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Employers See Increasing ROI from Disease Management Programs

With healthcare costs rapidly rising, stakeholders are looking for ways to better manage the health and chronic conditions of our country’s population
By Validic
05:08 pm

By: Jennifer Plumer, Director of Market Development, Validic

With healthcare costs rapidly rising, many stakeholders—including payers, providers, pharma, wellness companies and employers—are looking for ways to better manage the health and chronic conditions of our country’s population. For the 157 million Americans in the civilian workforce, who has more daily access and the opportunity to help encourage better employee health than the employer? That’s why many employers have begun offering corporate wellness programs for employees over recent years.
The phrase “corporate wellness program” oftentimes conjures up thoughts of employees competing in step challenges or logging physical activity for incentive programs. While tracking step count might be a good start, the wellness industry has continued to look for new ways to thrive in this transformational healthcare industry that go beyond the commonly thought of lifestyle management programs (exercise, diet, smoking cessation, etc.).
Better disease management is vital in addressing overall healthcare costs, as 86% of U.S. healthcare spending is for patients with one or more chronic conditions.
Employers have taken note of this. According to the Kaiser Family Foundation/Health Research & Education Trust 2015 Employer Health Benefits Survey, 68 percent of employers with more than 200 employees currently offer disease management programs, which are targeted to employees with an existing chronic condition like diabetes, asthma and so forth.
And the ROI for offering these programs is clear. Rand conducted a study, Do Workplace Wellness Programs Save Employers Money?, examining 10 years of data from a Fortune 100 company’s wellness program. For every dollar the employer spent on wellness programs, $0.50 was returned for lifestyle management programs, while the return on investment for disease management programs was $3.80.
Contributing to the success of these disease management programs are the connected clinical devices that consumers can use at home. These includes connected glucose meters, blood pressure cuffs, weight scales, thermometers, spirometers and more that are often used to better manage chronic diseases. With continuing advances in technology, these in-home devices are becoming smaller, easier to use and more cost-effective, making buy-in easier for employers and employees alike. Additionally, some technology companies are helping wellness companies easily integrate the data from these devices directly into the systems they use.
The insights derived from these data sets are changing the way chronic disease are managed and enabling cost savings. Livongo, a consumer digital health platform, is reinventing the way diabetes is managed through their end-to-end solution that combines a connected glucose meter and personal support. And like the Rand study results, Livongo’s customers are seeing significant returns, as well. On the recent webinar, Wearables in Wellness: Providing Insights that are Impacting Lives, Livongo executive Jim Pursley shared a customer success story. A large, self-funded employer using their platform saw 2.5x ROI from total medical cost reduction. For employees enrolled in the program, the employer saw medical cost savings of $186 per member per month (PMPM).
Large employers have led the charge with integrating disease management programs into their employee wellness offerings, but there is a real growth opportunity for the smaller employers. The Kaiser Employer Health Benefits Survey 2015 also reported that only 32% of employers with less than 200 employees offered disease management programs.
The wellness industry is crowded and changing rapidly. For wellness companies to remain competitive, it’s clear they need to continue evolving their offerings—both lifestyle management and disease management programs—and integrate other sources of employee information like those data sets from digital health devices and apps.
But greater than a competitive edge is the opportunity that wellness companies and employers alike have to make a substantial impact on the country’s overall healthcare spending if their disease management programs are able to successfully, and on a large scale, improve employees’ overall health and chronic conditions.

About Jennifer Plumer
Jennifer is the Director of Market Development at Validic, the industry’s leading digital health platform. Validic connects actionable data from fitness and sport wearables, clinical devices, biometric sensors and mobile applications to healthcare, pharma, wellness and sport companies. Jennifer has more than ten years of experience building and executing strategic go-to-market and demand generation plans for B2B companies.




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