Virginia health system says wellness program saved $3.4M

Sentara Healthcare, a Norfolk, Va.-based health system, reportedly saved $3.4 million in employee healthcare coverage costs by implementing an aggressive three-year wellness program.

Executives at the not-for-profit system with 100 sites of care, including eight hospitals, said they were looking for a way to keep premiums and co-pays down for their employees, so they created a wellness plan with Optima Health, its insurance carrier.

"For every dollar spent to incentivize employees to improve their health, Sentara Healthcare saved $6," said Optima Health President and CEO Michael M. Dudley.

Called "Mission: Health," the program was launched in 2008 for more than 11,200 benefit-eligible Sentara employees in Virginia and North Carolina. Nearly 80 percent of the system's employees participated in the program, which demonstrated significant clinical improvements in risk factors such as cholesterol, blood pressure, body mass index, exercise and tobacco use, according to Dudley.

"The most important outcome of the wellness program for Optima Health is the difference it has made in people's lives," he said.

According to Sentara Healthcare Senior Vice President for Human Resources Michael Taylor, the hospital system realized that 20 percent of its employees were producing 80 percent of healthcare costs. Sentara leaders believed they could significantly cut costs if employees were encouraged to better manage their chronic diseases, he said.

"The biggest challenge is keeping people engaged," says Karen Bray, PhD, RN, Optima Health's vice president of clinical care services, who helped design the program. While Sentara – like an estimated 86 percent of the country's employers – had offered a wellness program in the past, it achieved only modest success through nominal rewards to employees. Much larger incentives were needed to motivate employees.

According to Bray, employees were asked to complete a voluntary personal health profile that measured risk factors. Those with low risk factors were immediately awarded an annual premium reduction of at least $500. Those with two or more risk factors could earn that incentive by working with a health coach. Those who declined to participate were not eligible for discounts.

Employees with targeted chronic diseases such as diabetes, coronary artery disease or congestive heart failure – as well as those who were pregnant – were eligible for additional incentives if they worked with disease managers who monitored their medication, medical check-ups and other crucial health activity. Those employees earned an additional $460 per year in premium discounts, Bray said.

Bray predicted the cost savings are likely to continue for the next three to five years and then reach a plateau. At that point, she said, the program's function will be to keep costs from increasing.