Authored by Beth Umland, Partner and Director of Research, Health & Benefits, Mercer
Beth Umland is Director of Research for Mercer’s Health & Benefits (H&B) business. Beth and her staff oversee all survey research produced by the H&B business, including Mercer’s flagship National Survey of Employer-Sponsored Health Plans. She is also a core member of the HERO Scorecard workgroup, which provides ongoing development of the HERO Scorecard and oversight of data analysis using HERO Scorecard benchmark data
Nearly 600 organizations have now completed Version 4 of the HERO Health and Well-being Best Practices Scorecard in Collaboration with Mercer© (HERO Scorecard). While there are substantial differences between Version 4 and Version 3 – which was completed by more than 1,200 employers over the course of 4 years – many best practices were carried over. This allows us to compare a subset of questions to learn how prevalent the HERO Scorecard best practices have become and how fast they’re growing.
To compare the use of best practices over time, we use data collected from 624 employers who completed HERO Scorecard Version 3 from 2009 to 2011 and data collected from 555 employers who completed HERO Version 4 from 2014 to 2016. (We left a gap of two years so that changes in prevalence would be easier to see than if the timeframes were contiguous). For simplicity, we’ll refer to the earlier dataset as 2011 and the current dataset as 2016.
Past analyses of HERO Scorecard data have shown that employers with formal, written strategic plans for employee health and well-being were more likely to report positive outcomes in terms of medical plan savings and improved employee health. More than half of respondents in 2016 (56%) have a formal strategic plan in place, compared to 44% in 2011. In Version 4, respondents were asked to gauge whether leaders understand the strategic importance of employee health and well-being: “To what extent is your program viewed by senior leadership as connected to broader business results?” About a fourth responded “To a great extent,” whereas 20% reported that it isn’t seen as connected at all to results.
Organizational and cultural support
Recognizing that health and well-being programs don’t operate in a vacuum, the HERO Scorecard asks detailed questions about organizational and cultural support strategies. One significant way to demonstrate commitment to and maintain focus on supporting employee well-being is with the company vision or mission statement. However, only 35% of HERO Scorecard respondents in 2016 say their company vision or mission statement supports a healthy workplace culture, up just slightly from 32% in 2011.
As other analyses of HERO Scorecard data have shown, one of the sharpest differences between respondents that have seen significant improvement in health risks and those that haven’t is in the percentage saying leaders actively participate in health and well-being programs. There was modest improvement in this best practice from 2011 (46% of respondents said leaders actively participate) to 2016 (53%). However, only 23% of current respondents say leaders are role models for prioritizing health and work-life balance (for example, they take activity breaks during the day, they don’t send email while on vacation and so on).
Because core health and well-being programs such as health assessments, lifestyle coaching and chronic disease management were already common in 2011, there wasn’t much growth in offerings between 2011 and 2016. Of the new types of programs included in Version 4 of the HERO Scorecard, the use of monitoring or tracking devices was far more common among employers with the best cost outcomes (58%) than with those not seeing an impact on cost (17%). Past analysis of the HERO Scorecard data shows a link between employer use of technology such as wearables and higher participation rates — a leading indicator of program effectiveness. While further study is needed to determine the effectiveness of these devices, these early findings suggest that new technologies that can create a more personalized, real-time experience for users may ultimately have considerable impact.
Respondents in the 2016 database still have plenty of room for improvement in ensuring their health and well-being programs are effectively integrated with each other, the health plan, the safety program and disability programs. In 2011, just 27% of respondents said “stakeholders are required to provide warm transfer of employees to another program.” In 2016, just 34% of respondents say “partners provide warm transfer of individuals to programs and services provided by other partners.” In addition, only 24% of current respondents say their health and well-being program is integrated in any way with disability programs. This represents a significant opportunity for employers, because employees may be more ready to engage in health promotion programs when struggling with a significant health issue.
Employee communication and incentive design significantly affect participation rates and program outcomes. Although financial incentives help drive participation rates, communication efforts are even more strongly related to positive health and financial outcomes. In 2016, 62% of all HERO Scorecard respondents — and 76% of those with 5,000 or more employees — brand the health and well-being program with a unique name and logo. In 2011, just 57% of all respondents and 66% of those with 5,000 or more employees had this best practice in place. Year-round communication has also become more common. In 2016, 71% of respondents communicate about the program at least quarterly, up from 60% in 2011. About two-thirds of current respondents (67%) use some type of financial incentive in connection with the program, and nearly all of these are communicated as rewards rather than penalties. Incentives for participating are the most common, but 30% of respondents provide a financial incentive to achieve, maintain or show progress toward specific health status targets. Respondents report that, on average, 57% of eligible employees earn at least some of the available incentive and 38% earn the maximum incentive. Although financial incentives are widely used, 38% of respondents say their engagement strategy intentionally includes a focus on increasing employees’ intrinsic motivation to improve or maintain their health.
Association with Outcomes: Turnover is lower among high-scoring respondents
Proving the value of an investment in employee health and well-being remains a challenge, and one of the goals of Version 4 of the HERO Scorecard is to encourage employers to consider the full range of outcomes rather than just financial returns. One intriguing indication of the value of a robust health and well-being program comes from a simple comparison of turnover rates based on score. We arrayed HERO Scorecard respondents based on their scores, from lowest to highest, and divided them into three roughly equal groups: those with scores of 73 or below, those with scores of 74–110 and those with scores of 111 or higher. Not surprisingly, the highest-scoring group was more likely to report improvement in medical trend and health risk. But they also reported an average turnover rate of just 12%, compared to 15% in the medium-scoring group and 17% in the low-scoring group. An organization that scores highly on an assessment of its support for employee health and well-being is likely doing a few other things right as well. But it makes intuitive sense that employees who work at a company that invests in their health and well-being will be inclined to stay there.
Data cited in this commentary are based on HERO Scorecard responses submitted through June 30, 2016.