadership
Recognize Positive Actions
Quality Assurance
Status Quo Status Quo Status Quo Status Quo
Reward Enrollment
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What’s the Point
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Thank you for your attention.Please contact us if you have any questions.
Phone: (734) 763 – 2462Fax: (734) 763 – 2206
Email: [email protected]
Website: www.hmrc.umich.edu
Dee W. Edington, Ph.D. , Director Health Management Research Center School of Kinesiology University of Michigan 1015 E. Huron Street Ann Arbor MI 48104-1689