When it comes to managing employee health--preventing illness and injury and delivering medical and disability benefits, on or off the job--employers often believe that changing employee behavior and perception is the solution. Saying employers have their employees' best interests at heart and believing it, however, can be two different things. Employees who don't view employers' involvement in their well-being favorably may actually have good reason. Here's one employee's perspective:
"When I hurt my back at home on the weekend, I have to use the new managed care program that has a certain network of doctors available to me. I'm told that `this is the very best health plan for our employees' and that I can stay out of work as long as I need to recover, with nobody checking on me at all.
However, if I hurt my back at work on Monday, I'm sent to a different doctor and required to come back to work on light duty almost immediately. Well, I'm not sure what is in my own best interest, but I am sure that my supervisor is more interested in managing this year's budget than my well-being."
Many employers have been in the 24-hour healthcare business for a long time, by default, but before they can hope to influence employee behavior, they need to design more efficient and effective healthcare delivery systems. There is potential for loss for any company if an employee is injured or gets sick; losses can include medical expenses, wage replacement and intangible costs (such as lost customers or reduced product quality). Therefore, employees' and employers' interests are fundamentally the same: Employee health equals corporate health.
At times, this simple equation may be difficult to remember. But once its importance is realized, risk and human resource managers can focus on much more effective management of their organizations' most crucial assets--their people.
Historically, the organizational structure of most corporations has been designed to manage programs, not people. Medical benefits, workers' compensation, wellness, safety, employee assistance programs and disability management are all tactical initiatives related to employee health. When these programs are examined collectively, corporations can begin to explore how to leverage these traditionally separate investments to increase productivity, reduce expenses and improve employee relations. This process requires merging healthcare strategy with people risk management.
However, the integration of these programs contradicts the structures of existing insurance products. In fact, the insurance industry has recently taken steps to further disassociate certain aspects of employee health care. Consider, for example, Travelers getting out of the employee benefits business even as it kept workers' compensation as part of its casually operations; and Aetna spinning off its casualty business, including workers' compensation, as it fumed its focus to employee health care. Yet, the most manageable elements of workers' compensation are, fundamentally, employee benefits: providing medical care and wage replacement for employees injured on the job.
Meanwhile, in the modern work environment, the lines between work life and non-work life blur, diagnoses blend and identifying the causes of injures or illnesses can become complicated. Psychosocial factors begin overlaying biomedical factors, and the ability to differentiate between work-related and non-work related illness and injury diminishes. Employers should focus on employee health and the effective delivery of care, but clarifying that this is a fundamental objective requires a significant transition from the insurance product-based structures used by most corporations.
If the separate costs of an employee's health care (employee medical, workers' compensation and health-related absences such as sick leave, short-term disability (STD) and longterm disability (LTD)) are added together, the total cost to most organizations may be 8 percent to 12-percent of payroll on a direct basis, and perhaps 4 percent to 6 percent more for indirect costs and lost productivity. …