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Why Population Health Management Matters for Employers

Achieving positive health outcomes for a handful of individuals improves life for patients, but to make a real difference in the cost and quality of health care, it’s necessary to secure progress across an entire population. That’s the goal of population health management: to improve outcomes and lower costs for a larger community of people, such as a company’s own workforce.

Improving outcomes and lowering costs are also the two main goals of value-based care, a payment and delivery strategy replacing fee-for-service arrangements across the industry. Successful population health management drives value-based care — here’s how.

Why Population Health Management Matters to Employers

You may already be familiar with the concept of population health because it’s so closely tied to employee health and wellness. Many employers, for example, offer wellness programs that support employees’ physical and mental health.

These programs benefit employees and employers alike. First, they improve employee productivity and retention. Healthy employees are less likely to be absent from work, and they’re more likely to stay at a job in which they feel supported and valued. They also help employers control the costs of employee health insurance. Healthy employees drive down overall costs and, in turn, lead to lower premium amounts. This is critical during a time when health care costs continue to rise across populations. The total cost of providing medical and pharmacy benefits is estimated to increase 5% this year to a little under $15,000 per employee — an expense of which employers will cover roughly 70%.

Population health takes these programs to the next level to target specific populations. In outlining a more strategic approach to employee health and wellness, population health empowers employees to take control of their own health with the help of health educators, community-based organizations and physicians. Employers should aim to find health plans that prioritize population health management — when employees are healthy, they incur lower costs that translate to the aforementioned lower premiums.

Using Data to Improve Outcomes and Reduce Costs

Successful population health efforts rely on data analytics to assess the needs of each population. This includes analyzing data from electronic health records, pharmacies, labs, insurance claims, health information exchanges, fitness trackers, devices that collect biometric data and other sources.

Data analytics allows providers and health plans to separate individuals into groups based on shared traits such as health conditions, social determinants of health and a variety of other categories. This, in turn, enables specific interventions — for instance, combating obesity with on-site nutritional counseling and healthy food options in the cafeteria and vending machines, or combating tobacco addiction with workplace smoking cessation counseling or a policy for a smoke-free campus.

This is called risk stratification, and it’s a process that providers and health plans should repeat regularly as they gather new data, particularly data indicating that the needs or traits of the workforce have changed.

The Role of Employers in Population Health

Individuals spend the majority of their waking hours at work, so it makes sense that the workplace health models employers design, just like the health plan offerings they choose, play a pivotal role in supporting employees’ population health.

Wellness programs and interventions that target specific populations tend to be particularly effective. For example, the Centers for Disease Control and Prevention (CDC) provides a variety of resources on how employers can create population health management programs for individuals with diabetes, a population with health care expenditures that average a total 2.3 times higher than for those without the disease. Indirect costs related to diabetes include increased absenteeism, reduced productivity and an inability to work. Among the CDC’s many suggestions is that workplace benefit plans offer coverage for services like annual eye and foot screenings, diabetes self-management education and diabetes-related medications. Targeting other employee populations — for instance, those with asthma, depression or hypertension — using specific interventions can be equally beneficial.

Employers should search for a health plan that actively supports population health management with the full set of available tools. That includes connecting with in-network health systems that perform risk stratification and use sophisticated tools to assess population health.