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What Employers Should Know About Population Health Management

A modernized approach to employee health can pay dividends in the form of reduced healthcare costs, greater productivity, and improved morale.

Population Health Management (PHM) refers to the process of improving clinical health outcomes for a group of people through proactive care coordination and patient engagement programs. These programs focus on policies and resources that help to keep members healthy by addressing emerging health risks and proactively managing the care of patients with comorbidities.

Traditionally, PHM programs aim to reduce health risks and cost drivers; in other words, employers who take a strategic interest in the health of their workforce are rewarded with reduced plan costs.

Effective PHM programs help employers contain healthcare costs in the following ways:

  1. Reduced costs from avoidable complications
  2. Improved health literacy
  3. Prevention, early detection, and intervention

PHM programs make good business sense because poor employee wellbeing not only costs employers in the form of their health plans, but employers who do not invest in their people also experience absenteeism, turnover, and low productivity. In fact, research from Gallup estimates that employees missing work due to poor mental wellbeing alone costs the US economy $47.6 billion per year.

The roundup below gives an overview of how PHM has evolved to address the complexity of individual lifestyle choices, behavior change, and health outcomes.

Pursuing A Modern Approach to Population Health Management

Historically, PHM programs have gauged the health of group members solely from clinical diagnoses, lab results, and prescription utilization. However, this narrow focus on physical health risks ignores other major variables that impact human health, including social determinants, mental health, and financial wellbeing.

Modern PHM programs should place a greater emphasis on the whole person, including these previously-neglected indicators in order to develop more effective policies for improving a cohort’s health and total wellbeing.

Employees with physical or mental health problems are more likely to get injured at work, less likely to care if they perform poorly, and more susceptible to getting sick. They also might lack the motivation to change lifestyle habits or practice self-care, which can cause exacerbated health conditions requiring more expensive interventions down the road.

By taking a more holistic look at health and treating a greater variety of interrelated risk factors, program managers construct more effective PHM intervention policies. Employers who take this modernized approach realize maximum savings potential and optimized employee performance.

Assess the Status Quo and Consider Policy Interventions

Modern PHM programs should gather a wide variety of data points to measure the current state of workforce health. This process should go beyond the obvious and include non-physical indicators of health. For example:

Is 401k usage low? Employees who are struggling with financial stress could also be experiencing mental health challenges, delaying care, unable to focus at work, or need help with financial wellbeing.

Are workplace injuries increasing? Burnout or other mental issues lead to a greater risk for workplace injury, along with lack of sleep and substance abuse issues. A full assessment of wellbeing programs, including mental health benefits, should be considered.

Has there been an increase in the number of employees taking short-term leave? Employees could be suffering from burnout or stress brought on by a multitude of factors. HR policies can be put in place to create a more supportive environment.

Once areas for wellbeing improvement have been identified and policy interventions have been created, monitor your strategy over time and survey employees for their perspectives. The impact of PHM programs should be measured by whether members are making use of your solutions, whether employees perceive them to be beneficial, and whether outcomes and behaviors are changing for the better.

Provide Health Guidance and Encourage Proactive Care

The impact of a healthy lifestyle and proactive health interventions cannot be overstated. Rather than waiting until employees are visibly struggling and suffering, management can work to create a culture that encourages self-care, provides resources and encouragement for employees to make positive lifestyle decisions, and educates plan members on the best way to use existing health benefits to seek preventative care.

One of the most effective ways to kickstart this process is by assessing employee needs, interests, and demographics:

  • Does a majority of your workforce live in a food desert or low-income areas with little access to healthy food? Provide healthy eating options in the workplace or offer a healthy food delivery service as a voluntary benefit.
  • Are employees struggling to fill prescriptions? Consider waiving co-pays as a short-term investment that can prevent higher future costs.
  • Are employees having trouble accessing and using their health benefits? A Healthcare Navigation Service can assist them in seeking out lower-cost providers and using their benefits efficiently.

Ultimately, PHM is not something that is done to a population, but rather the summation of individual behaviors driven by thoughts, feelings, and overall mental health. The key to truly minimizing health risks (and costs) associated with your workforce is to drive proactive communications and employee education to improve utilization and eliminate wasteful healthcare spending.

Whether employees are with you for six months or sixteen years, you can partner with your team to implement any of the above tactics to improve the health of your employee population and yield hard-dollar savings.

For more information on Population Health Management and other strategies to improve the health of your people and business, read the Cost Containment Playbook: 25 Strategies for Healthcare, Pharmacy, & Workforce Optimization.