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Dear Wellness, Diabetes, Clinic, Price Transparency, and Medication Therapy Management Vendors,
While most of you already know the majority of these tricks, there might be a few you haven’t deployed yet. So take good notes.
PS If you are an employer, just pass this along to your vendors…and watch your savings skyrocket. Or use “An Employer’s Guide to NOT being snookered” to see your savings become realistic.
Best practices for every vendor
Compare participants to non-participants. Using non-participants as a control for participants allows you to show massive savings without doing anything. This is not an overstatement. Here is a program — which naturally won an award for its brilliance from Ron Goetzel and his friends before I observed that they were a fraud according to their own data– that did just that. They separated participants from non-participants but didn’t bother to implement a program for two years—by which point the participants had already improved by 20% vs. the non-participants — without even having a program to participate in. (Note on this slide that the control and study group were set up in 2004 but the program didn’t start until 2006, when the cost separation had already reached the aforementioned 20%.)
Two other observational trials support this conclusion. Most recently, the National Bureau of Economic Research ran a controlled trial to test exactly this hypothesis. Sure enough, like the three observational trials, they found that virtually the entire outcome in wellness can be explained by that popular study design itself, rather than the intervention.
In any participation-based program, ignore dropouts. Assume that employees who drop out do so randomly, not because they are discouraged by their lack of progress or interest.
Draw a line upwards and then claim credit for the “savings” between the actual upward spending and the “trend” you drew. As Optum’s Seth Serxner stated so succinctly: “We can conclude that the choice of trend has a large impact on estimates of financial savings.”
Start with the ridiculously high utilizers, high-risk people, or people taking lots of drugs. Let the group regress to the mean, and then claim that as savings.
Never admit, like Wellsteps did, that you are familiar with regression to the mean, since most employers are not aware of it. The higher the costs/risks of the original users, the more savings you can claim. Here are two verbatim claims:
- A heavy equipment manufacturer found high use of the ER was a becoming a cost concern, so it send mailings that showed appropriate care settings to the homes of members with two or more visits to the ER in the past year. As a result, ER visits were down 59 percent those who got the mailing.
- A pharmaceutical company saw a spike in ER claims was coming from repeated use by the same people, so two mailers were sent: one to households with one ER visit in the past year; another for those with two or more visits. Following the mailings, there was a 63 percent drop in ER visits.
Pretend not to notice that low utilizers can show an increase in utilization — or especially that low-risk people can increase in risk. Focus the mark (I mean, the customer) on the high-risk people who decline in risk. Never draw graphs to scale, or your customer might notice that 2/3 of their employees are low-risk in the first place.
It doesn’t matter what your intervention is. Claim credit for the entire difference in trend. For instance, in this example, Community Care of North Carolina claimed credit for a huge reduction in PMPM costs for babies for their medical home program…but babies weren’t even included in the program. (Neonatal expenses didn’t decline either.)
Or do what Safeway did, launching the wellness craze: change to a high-deductible plan, and transfer a large chunk of costs to employees. Don’t even bother to institute a wellness program, but attribute all the savings (from the transferred deductible spending) to wellness anyway, so that you get invited to the White House. And after that blows up on you, demonstrate that your very stable genius investment in wellness was not a fluke by investing your company’s money in Theranos.
Special Instructions for transparency tool vendors
Assume that every employee who uses your tool is looking to save their bosses some money, rather than (for instance) to find the closest MRI…and that none of them would have used a lower-cost venue absent your tool.
If only 10% of employees use your transparency tool, and only 10% of events are shoppable, nonetheless take credit for the entire difference in trend across the board, and ignore the literature showing online price-comparison tools don’t work.
If people who haven’t met their deductible shop more than people who have, attribute the former’s lower cost to use of the tool, rather than to the fact that by definition people who don’t meet their deductible spend less than people who blow through it.
