If you are like me, you are a little numbed by all of the discussions about rising health care costs. But this morning when I read that Safeway is now spending an amount more than double its annual profits on health care, and health care costs are rising a lot faster than earnings.
While that’s crazy, I bet it’s common.
But the article “Do Health Care Savings Start in the Cafeteria?” written by Melanie Warner for The New York Times offers a recipe for how organizations can get some serious return on investment (ROI) in their wellness spending, that will translate into huge cost savings. While the focus on the article is a company called the Full Yield that offers healthy food for corporate cafeterias, the article stops a little short of what I think the bigger message is.
There is no question that corporate America has looked for ROI on wellness programs, and in many cases it is very hard to quantify. A better question for corporate America is what the ROI is in their health care investment, and you won’t get many responses. I think at the heart of this, there are two very large known problems, but most of America is missing a key statistic that provides a clear path with respect to “how” to solve both problems. The two problems are:
1) Health care costs are growing faster than a runaway train (Safeway is probably the rule rather than the exception)
2) Obesity, depression, diabetes, heart disease, and strokes are all on the rise and that fuels the cost of health care
Some statistics that most people don’t know include:
1) 50%, or 1 in 2 working Americans suffers from major or minor depression (according to the University of Washington)
2) At a cost of $13,500 for annual treatment per person, the cost for diabetes alone in the US was $174 billion in 2007 (according to the American Diabetes Association – the ADA)
3) Diabetes is typically directly linked as a cause of depression, heart disease, strokes, and others
4) In more than 80% of cases, people with diabetes who lose just 6 (six) pounds all symptoms and costs associated with diabetes go away and do not return (according to the ADA)
So the key statistic that I mention above is that the overall bill for American health care would have been roughly $139 billion lower in 2007 if people with diabetes lost at least six pounds. And of course that’s just the tip of the iceberg in terms of costs. By going upstream of the high costs of health care, you are preventing a huge percentage of the heart disease, strokes, and depression that emerge.
That’s how to get a huge start on getting ahead of health care costs, and I bet if you take Melanie Warner’s guidance and have a company like the Full Yield put food in your corporate cafeterias, you will also boost employee morale a lot by showing that you care about their wellness and that takes the form of some great tasting food.
Is all of this talk about diabetes a thin veil over a discussion about obesity? Maybe, though I would assert that there’s less stigma associated with diabetes than obesity, but more importantly, it doesn’t matter – focus on, “what” you want in terms of the outcome of lower costs and higher employee morale, and this is “how” you get there. So what are you waiting for now?
-Ric
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