If we could give every individual the right amount of nourishment and exercise, not too little and not too much, we would have found the safest way to health.
The U.S. spends more per capita on health care than any other country—approaching 18 percent of gross domestic product and over $8,086 per person per year, according to the Centers for Medicare and Medicaid Services. And still, half of all Americans suffer from chronic disease, two-thirds are obese or overweight, and one-third are diabetic or pre-diabetic, reports the U.S. Centers for Disease Control and Prevention (CDC). What’s going on here?
The simple fact is that Americans are making themselves sick. Smoking, poor nutrition, lack of exercise and poor medication adherence contribute to the 70 percent of U.S. health care expenditures that the CDC says are preventable or avoidable.
Why do so many keep making poor health decisions? Research has uncovered two simple findings that have significant implications for the design of health and wellness programs:
1. People make sub-optimal decisions because of limited information, cognitive function and time.
2. The level of risk and the potential for loss is a critical factor to consider when attempting to change human behavior.
Improving Healthy Behavior
Inertia is a powerful force. Our natural state is to do exactly what we’re already doing. If an employer offers a "passive" open enrollment option, people tend to stay in their current plan. But what’s really taking place is not thoughtful reflection to keep their current coverage. What’s taking over is inertia. People don’t take any action because they don’t have to.
Inertia that works against improving health behaviors can be overcome by managing productive tension.
Value-Based Design: Great Hopes, Limited Results
Wellness proponents have been encouraged by the advent of value-based insurance design (VBID). The basic premise, according to the University of Michigan Center for Value-Based Insurance Design, is to align patients’ out-of-pocket costs, such as co-pays and premiums, with the value of health services:
This approach to designing benefit plans recognizes that different health services have different levels of value. By reducing barriers to high-value treatments (through lower costs to patients) and discouraging low-value treatments (through higher costs to patients), these plans can achieve improved health outcomes at any level of health care expenditure. Studies show that when barriers are reduced, significant increases in patient compliance with recommended treatments and potential cost savings result.
Research by the University of Michigan Center for Value-Based Insurance Design and the Center for Health Value Innovation, and recently published articles in the journal Health Affairs ("A Value-Based Insurance Design Program at a Large Company Boosted Medication Adherence for Employees with Chronic Illness," January 2011; "Evidence that Value-Based Insurance Can Be Effective," February 2010) have shown VBID to increase medication compliance and use of preventive and high-value services.
Yet a troubling problem still persists. Why is it that there are still large numbers of people who, despite VBID, remain non-compliant when it comes to medication, prevention and high-value care? What’s missing from today’s VBID approach is the use of productive tension and loss aversion to increase individual engagement and improve healthy behaviors dramatically.
Increasing the Level of Productive Tension
The fundamental tenet of behavioral-based design for health promotion programs is to increase the level of productive tension so it's sufficient to initiate positive behavior change. Productive tension is the balanced increase of individual ability and accountability over their health. Optimum productive tension requires four things:
Information: Information increases knowledge but on its own does not always initiate action. If it did, Americans would not be facing the current health care crisis. All would be fit, rich, thin and happy. Americans spent an estimated $46 billion on diet and self-help books in 2010, yet they still need help. Many know what to do; they just don’t do it.
Incentives: Offering financial or motivational incentives increases accountability, but they do not create action. Buck Consultants' 2011 Working Well: A Global Survey of Health Promotion and Workplace Wellness Strategies found that only 19 percent of employers believe that incentives are “effective or extremely effective” at changing behavior, and 48 percent said their incentive programs were “minimally effective” or “not effective” or said they “don’t know.”
Infrastructure: Having the right combination of programs, practices, tools and technologies is helpful to communicate and assist people. Yet even the most sophisticated infrastructure isn’t enough to initiate action. Companies offer a number of wellness programs, online tools, prevention and disease management programs, and other professional resources that go unused by the majority of their employees.
Imperatives: One of the hardest questions to answer in life is “why?” Imperatives are critical for accountability. People need to know what must be accomplished; the reasons why; the implications of failure and the rewards of success; and their role in achieving that success. Imperatives are critical to understanding, but without the other levers—information, incentives and infrastructure—imperatives will not initiate action.
Balancing these “Four I’s” (see diagram above) is critical to managing productive tension and improving individual and organizational health.
Practical Application of Behavioral-Based Design
Officials at some leading companies understand how behavioral-based design, and the underpinnings of productive tension and optimized inertia, change behavior and improve outcomes.
