Large employers offer healthcare benefits to employees for fairly straightforward reasons: to help with recruitment and retention, and to have healthy, productive employees. But two megatrends affecting the country as a whole proportionally affect those larger employers: an older, less-healthy workforce and increasing healthcare costs.
Companies such as Iron Mountain, a leading global supplier of storage and information management services, illustrate the difficult math of employee healthcare. Servicing 225,000 customers from 1,400 facilities, the Boston-based company has eight thousand employees in the US alone, plus another eleven thousand in the more than fifty countries where it operates. With people constituting so large a portion of the company’s assets, healthcare is both a competitive and financial factor.
To Iron Mountain’s credit, their employees tend to stick with the company over years and even decades, which means it’s successful on the recruitment and retention front. But the growing company has wrestled with how to improve employee well-being and its implications for productivity. The company’s director of benefits strategy, Scott Kirschner, has as good an understanding as anyone about the rising costs of healthcare as well as the increased expenses associated with an aging workforce.
One fairly common chronic disease tells the story. The prevalence of diagnosed Type 2 diabetes mellitus ranges from 6–9 percent among employees in large companies. A 2013 report from the American Diabetes Association itemized what this single disease costs American businesses: $5 billion in increased absenteeism and $20.8 billion in reduced productivity while at work, with an additional $7,900 in medical expenditures per employee (more than double the costs of employees who are not diabetic).
Aside from the health and financial issues caused by diabetes, the disease offers one advantage: the more patients know and adhere to mitigating strategies, the less sick and costly they are. Proactive communications and education programs—aided by smartphones, data analytics, and artificial intelligence—can reduce those costs and improve the health outcomes for affected individuals.
But few companies have all the resources needed to manage these tasks in-house. Therefore, Iron Mountain engaged several benefits management firms in just the past couple of years to provide these analytical, communications, and education tools.
One firm is Livongo Health, a diabetes management start-up launched in 2014 by former Allscripts CEO Glen Tullman. The company provides coaching and management around diabetes, in addition to other chronic diseases. With the use of artificial intelligence and blood glucose monitoring, connected via smartphones, Livongo’s program coaches patients on real-time dietary adjustments to manage the disease on an ongoing basis. In an efficacy study, the Livongo program reduced patients’ mean HbA1c (a measure of long-term blood sugar levels) from 7.8 to 6.9 percent in one year, which reduces the likelihood of such debilitating and expensive complications such as kidney failure, blindness, heart attacks, and strokes.
“Livongo has really connected with our people who have diabetes,” says Kirschner. “We’re seeing improved clinical results and cost savings, which have been documented by independent consultants.”
Another firm working with Iron Mountain is bswift, a human resources and benefits administrator that offers streaming video to explain Iron Mountain’s benefits program to its employees. “We have a very dispersed workforce, so it’s virtually impossible to physically be out there and enroll every employee,” says Kirschner. “Prior to bswift, we had only 1 percent of employees do employee self-service. Now, 87 percent of employees now go online to sign up and manage their benefits packages.”
Kirschner credits the usability of the technology for this high adoption rate. “Our employees find it very easy to navigate, very easy to find things,” he says. “Key for us—because most employees are expected to be doing records management, with many of them on the road—is that we don’t want them to spend too much time searching for things. Something else the video gave us is it reduced the number of calls into our employee service center about open enrollment. We actually saw the number of tickets decline, which allowed our team to better respond to the tickets that came in.”
The provider network offering is another key element of Iron Mountain’s health strategy. In contrast to most companies, Iron Mountain offers a high-performance network plan through Aetna, which is called Aetna Premier Care Network Plus. It is a national network of high-quality and efficient providers, which includes ACOs. On average Aetna Premier Care Network Plus can save an Iron Mountain employee with a family on the plan $3,300 per year. With close to three-quarters of employees earning about $38,600 per year, their savings are proportionally significant under this plan. Prior to transitioning their plan to Aetna on January 1st, 2018, only 32 percent of employees had access to Iron Mountain’s high-performance network plan. That number skyrocketed to 76 percent in 2018 with Aetna Premier Care Network Plus. Such an advance illustrates both better offerings and better communications in the overall benefits package.
“Aetna is excited to partner with and provide industry-leading solutions to Iron Mountain to help them achieve healthy, happy, and productive ‘Mountaineers,’” says Bill Leahy, Aetna’s vice president, business development. “It takes a progressive benefits leader like Scott Kirschner to adopt emerging solutions that will accomplish that goal.”
The business imperative at Iron Mountain may be to reduce costs, improve productivity, and improve on recruitment and retention. But for employees lucky enough to work there, the result can be a healthier, happier, and even longer life—with lower healthcare costs.