Special instructions for wellness and diabetes vendors
If you are a wellness or diabetes prevention/management vendor, never ever let employers know that every year since statistics have been kept, fewer than 1 in 1000 employees/dependents end up in the hospital with diabetes. (And another 1 in 1000 with a heart attack.) Always tell them how many employees are at risk and how many “newly discovered conditions” they have, and how they will all end up in the hospital, even though hospitalizations for heart attacks and diabetes in the employer-insured population have been declining for years.
Wellness vendors should always put the trivial percentage reduction in risk (for participants only, of course – and ignoring dropouts) on one page and the massive savings on another page. Most employers won’t bother to do the math to notice, for example, that Interactive Health claimed $50,000 in savings for every employee who reduced one risk factor, while the state of Nebraska won an award for claiming to save $20,000+ for every risk factor reduced, as did Staywell for British Petroleum.
If you didn’t reduce risk factors, present your outcomes in a format no one can make heads or tails of, like this one, from Wellsteps. If Wellsteps was able to snooker an entire committee of self-anointed outcomes experts to win an award for program excellence, surely you can snooker a few customers.
Claiming people lose weight is a big part of your outcome reporting, so make sure to do the following:
- Never count nonparticipants, and ignore dropouts.
- Don’t do any long-term follow-up to see who regained the weight (most participants)
- Give them time to binge before the initial weigh-in
Special instructions for diabetes vendors
In addition to measuring on active participants only, raise the bar for Hb A1c so that only people with high Hb A1c’s can be included. That belt-and-suspenders approach will ensure that you can’t fail to show savings, even if (as is likely the case) you don’t change anyone’s behavior other than the employees who were going to change anyway, which you might as well count.
Next — most diabetes vendors and a few wellness vendors have already figured this out — you can charge much more if you can submit claims, rather than just be an admin expense line item. You see, most employers focus much more on the 10% admin expense than they do the 90% medical expense, which they consider to be beyond their control. Your claims expense – which would draw attention to itself as an admin cost — won’t get noticed in the 90% of medical losses, sort of like the dirt from the tunnel sprinkled around the Stalag in The Great Escape.
Special instructions for medication therapy management vendors
Only mention “gaps in care” that you close, not the ones that open up. And, as noted in the chart below, always use percentages. So in this chart (provided by one of the major PBMs), they claimed that twice as many gaps were closed (37%) vs opened (18%), and yet, as is almost always the case with MTM vendors, nothing happened to the total number of gaps, which remained at exactly 820:
Tally all the employees who were on large numbers of meds and now take fewer. But don’t mention all the employers who were on fewer meds and now take more.
What to do if you’re asked why you aren’t validated by the Validation Institute
Here are the most popular answers to that question:
- No one has asked us to. (Quizzify didn’t need to be asked.)
- We hired our own outside actuarial firm to validate us, and they concluded we save a lot of money.
- Sure, we’ll get validated as soon as you sign the contract with us.
Is your wellness vendor snookering you? There are certain facts that vendors are not exactly forthcoming about. This is because facts represent an existential threat to the “pry, poke and prod” industry. See how many facts you know — and how many they’ve suppressed — by taking this quiz.
You’ll earn more points, the closer you are. You don’t have to be exact — and honestly I’d worry about you if you got the exact answers to every question. I’d love you for it, but I’d still worry about you.
- Wellness vendors claim they can save significant money by reducing hospital admissions for diabetes and heart attacks, because those admissions are very common. How many admissions per 1000 covered lives does the average employer incur in a typical year?
The Health Enhancement Research Organization claims a certain savings figure for wellness PEPM. But that’s before taking into account vendor fees, extra doctor visits, tests, and prescriptions, compliance issues, employee time needed, overhead and basically anything else. In other words, what is the PEPM savings figure that at Bain & Company we used to refer to as “profit before cost”? Answer to the nearest one dollar. Hint: the answer is somewhere in this quiz.
To eventually save money someday, you first need to improve/reduce the risk profile of your population. According to eternal optimist and wellness promoter-in-chief Ron Goetzel, what is the maximum percent improvement in a risk profile that a company can expect after 2 to 3 years of wellness programming @$150 PEPY?
Speaking of Ron Goetzel, he said “thousands of wellness programs” fail to get good outcomes. What round number did he claim have succeeded?
