An ounce of prevention

Public Employee Advocate
April/May 2012
Feature story

LOST IN THE rancor over the individual mandate and the GOP's belittling references to "Obamacare" are components of the Affordable Care Act that provide real-time health and financial benefits to Americans.

One such component requires health plans to cover recommended preventive services, such as cholesterol, blood pressure and diabetes screenings, for free to participants in "non-grandfathered" plans. (See definition on page 5.)

Experts on best practices in healthcare policy, healthcare financing and organizational productivity say free access to preventive care is a giant step toward holding the line on costs—and keeping people healthy.

It's called "value-based insurance design" (V-BID), a concept introduced by researchers at the University of Michigan more than a decade ago.

"The basic V-BID premise is to align patients' out-of-pocket costs, such as copayments and deductibles, with the value of health services," says Dr. A. Mark Fendrick of the University of Michigan's Center for Value-Based Insurance Design, in a September 2011 article for Kaiser Health News. "By reducing barriers to high-value treatments (through lower costs to patients) and discouraging low-value treatments (through higher costs to patients), these plans can improve health outcomes."

An often-cited example of a high-value treatment is prescription statins for people with high cholesterol. Left untreated, high cholesterol can progress into coronary heart disease. It is much cheaper for health plans to subsidize the cost of the prescription than it is to pay for heart bypass surgery, experts say.

A look at a value-based plan

The public sector is lagging behind the private sector when it comes to incorporating V-BID principles and wellness programs into health plans, says Lynne Mingarelli, deputy director of the AFT's research and information services department and head of the AFT's Center for Collective Bargaining. "There has to be a culture shift," she says.

Connecticut transitioned to a value-based insurance design model last year. In August, state employees represented by more than a dozen unions, including the AFT, ratified contracts setting in motion a voluntary Health Enhancement Program based on V-BID principles.

During negotiations and membership meetings leading up to the contract ratification vote, "one of the loudest arguments was that people didn't want to be told what to do," says Administrative and Residual Employees Union president Laila Mandour. "The general feeling was 'I don't want to be told how to take care of myself.' "

When it came time for state employees to enroll in the program last fall, whatever reservations they had were largely set aside. More than 50,000 employees, 96 percent of those on the state health plan, enrolled in the Health Enhancement Program.

Under the program, which went into effect Oct. 1, employees pay lower monthly premiums and have no deductible for in-network care as long as they follow a schedule of care, including age-appropriate exams and immunizations.

For people 50 and older, that means, for example, an annual checkup and cholesterol screening, while a preventive visit and cholesterol screening is required once every two years for people ages 40 to 49, and once every three years for people ages 30 to 39.

The Health Enhancement Program has a more rigorous regimen for people with certain chronic conditions, including diabetes, Chronic Obstructive Pulmonary Disease, coronary artery disease and hypertension. The prescribed treatment: two doctor visits annually, plus annual screenings related to those conditions and lower copayments on drugs prescribed to treat them.

Workers who did not enroll in the program pay an extra $100 a month toward their premiums as well as an annual $350 deductible per person covered under the plan, up to $1,400 maximum per family.

Mandour notes that "there are some kinks like every plan has in the beginning, but the labor-management Healthcare Cost Containment Committee is doing a good job addressing the problems."

"I think it is a very good way to keep members and their families healthy," says Alfredo Camargo, a special investigator for the Connecticut Office of the Chief Medical Examiner, who represents the Administrative and Residual Employees Union on the committee. "Like anything else, change is seldom welcomed. The most important thing we can do on behalf of members is keep an eye on plan development and how things are handled moving forward, so there is no disruption in the way people are receiving medical care."

Prevention and early intervention

The Affordable Care Act and Connecticut's Health Enhancement Program encourage preventive care and maintenance over acute care. Another trend that is gaining traction is employer-sponsored clinics as supplements to health insurance plans.

In February, Montana Gov. Brian Schweitzer announced that the state had issued a request for proposals to develop a clinic to provide care to state employees and their dependents. It's a move the MEA-MFT welcomes.

