Mar 3, 2016, 9:31 AM ETConference Presentation, Panel

Toward a Healthier Workplace: The Business Case for Public Health

Public Health Crisis: One in three U.S. children are overweight or obese; the adult obesity rate is projected to reach 50% by 2030.
Economic Impact: Unaddressed chronic diseases cost the U.S. economy more than $1 trillion annually.
Cost Drivers: Approximately 70% of healthcare costs are driven by human behaviors, while 74% of expenses are confined to four chronic conditions: cardiovascular disease, cancer, obesity, and diabetes.
Strategic Shift: The panel identifies a transition from "style" (participation-based wellness) to "substance" (outcome-based, ecosystem-wide interventions).

Financial Turnaround: Safeway's per capita healthcare costs dropped 9% in both 2014 and 2015 due to a healthier workforce.
Program Structure: The initiative was 100% voluntary, yet 85% of the workforce enrolled because participation reduced health premiums.
Financial Rewards: Premium incentives grew from $500 to $2,000 per year for meeting health outcomes.
Health Outcomes (2005–2013):
- Obesity: Corporate obesity rate decreased from 28% to 21%; 70% of employees who lost weight maintained the loss.
- Blood Pressure: The percentage of employees meeting national standards rose from 58% to 89%.
- Diabetes Control: Meeting HbA1c standards improved from 75% to 86%.
Differentiation: Steve Bird noted only two U.S. companies currently utilize a genuine, absolute outcome-based system, both of which he implemented.
Competitive Benchmarking: A comparison with a large employer running a participation-based program showed minimal movement (47% blood pressure standards met vs. Safeway's 89%).

Heritage Medical Systems Model: Treats health and wellness not as an add-on but as the core business model, managing 1 million patients across CA, NY, and AZ.
Payment Reform: Heritage utilizes population-based payment (capitation) rather than fee-for-service to fund proactive interventions like home visits for 5,000 seniors with congestive heart failure.
Targeting High Utilizers: Approximately 10% of plan members represent 75% of costs; focused interventions on this group significantly reduce long-term expenses.
De-Siloing Care: The panel argues for merging behavioral health and medical care, noting that depression, obesity, and chronic illness are interlocking drivers of health outcomes.
Prevention Timing: Early intervention (e.g., at age 4 or 15) is critical to prevent mid-life onset of type 2 diabetes and reduce future Medicaid/Medicare costs.
Financial Barriers: Current systems lack upfront funding for non-billable preventive actions (e.g., home safety checks for seniors), requiring a shift to value-based purchasing.

Herbalife's Dual Model:
- Employees: A wellness program for 6,000 direct employees models Safeway's outcome-based approach.
- Independent Contractors: 4 million contractors receive nutrition/fitness training to act as public health advocates in their local communities.
Workplace as a Vector: The workplace serves as the primary source of health messaging for low-wage workers (e.g., cashiers), making it a critical leverage point for community-wide behavior change.
Viral Culture: Healthy workplace cultures are expected to "go viral," influencing smaller employers and community standards when employees transition between jobs.
Small Business Scalability: Current robust programs are inaccessible to small employers; new initiatives (e.g., Bird Health) aim to create turnkey products for businesses with fewer than 15 employees.
Community Coalition: The U.S. Chamber of Commerce is convening multi-sector coalitions in 10–12 communities to address environmental barriers (food access, air quality) that undermine workplace wellness.

Leadership Gap: Execution failures are attributed to a lack of leadership willing to stake their careers on long-term health innovation.
Data Deficit: There is a critical need for academic and scientific collaboration to codify best practices and validate the efficacy of current wellness models.
Incentive Misalignment: Financial reward systems often prioritize short-term (1-year) returns over the 5–10-year horizons required for chronic disease prevention.
Employer Loyalty: Effective wellness programs function as "loyalty builders," reducing turnover and increasing employee retention.
Medicare Reform: If healthcare does not pivot to prevention within the next 10 years, the federal government may be forced to implement blunt, cost-cutting interventions that pay for mediocrity rather than innovation.
Future of Care: The panel anticipates a future where health delivery systems function as free markets, mimicking the efficiency of self-insured employers like Safeway.
Mass Personalization: Future wellness programs must deliver actionable, personalized health data to employees in simple formats to drive family-wide behavioral change.

Voluntary vs. Coercive: While financial penalties for non-participation are legal under the ACA, the panel views them as philosophically coercive and potentially counterproductive to reform.
Ecosystem Requirement: Successful programs require a comprehensive ecosystem (fitness centers, nutrition, cancer concierge services, social networking) rather than isolated interventions.
Community Engagement: Businesses must engage in broader community health to ensure healthy employees do not return to unhealthy environments, undermining their investment.
Research Funding: The panel calls for dedicated investment in research to generate the evidence base required to scale these interventions nationally.