According to a recent report done by the Urban Institute in Washington, D.C., California could save $3.6 million a year by reducing the prevalence of chronic conditions, like diabetes and heart conditions, by just 1 percent.
Furthermore, according to the report, the state could save between $18 million and $54 million if between 5 percent and 15 percent of its government employees prevent a number of chronic illnesses.
Tim Waidmann, senior fellow at the Health Policy Center at the Urban Institute and the lead author of the report, said he used data from the California Public Employees’ Retirement System (CalPERS) in regards to what diagnoses many people had and their demographics. The excess cost of many preventable chronic conditions, such as high blood pressure, heart disease and diabetes, was then estimated. According to the study, CalPERS spent $1.6 billion on healthcare in 2008, with 22 percent ($362 million) going toward preventable chronic conditions alone.
“The point of the report is to illustrate the magnitude of the health plan’s expenditures that could be targeted by disease prevention efforts,” said Waidmann. “The idea is that these are all things we know how to reduce the prevalence of with preventative measures like exercise and other wellness activities. In many of these cases it could have been prevented and therefore saving costs. While the data we analyzed were specifically from the CalPERS system, I think the results are likely of interest to other large employers. Within the population of California’s state employees, the analyses might also be helpful in identifying specific agencies, geographic areas, health plans or demographic groups where the preventable disease costs are largest.”
With so many healthcare dollars spent on preventable conditions, California officials recently launched a workplace wellness initiative to help state workers get fit and lower medical costs.
“They will be starting with two departments as a pilot program to determine how effective the program is and to what extent. I think that community-based interventions can be effective, and there are ways to improve health with fairly simple changes,” said Waidmann. “The result is you get workers healthier, which is good for them, but it's also good for you as an employer. It’s one of many strategies that should be used to tackle the health cost issue.”
In addition to government employers, hospitals and health systems are joining the employee wellness movement, establishing no-smoking rules, enrolling workers into exercise programs and offering healthy foods in the hospital cafeteria to keep their workers healthy.