Safeway offers a great example of understanding and implementing the tenets of behavioral-based design. In 2005 Steven Burd, Safeway's CEO, was presented with information that showed that 70 percent of health care costs were the direct result of behavior and that 74 percent of costs were confined to four chronic conditions: cardiovascular disease, cancer, diabetes and obesity. Over the next five years Safeway redesigned its health care program infrastructure to focus on consumer-based strategies, and then it launched its Healthy Measures wellness initiative. Safeway placed at the center of the Health Measures program an integrated health and wellness portal to allow employees to chart their progress, answer their questions and make clear the implications of success and failure—all of which responded to employee imperatives.
Healthy Measures includes significant financial incentives to achieve specified biometric goals. These incentives increased productive tension, which resulted in changed behavior and improved health.
As a result, Safeway has seen a significant increase in voluntary participation; greater achievement of biometric targets with reductions in rates of obesity, high cholesterol, high blood pressure and diabetes; and greater control over its health care costs.
Pay Attention to the Tension
Under Safeway's Health Measures, if employees take certain actions and reach specific thresholds, they can earn an incentive. Initially, the incentive discounts on medical plan contributions was $780, or $1,560 if the employee and their covered spouse or domestic partner met the thresholds. The questions are: Does that level of incentive get employees' attention? Does it raise their level of tension to consider the action required to achieve the goals that the employer has established?
What about an individual incentive approaching and exceeding $1,000? For most people, the answer is yes, because the incentive is enough to raise their level of tension and make them think about all that they have to lose (remember, loss aversion is a powerful force). A $100 gift card might not get their attention, but $1,000 does. The key is that incentives should be meaningful enough to get attention and motivate action yet not wasteful.
AmeriGas, a national propane service, requires employees to obtain periodic medical exams. If they don’t, they lose their employer-provided health insurance. Compliance is high, because tension is equally high. Mandates increase tension and get people’s attention.
Consider other examples:
• On-site fitness centers. Do they pass the “productive tension” test? No. Fitness centers are a wonderful benefit and promote a culture of health and well-being. Yet without any of the other tension mechanisms to motivate the majority of the workforce to act, usage will be limited to a small percentage of the workforce that's typically already health-conscious.
• Corporate “challenges”? Yes, they pass the “productive tension” test. People are influenced to a large extent by social bias. They like to “be in it together.” That’s why corporate challenge contests have been successful—not because of the programs themselves, but because they create social tension, often with an element of incentive, that initiates motivation and action.
The tenets of behavioral-based design need to be aligned with organizational culture and overall total rewards strategy. What levels of ability and accountability will be most effective in the company? Whenever HR managers consider design changes, remember to ask one question: Will this provision raise the level of productive tension that will cause people to take action?
Seeing Is Believing: Measuring Behavior Change
One of the great things about human behavior is that it can be measured, showing whether people are responding to behavioral-based designs and the use of productive tension management programs. Any lack of action should be an indicator of the need to increase their accountability or ability, depending on the circumstances.
Always pay attention to the success of design elements, programs and practices, specifically:
• What participation, completion and achievement goals have been set?
• Are they high enough to increase the level of productive tension?
• Is HR tracking meticulously the cohort groups that are achieving the desired goals and the impact on health care cost, health risk, absence, disability and productivity?
• Are there tangible results showing the financial impact of the strategy?
Health, Wealth and Career
Behavioral-based design can be applied to all aspects of the employment relationship. When designing health, retirement, performance management or career management programs, the ability to increase productive tension, leverage inertia and focus on the “Four I’s” will influence the behavior that organizations are looking for, leading to improved individual and organizational productivity and sustainability.
The holy grail of health and wellness promotion is the ability to change human behavior to promote health and reduce risk. By increasing productive tension to motivate action, people can be persuaded to take the right steps to volunteer, participate, achieve and believe that they can improve their health and live a long and healthier life.
Remember: Pay attention to the tension.
Rex Gale is a principal at Buck Consultants in the firm's Dallas office. With more than 20 years of consulting experience, his expertise includes human resources strategy, total rewards, human capital management and change management. He has been a leader in developing tenets of behavioral-based health benefits design.
Uncommon Knowledge: Using Health Assessment Data, SHRM Online Benefits Discipline, July 2011
Declining Health of U.S. Works Is Driving Up Employer Costs, SHRM Online Benefits Discipline, April 2011
Meeting the Health Risk Assessment Challenge, SHRM Online Benefits Discipline, July 2010
Health Risk Assessments, Incentives Help Lower Costs, SHRM Online Benefits Discipline, April 2005
Predictive Modeling: Finding the High-Cost Employee, SHRM Online Benefits Discipline, April 2005
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