Health & Productivity: A Research Agenda from the Private Employer Sector: What Works.. What Doesn’t Kenneth Mitchell, Ph.D.. Chattanooga, TN Nuts and Bolts Research Methods Symposium UT College of Medicine Chattanooga September 29, 2006

2 Health & Productivity Management: Connections All lost time is connected Lost time and healthcare costs are connected Impairment is objective… Disability is subjective …. …and depends on……. Understand that corporate policies and practices “disable” more individuals than any injury or illness.

3 The Health & Productivity Realities The following health and productivity issues are common issues for all employers in the public and private sector. 1.Create affordable and accessible health care 2.Reduce the cost of lost productivity 3.Understand workforce health trends – Increased chronic disease & ambiguous impairments 4.Prepare for aging workforce – Increased longevity & productive aging 5.Create solutions for ambiguous impairments (e.g. Depression, chronic pain) & performance management 6.Recognize work/life predicaments that turn into “Disabilities” or Who will be the last well person? The H&P Points of Contact that can be enhanced though research & education

4 The Real Problem: The Full Cost of Employee Illness Medical & Pharmacy Costs *$6,020 PEPY Health-related Productivity Costs $12,000 PEPY 33% 66% Workers’ Comp Medical Costs Salary Continuation Personal Health Costs Medical Care Pharmacy Hospitalization Behavioral Health Productivity Costs Presenteeism Turnover Replacement Training Temporary Staffing Administrative Costs Variable Product Quality Employee Dissatisfaction Customer Dissatisfaction Overtime Off-Site Travel for Care STD LTD S ources: Loeppke, et.al., JOEM, 2003; 45: and Brady, et.al., JOEM, 1997; 39: Total PEPY = $18,020 *2003 PEPY Avg. Absenteeism

5 The Context Percent of GDP - Social Security, Medicare, and Medicaid Spending: Social Security Medicaid Medicare Note: Social Security and Medicare projections based on the intermediate assumptions of the 2005 Trustees’ Reports. Medicaid projections based on CBO’s January 2005 short-term Medicaid estimates and CBO’s December 2003 long- term Medicaid projections under mid-range assumptions. Source: GAO analysis based on data from the Office of the Chief Actuary, Social Security Administration, Office of the Actuary, Centers for Medicare and Medicaid Services, and the Congressional Budget Office.

6 Healthcare Costs by Age x Risk Source: Musich, McDonald, Hirschland, Edington, Disease Managements & Health Outcomes 2002; 10(4): ; University of Michigan Health Management Research Center. Used with permission. Dee Edington, Ph.D. University of Michigan, Ann Arbor, Michigan

7 Pain Costs Compared to Other Conditions: A Case Study Disease Prevalence RateCost % of Grand Total Cost Coronary Artery1.18$5,329, Heart Failure0.21$18,487, Diabetes3.19$59,279, Asthma2.68$36,432, Depression2.12$44,181, Pain8.36$154,130, Subtotal-----$317,840, Grand Total-----$458,433,

8 Pain and Co-morbid Conditions Condition% Pain Patients w/ Condition % Total Population with Condition Diabetes8.34%3.19% Depression7.91%2.37% Arthritis9.14%1.30% Hypertension18.06%6.07% Injuries24.24%7.19% Anxiety4.20%1.27%

9 Source-of-Pain Categories Source of Pain # of Patients% of MSCP patients Nerve compression 2, % Carpal tunnel syndrome (cts) 1, % Myalgia 12, % Nerve damage 3, % Migraine 2, % Joint 2, % Other drug dependency 2, %

10 Pain Related Events

11 Pain Related Events

12 Medical & Disability Costs* Related to Medical Conditions Dollars PEPY (per employee per year) Medical *Disability ٭ Includes direct disability costs, but does not include related absenteeism, presenteeism and productivity costs/losses

13 Medical vs. Productivity Costs of Pain Costs of Selected Pain Related Conditions ConditionAnnual Direct Medical Costs Annual Productivity Costs Repetitive Strain Injuries, including Carpal tunnel syndrome $1 billion$26 billion Lower back pain$25 billion$28 - $56 billion Migraine$1 billion$13 - $17 billion American Academy of Orthopedic Surgeons. X.H., Markson, L.E., Lipton, R.B., Stewart, W.F., Berger, M.L. “Burden of migraine in the United States: disability and economic costs.” Arch Intern Med. 1999; 159: Osterhaus, J.T., Gutterman, D.L., Plachetka, J.R. “Healthcare resource use and lost labor costs of migraine headache in the United States.” Pharmacoeconomics 1992; 2: Patterson, J.D., Simmons, B.P. “Outcomes assessments in carpal tunnel syndrome.” Hand Clin 2002 May; 18(2):359-63, viii.

