1. Connecting Health to Business
Thomas Parry, Ph.D.
President
Integrated Benefits Institute

2. About IBI
• National, not-for-profit corporation
• 700+ corporate sponsors
• Employers: 90% of IBI’s members
• Liberty Mutual IBI Board member
• IBI’s mission. Demonstrate the business
value of a healthy workforce through:
– Independent HPM research
– Measurement and modeling tools
– Forum for sharing ideas and experience

3. New Employer Realities
• Show the C-suite the value of improved
workforce health
• Healthcare reform: the value of a healthy
workforce or the cost of healthcare?
• Dead end: attempting to control claims
costs in separate program silos
• Looking for best strategies to improve
workforce health, reduce lost time and
enhance productivity
• Limited data, time and dollars

4. What’s at Risk for Employers?

5. The Full Costs of EE Health
-- Auto Manufacturers
• Estimates based on IBI’s new FCE
modeling tool
• 171,250 employees
• Employer-paid claims costs only
• Published as IBI Quick Study in
February 2011

6. Health Costs – The Traditional View
Medical
$500
Total = $509 MM
$400
$300
$200
$100
$0
Medical (EE) Medical (family)

7. Health Costs – Adding Pharmacy
Medical Pharmacy
$500
Total = $623 MM
$400
$300
$200
$100
$0
Medical (EE) Medical (family)

8. Health Costs – Adding Lost-Time Pay
Medical Pharmacy Wage replacements
$500
Total = $824 MM
$400
$300
$200
$100
$0
Medical (EE) Medical (family) Time-loss pay

9. Health Costs – Adding Absence Impact
Medical Pharmacy Wage replacements Absence LP
$500
Total = $923 MM
$400
$300
$200
$100
$0
Medical (EE) Medical (family) Time-loss pay Lost productivity

10. Health Costs – Adding Performance Impact
Medical Pharmacy Wage replacements
Absence LP Performance LP
$500
Total = $1.29 B
$400
$300
$200
$100
$0
Medical (EE) Medical (family) Time-loss pay Lost productivity

11. Full Cost Components
28%
48%
8%
16%
Medical Wage replacements
Absence LP Performance LP

12. Quantifying Financial Lost Productivity*
• Lost productivity – “the financial impact on a
company when employees are not at work and fully
functioning”
• Two components: absence and decrements in job
performance (“presenteeism”)
• The Financial Impact of Absence
– Wage replacement payments
– “Opportunity costs” of ER’s response
• The Financial Impact of Presenteeism
– Wage and benefit “overpayments”
– Opportunity costs of resulting lost time
*Source: Sean Nicholson, Mark Pauly, et al., "Measuring the Effects of Work Loss on Productivity with
Team Production," Health Economics 15: 111-123 (2006).

13. Full Costs –
Medical, Pharmacy, Absence
and Presenteeism
$400,000
$350,000
$300,000
Cost per 1000 EEs
$250,000
$200,000
$150,000
$100,000
$50,000
$0
Medical Pharmacy Absence lost prod Presenteeism lost prod

14. Co-Morbidity and Lost Time
Absence lost time Presenteeism lost time
40
35
30
Lost days
25
20
15
10
5
0
1 2 3 4 5 6 7 8 9 10+
# of chronic conditions

15. The View from the C-Suite

16. Making Health the CFO’s
Business
Thomas Parry, Ph.D.
President
Integrated Benefits Institute

17. Key Research Questions
• How do CFOs view workforce health as a
priority in their business?
• What’s the relationship between health of
EEs and health of the company?
• What types and sources of information
are considered credible?
• How do CFOs see VBBD?
• What kind of information is needed?