And speaking of Ron Goetzel again, he finally admitted it was “hard” to force employees to change behavior. How many “very’s” did he put in front of the word “hard” in that admission?
The Wishful Thinking Factor, totally coincidentally abbreviated as WTF, is defined as: Total claimed cost reduction/total number of risk factors reduced. What is the average WTF for the last six Koop Award-winning programs, on average? (Hint: the real ratio of savings to risk reduction is about 0.05x, since even if savings does not lag risk reduction, a maximum of 5% of spending is wellness-sensitive.)
Speaking of risk reduction, employees in the most recent Koop Award-winning program, Wellsteps/Boise, originally tallied 5293 risk factors. Approximately how many risk factors did those same employees tally after participating, excluding dropouts?
In a participants-vs-non-participants study design, what percent of the perceived savings is due to the invalidity introduced by the study design itself in which unmotivated employees are used as the control for motivated employees, rather than health improvements attributable to the actual program itself, according to all four studies conducted on this topic, including three by wellness promoters?
If you use Interactive Health as a vendor hyperdiagnosing the stuffing out of your workforce, what is the annual percentage of employees that will likely be told they have “newly discovered conditions” that “require” a doctor’s intervention?
Of 1000+ wellness vendors, how many are validated by the Validation Institute?
- 2. Yes, only 2. All this wellness fuss is about 2 admissions per 1000 employees. Derivation: the roughly 150,000,000 employees and dependents covered by commercial insurance (mostly from employers) generate roughly 150,000 heart attacks and 120,000 diabetes events. See the HCUP database and enter “410” for heart attacks and 250 for diabetes admissions for the ICD9 for the most recent full year (2014). Scoring: Give yourself 1 point for guessing 4 to 10 and 2 points for guessing fewer than 4.
- One dollar. $0.99 PEPY. As is well-known, they tried to walk this figure back once they realized they had told the truth. Scoring: Give yourself 1 points for guessing $1.00, since the answer in the hint was on that very same line.
- 2%. That’s a few dollars PEPY in savings. (Looks like the HERO report was pretty close, its own protestations notwithstanding.) And you paid $450/employee over 3 years to achieve it. Actually it was 1% to 2%, but we asked for the maximum. Scoring: Give yourself 2 points for 2% or less, 1 point for 4% or less.
- Only 100. Besides Johnson & Johnson, Mr. Goetzel has never disclosed any of the other 99 without others making the observation that they self-invalidate according to their own data. Scoring: 2 points for 200 or fewer, 1 point for 400 or fewer.
- 4. In The Healthy Workplace Nudge, Rex Miller gets Ron Goetzel to admit that “changing behavior is very very very very hard.” Gosh, Ron, do you suppose this might explain why an employer population’s risk factors never noticeably decline? Scoring: 2 points for 4, 1 point for 3 or 5.
- Infinity. That’s because of the next question. The 21% risk factor increase for Wellsteps more than offset the trivial risk reductions achieved by the previous years’ winners. The actual WTFs for the previous years will be the subject of a future posting. Scoring: give yourself a point if you guessed that the WTF was 5 or higher. That would be 100 times the actual figure and still way below the wellness fantasy-league figure.
- 6397. Risk factors rose 21%. And yet somehow, even though the risk profile was deteriorating sharply, the risk profile of the population was also improving enough for Wellsteps to claim that healthcare costs declined 30%. 30% is enough to wipe out wellness-sensitive medical events for the entire Boise teacher population and about 30,000 of their closest friends. (Wellsteps originally admitted that costs increased, but took that slide down when it occurred to them that telling the truth would be inconsistent with their marketing strategy.) Scoring: 1 points for 5500 to 6000 or 6600 to 7000, 2 points for 6001 to 6599.