"The idea is to have a healthcare system that encourages and promotes wellness, involves employees in their healthcare decisions, and puts the patient at the center of all healthcare decisions—all while saving money," Schweitzer says.

The employee health center, which would be located in Helena, the state capital, with other locations to follow, would offer primary care physician services, health screenings and pharmacy services.

For some public employees, the idea of their own clinic might sound like a lavish perk that's out of reach. But it is very doable, as two AFT leaders who negotiated such clinics with management explained at the AFT's Collective Bargaining Conference last December.

Tom Forkner, president of the Anderson (Ind.) Federation of Teachers, says the Anderson Community Schools health center was the result of the work of the Insurance Committee, a joint labor-management group.

"The clinic was presented to us as a way we could save on our premium costs," says Forkner, "and we think it has done so."

The health center, which opened in October 2009, is strictly for employees and their dependents who are enrolled in a district health plan. About 900 Anderson Community Schools employees are eligible to use the clinic. Clinic services are free, including prescriptions.

"I think the clinic is great," says Carlynn Malone, who teaches second grade at Valley Grove Elementary School. "I have used it when I've been sick, for my annual physical and to get my blood pressure medicine refilled." Malone, who is treasurer of the Anderson Federation of Teachers, says the clinic has helped her save money on prescriptions and doctor visit copays.

In 2010, Charlotte County, Fla., public schools, working in conjunction with the union, also opened a clinic for school district employees and their dependents. As in Anderson, Ind., clinic services and prescriptions are free.

John Klenovic, recent past president of the Charlotte Florida Education Association, says premium increases were trending 11 percent annually. After the clinic opened, "when it came time to renew, it was 0.3 percent."

To encourage clinic participation, the district offers a $50-a-month wellness credit toward employees' major medical plan premiums. To get the credit, people have to undergo a health risk assessment, says Klenovic, noting that about 80 percent of eligible workers participate in the wellness credit program.

Small steps can lead to big savings

"Wellness costs money initially, and a lot of times employers don't want to put out the money," says the AFT's Mingarelli.

There are smaller scale, less costly programs, she says, that can encourage healthy behaviors and can help hold the line on costs.

One such example is North Dakota. From 2006-2008, the state conducted a pilot work-site health promotion program, offering health risk assessments, lifestyle coaches and work-site health screenings.

A report on the pilot program found, "The greatest improvements occurred in physical activity and nutrition—the areas of health behavior that were the [program's] greatest focus."

The pilot program has segued into a statewide program; agencies must offer a wellness program in order to get a discount on their health insurance package.

Laura Anhalt, a receptionist at the North Dakota Office of State Tax Commissioner, has served as wellness coordinator in her office since the pilot program began. The North Dakota Public Employees Association member says it's her job "to drum up business" for the health challenges, exercise contests and other activities, such as the annual blood pressure check conducted by a county nurse.

"I think people were a little apprehensive at the very beginning," says Anhalt. "But then they rolled out the fruit and vegetable program. People like to have food at work."

The fruit and vegetable program is a weekly ritual at the tax department. Every Tuesday the produce is delivered. Employees pay 25 cents per serving. (The cost of the produce is supplemented by Wellness Denim Days, where employees pay $1 if they wear jeans to work.)

Carrots, not sticks

Whether it's a voluntary wellness program or a substantial change like Connecticut's Health Enhancement Program, the AFT's Mingarelli says the best programs are jointly developed by labor and management, and respond to how people are using their health insurance.

"It's a fact that certain health conditions are the major drivers behind insurance premium increases," says Mingarelli. "Preventive care and adhering to treatment regimens for chronic conditions are two steps in the right direction.

"The sooner health conditions are addressed, the greater the likelihood people will not need expensive treatments and, in the end, not only are healthcare costs reduced but individuals have a better chance at living long, healthy and productive lives."

—KATHY NICHOLSON