18. Health as a corporate priority
8% 8% 6%
19%
24% 24%
49% 56%
48%
69%
68% 75%
20% 20% 19%
Promoting healthy A culture of health is a key Comprehensive health
behaviors is a company company goal coverage is important to
priority company financial strategy
Strongly Agree Agree
Neither Agree Nor Disagree Disagree or strongly disagree

19. Leaders and Non-Leaders
H+P Leaders The uninitiated
29%
53%
18%
The ambivalent

20. Workforce productivity as "one of the
most important factors" for …
62%
45%
8%
Ability to respond to Financial performance Reputation w/
customer/market needs lenders/investors

21. “Very important” to workforce
productivity
Maintaining skilled
75%
workforce
Controlling staff size 61%
Increasing EE satisfaction 51%
Controlling turnover 48%
Providing EE training 42%
Making capital
37%
investments
Health
Improving EE health 30%
Other 22%

22. % CFOs that say EE health is "very
important" to workforce productivity
48%
23%
H+P Leaders Other CFOs

23. The Importance of
Information

24. Improving workforce health:
information credibility
Company's claims costs 70% 28% 2%
EE surveys 31% 62% 8%
Company's information 22% 70% 8%
Outside information 21% 75% 3%
Modeled estimates 15% 74% 12%
Supplier recos 14% 76% 10%
Very Credible Somewhat Credible Not Credible

25. Usefulness of Information
100% 96%
91% 90% 90% 89% 88%
83% 82%
80%
60%
40%
20%
0%
Helpful Not helpful

26. Availability of Helpful Information
100%
80%
60% 79%
75%
40%
54%
51%
20% 37% 36%
24%
15%
0%
Available Unavailable

27. Lessons

28. Lessons for CFOs
• Credible information and methods
for measuring impact are available in
market
• Partner with colleagues in your
organization who measure/manage
lost time
• Make your financial goals well known
within your organization and with
key supplier partners

29. And if you’re working with CFOS...
• Access the solid business case info that
is available
• Advocate a culture of health
• Start with maximizing available internal
information
• Learn CFO’s strategic financial goals and
focus there
• What’s the current culture of health?
• Are you working with an H+P Leader?

30. Employers and
Data

31. Key Dimensions of Population
Health
• Financial • Preventive care
• Program • Chronic
participation conditions
• Biometric • Lost worktime
screening • Lost productivity
• Health risks • Employee
• Utilization engagement

32. The Temporal Dimension
• Leading indicators
– Health risks
– Biometric screening
– Chronic condition prevalence
• Treatment indicators
– Preventive care
– EE engagement
– Health services utilization
– Program participation
• Lagging indicators
– Financial
– Lost worktime
– Lost productivity

33. Dimensions & Dashboard Metrics
Dimension Summary Metric
Financial Program cost/EE
Program participation EEs participating/All EEs
Biometric screening EEs reaching target/All EEs
Health risks # of health risks/EE
Utilization # EEs getting care/All EEs
Preventive care # EEs getting screened/All EEs
Chronic conditions # EEs w/ chronic conditions/All EEs
Lost worktime # of lost workdays/EE
Lost productivity Lost productivity $/EE
Employee engagement Engagement score/EE

34. Thinking about Metrics as
Hierarchies
Dashboard
metrics
Component
metrics
Contributing
metrics

35. Dimension: Lost Work Time
Dimension Dashboard Component Metrics Contributing
Metrics Metrics
Lost worktime

36. Dimension: Lost Work Time
Dimension Dashboard Component Metrics Contributing
Metrics Metrics
Lost worktime
# of lost
days/EE

37. Dimension: Lost Work Time
Dimension Dashboard Component Metrics Contributing
Metrics Metrics
Lost worktime
# of lost
days/EE
Incidental absence
days/EE
LTD lost days/EE
WC lost days/EE
Reduced performance
days/EE
STD lost days/EE

38. Dimension: Lost Work Time
Dimension Dashboard Component Metrics Contributing
Metrics Metrics
Lost worktime
# of lost
days/EE
Incidental absence
days/EE
LTD lost days/EE
WC lost days/EE
Reduced performance
days/EE
STD lost days/EE
Incidence/100 EEs
Ave.
duration/claim
Median
duration/claim

39. Contact IBI
Thomas Parry, Ph.D., President
tparry@ibiweb.org
www.ibiweb.org