- 100%. It turns out that the participant-vs-non-participant study design is responsible for all the perceived savings that wellness vendors claim for programs. The New York Times just explained how, in the landmark University of Illinois study, both the “gold standard” RCT methodology and the invalid par-vs-non-par methodology were used and had completely different results. This also happened three other times (summarized here) — with Newtopia, Health Fitness Corporation, and a study done by the chairperson of the Koop Committee showing how feeding diabetics more carbs would reduce their costs by improving their health. Literally, 4 studies — all of which were run by people trying to show savings — showed exactly the same thing. Scoring: all or nothing — 1 points for 100%.
- 45%. This is because running 40 inappropriate tests on every employee makes it inevitable that at least 1 or 2 of those tests reveal a false positive. Scoring: Give yourself 2 points for guessing between 40% and 50%, 1 point for 30% to 39% or 51% to 60%.
- Four. All four are honest and make modest claims they can defend or valid contractual representations. AND, they actually screen according to guidelines! (In the wellness industry, doing something appropriate merits an exclamation point.) They are: It Starts With Me, Splashlight, Sustainable Health Index, and US Preventive Medicine. That’s <1% of all wellness vendors. Scoring: give yourself 1 points for 8 or fewer.
0-2 points. Has your wellness vendor sold you a bridge too?
3-5 points: Your wellness vendor is blocking your internet connection
6-9 points: Nice work!
>9 points: Send your fifth-grade math teacher a thank-you note for doing a better job than the wellness vendors’ teachers did.
Four of the most stable genius vendors in the wellness industry have penned a letter to Montana’s junior senator, in which their usual wellness savings propaganda — contrary to all evidence, of course — ends with a plea to confirm EEOC appointees who they hope will institute new rules by January designed to allow them to continue to harass employees in order to enhance their own revenue streams.
Being wellness vendors, naturally they got the facts wrong. Even if a new chairperson were appointed, the EEOC has already said it won’t issue rules by January. Besides, the idea of just adding a staff member and then immediately issuing rules is ludicrous. Anyone with any insight into how the rulemaking process works knows that’s not how the rulemaking process works.
Facts and insights are two of the many things wellness vendors have trouble comprehending, along with data, integrity, math, and — as we’ll see below — irony. (And, also, as we’ll see below, wellness.)
Their specific language:
Without clear guidance from the EEOC, we fear a Wild West of litigation could re-emerge as did it prior to the EEOC guidelines…jeopardizing programs that are improving the health of America’s workforce.
For months, we have been urging companies to take an obvious and painless step — requiring no government regulation or intervention or plaintive pleas to seemingly random junior senators from seemingly random states — to insulate themselves from this pending “Wild West” litigation.
Specifically, by offering alternative vendors such as Quizzify to indemnify themselves from this possibility, employees save money immediately and educate employees at the same time they avoid liability.
Having to offer Quizzify would be these vendors’ worst nightmare (since most employees would much rather learn something useful than be screened and told to eat more broccoli), and yet the letter’s four signatories are probably the four vendors most likely to be sued by employees if they don’t offer Quizzify as an alternative. Let’s look at each in turn.
Bravo is the only vendor in the wellness industry to publicly brag about how much “immediate employer cost savings” can be obtained by fining employees who decline to have the stuffing screened out of them in violation of all US Preventive Services Task Force guidelines. Of course, Bravo’s program itself saves no money according to its own findings. There is also a question about their financial solvency, since they apparently can’t afford an internet connection.
Health Fitness Corporation
Health Fitness Corporation (HFC) bragged incessantly about its “life-saving, cost-saving catches” of 514 Nebraska state employees who had cancer. This was fairly easy to accomplish because it turned out, as HFC later admitted that they didn’t have cancer in the first place. (Ron Goetzel kindly forged a portion of a letter from Nebraska’s Governor to replace the old braggadocio with the new admission. I have to give him credit for loyalty here. He was willing to risk a felony charge in order to support his friends.)
Bragging about how many sick employees they hyperdiagnose is a pillar of the wellness industry. In this case, HFC found all these false positives likely because they “waived” screening guidelines so that anyone of any age could get a colonoscopy, and sent out solicitations featuring a model way too young to be indicated for one.