14 Medical Conditions & Productivity Connections Ambiguous Impairments Ambiguous Impairments High Scores Prevalence = % of ee’s reporting condition Prevalence = % of ee’s reporting condition

15 Health Risk and Absenteeism 1 Risks3 Risks4+ Risks 6.4 Days 9.3 Days 12.6 Days Tsai, et al. JOEM: Vol. 47, No. 8, August, 2005

16 Health Risk and Presenteeism 0-2 Risks 3-4 Risks5+ Risks 14.7% 20.9% 26.9% Source: Burton, et al, JOEM: Vol. 47. No. 8, August, 2005

17 Risk Dynamics – Top STD x Industry & Age > 40 * Based on UPC STD Database/2004 Source: UnumProvident Disability Database,

18 Risk Dynamics – Top Long Term Impairments x Age * Based on UPC Long Term Disability Database,

19... Continuing for Our Working Lives! Age of Workers Percent Growth in U.S. Workforce by Age: Source: US Census Bureau International Data Base

20 Short (STD) and Long (LTD) Term Disability Source: UnumProvident Disability Database, Distribution by age

21 Month Claim Began Quarterly Medical Cost Trend per STD Claimant STD Claim Average Days Duration Trend Quarterly Employee Claimant CostsAverage STD Claim Duration 40% Decrease in Per Claimant Medical Costs 28% Decrease in STD Claim Duration STD Claim Duration to Claimant Medical Costs Discussion: Comparing cost reduction per employee to the claim duration patterns suggests a direct and positive relationship between the two outcomes.

Affective DisordersNormal Pregnancy/DeliveryOther Mental ConditionsIntervertebral Disc Disorders Calendar Days per Claim % reduction15% reduction36% reduction 53% reduction Duration Comparison of the Four Most Frequent STD Conditions Variation in Claim Duration Impact across Conditions

23 (Costs are per claimant incurred during the 90 days immediately following the start of the disability. Costs are adjusted for both claim runout and for inflation.) $2,590 $5,430 $1,500 $4,057 $1,700 $5,708 $1,164 $4,199 $1,837 $5,295 $610 $4,026 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 Affective DisordersNormal Pregnancy/DeliveryOther Mental ConditionsIntervertebral Disc Disorders Quarterly Medical Cost per Claimant Variation in Medical Cost Reduction by Condition 29% Reduction4% reduction60% reduction< 1% reduction Medical Cost Comparison of the Four Most Frequent STD Conditions

24 Bridging the Gaps Through Research & Education Employers and various health and disability partners connect and compete with services. There are clear gaps on how the services are connected with the relative impact only guessed at. Research & education programs can measure a clear sense of impact and accurately communicate innovative combinations and connections.

25 Health & Productivity: What Works? What Doesn’t? What Works –Evidence Based Medicine –Functional Work Capacities –Psychosocial & corporate culture influences –Determining a Return on Investment –Patient centered investigations –Public & corporate policy analysis What Doesn’t –Market research designed to support a target product –“Research” supporting solutions of convenience –The politics of incapacity & competing self interests –Political correctness –Lack of demonstration & application of “model” programs

26 A Proposed H & P Employer Research Agenda Develop & test models for accessible, affordable & effective healthcare Focus on lost productivity & treatment outcomes… –Protecting work capacity in the aging work force –Cancer survivors’ health, productivity and employability –Depression as a comorbid condition –Patient compliance – Patient motivation with metabolic Syndrome Demonstrating unique employer, healthcare, & insurance connections & partnerships Understand and control Iatrogenic/Bureaugenic disability –Avoid/mitigate treatment/physician/employer collisions Prepare Physicians to accurately determine functional work capacity Build work transitions into treatment recommendations – a WorkRx model