“Waiving” screening guidelines is the wellness industry equivalent of “waiving” the minimum age requirement for a driver’s license. Fortunately for the very stable geniuses in the wellness industry, there is no regulation requiring wellness vendors to understand what they are doing, and they take full advantage of that loophole.
HFC also saved 20% on a wellness program with Eastman Chemical. This was also quite easy to accomplish because it turned out they didn’t even actually have to implement the program. Simply splitting the group into participants and non-participants did the trick. As you can see from their Koop Award application below, the program already “saved” about 20% between 2004 and 2006 during the baseline period, before they started giving employees the aptly named “treatment.”
The Incidental Economist was very impressed with this study design. (Not!) But I’ll tell you who really was impressed: Ron Goetzel. He gave HFC Koop Awards for both studies. For those who are not familiar with the it, the Koop Award recognizes the most stable geniuses in the wellness industry who are also sponsors of the Koop Award.
Wellness Corporate Solutions
Along with whining about how “shrill” I am (examples being…?), Wellness Corporate Solutions is worth “siting” (add English to the list of things wellness vendors don’t understand) for its crash-dieting contests, in which employees binge and then starve themselves to win prizes. Lately they’ve added a new twist: water-drinking contests. Obviously the first is bad for you. Overhydration turns out to be a bad idea. It doesn’t exactly enhance your productivity, if you catch my drift. Oh, yeah, and you also have to make sure you don’t die.
Viverae may or may not harm employees. Obviously it fabricates its savings (claiming a $739/employee savings on a health score improvement of 2.4% creates an industry-leading Wishful Thinking Multiplier of 307), but catching a vendor lying is dog-bites-man in this industry. The more amusing thing is their “savings guarantee” which, this being the wellness industry, doesn’t guarantee savings for many reasons, not the least of which is there are none. You also have to “require” employees to submit to screens. No wonder they are worried about being sued.
Here is a guarantee of my own: I guarantee (and will put all consulting fees at risk) that I can prove that if Viverae says you saved anything, you didn’t.
Here’s another guarantee: while hiring these wellness vendors may very well get you sued, this one flyer (plus the Quizzify indemnification) will prevent that from happening.
A word means whatever I want it to mean, neither more nor less.”
Like George Orwell and Humpty Dumpty, the wellness industry (thanks largely to the Business Roundtable pressuring the EEOC) has now managed to redefine wellness programs as their opposite: “voluntary” now means “required,” in the sense that if you don’t volunteer to submit to “wellness or else” you could be fined up to about $3600 (if you spouse is on your insurance), which is a little less than 10% of the median annual wage, and exceeds the amount in many people’s savings.
But the wellness program is still voluntary, according to the EEOC. Or as Surviving Workplace Wellness says: “wellness programs will make employees happy whether they like it or not.”
These wellness people have experience at redefining words as their opposites. Health Fitness Corporation’s Dennis Richling redefined “514 Nebraska state employees didn’t have cancer at all” to “we made life-saving catches of 514 employees with cancer.” He referred to this subtle difference as “semantics.”
Jon Robison and I just posted a “Pulse” on the wellness industry’s creative use of the English language, which rivals their creative use of fifth-grade math.
We hope you hate it, where “hate” means “love.”
No program epitomized conventional “pry, poke and prod” wellness more than Nebraska’s state employee wellness program. And by that of course I mean no wellness vendor has ever lied about outcomes more blatantly or won more awards than Nebraska’s state employee wellness program vendor, Health Fitness Corporation. (Blatantly lying about outcomes and winning Koop Awards, in the immortal words of the great philosopher Frank Sinatra, go together like a horse and carriage.) Their big mistake was admitting it. (See the timeline link.)
Not to mention the cover-up of the lies, that Ron Goetzel and his Koop Committee friends botched so badly that the state’s HR team and procurement department could no longer do the Sergeant Schultz thing. I guess now, finally, Mr. Goetzel will stop referring to this program as a “best practice.”
Now, the program is officially dead. It was close. On October 1, we thought we had lost:
But then last week, following a number of behind-the-scenes conversations and finally a bit of googling by the state:
In other words: