Posting in Finance
The key to Virgin Healthmiles is a business model for employers, a sliding scale of discounts for participants based on measured results
We do it in car insurance. If your record is loaded with accidents and tickets you pay more. Many carriers offer "good driver" discounts.
Why can't we do that with health insurance? Now we can, and one way to make that work is with an application created by a unit of Richard Branson's Virgin Group.
Called Virgin Healthmiles, the system combines tamper-proof exercise measurement devices, regular screenings for blood sugar, body mass index (BMI) and cholesterol, and an online service that delivers results to employers who commit to the program. (Image from Virgin Healthmiles.)
The initial cost is super-cheap, said Virgin Healthmiles CEO Sean Forbes (no relation to the publisher). The software service costs as little as $27 per participating employee, per year. The client devices can be replaced for just $25 each.
The key is the business model put in place by employers, a sliding scale of discounts for participants, based on measured results, said Forbes.
This delivers serious savings.
For employees, it costs $12,500 to insure the average family. Discounts can now go as high as 30% under the health reform law, although the old law's 25% limit was also serious cash.
For employers, some participating companies have seen cost increases of zero after seeing 19% rises the previous year.
Just as important, the program can change a corporate culture. "It changes the kind of people that join or stay at a company." No surprise, since increased costs are borne entirely by those not participating in the program.
"Giving everyone health insurance doesn't make the population healthier," Forbes continued. "I may make a poor decision because someone else is making the right decision. We have to link decisions to outcomes.
"Wellness has failed because it wasn't measured or was self-entered."
It's also important to note the social dynamics at work, Forbes noted. His company did a survey of employers and employees, asking under what circumstances they would participate in such a program. The overwhelming response, 80%, was they would if others did.
There is also a strong self-reinforcing dynamic among participants. When the program first began, for instance, some people tried to cheat the machines, by tapping their feet during meetings with the pedometer on the foot. Viral videos and nastygrams on social messaging sites helped put a stop to it.
"We renew over 90%" of companies that sign-up, said Forbes. "The reason they keep paying is we can show a linear correlation between group improvements in things like blood pressure and BMI, measured monthly, which lets us report to employers linear correlations with claims on chronic diseases."
Forbes said he was an engineer before going into finance. He believes in data. And data can make believers out of both employers and employees. It's real health reform, completely private, taking advantage of incentives that existed before the present health reform law was enacted.
"There's a growing population of employers who need to manage wellness like you manage a supply chain or a sales pipeline." As more employers self-insure their risks, expect more to take advantage of programs like this.
Jun 3, 2010
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like Dana's response in #9. Supergal I wouldn't want to keep someone who can't help it from being covered but a good chunk of us as people can help it and choose not to b/c it's just easier to blame our health issues (not related to genetic defect) on someone else OH and expect someone else to fix them. Time to take control of our own health and life, and if someone wants to give me an incentive for something I'm smart enough to do on my own, AWESOME it's like extra credit. I am however not for the BMI criteria, unless there's good other measurement info with it (I am a fit individual and have healthy body fat but due to the standard table I am told I'm close to obese because I'm muscular)...just saying keep tweakin that one :)
So you want those who follow doctor's orders paying for the care of those who can't? Interesting bumper sticker. We can deal with excuses (like genetics) for disease, but the way to lower insurance costs is to increase wellness, and that means treating those who are well as well, rather than as just not-yet-sick.
Basically, this is just one more way to marginalize those that aren't perfectly healthy. Have diabetes or taking drugs that cause a weight gain? Suddenly you're on a steady downhill slide: Everything costs more because of the weight gain caused by the drugs - but cutting back on your drugs to help the weight means that you're dinged for not following Dr's orders and now you have an 'uncontrolled condition' which means everything will cost you more. Welcome to bankruptcy and no health care. In a nutshell, this is the modern equivalent of 'survival of the fittest'. Only the fittest can afford to survive.
Ok while someone is young and can have physical and mental fitness monitored to their advantage,but as the body ages,will employers/employees pay a higher premium?Will long term employees therefor be discriminated against as they become an insurance burden on their company.I am all for "wellness" as a policy but why not start with education and continue throughout life,not wait until we are of employable age as the groundwork has already been laid for our future health and no amount of insurance will keep us on the straight and narrow road.
... Capitalism and Communism/Socialism: It puts doctors on the dole, rewards stagnation, and is only for those who can afford it. Without insurance, we'd have a situation where the medical industry (and we must all always remember that it is an industry), would suffer a severe funding shortage, which has always been shown to spark innovation, which has always resulted in lower prices, which has always boosted the general economy. Imagine being able to drive over to your local MRI clinic for an annual, walk-in, $50 scan. Imagine $200 outpatient RK. Imagine being able to diagnose yourself using, oh, it'll probably be google's next adventure... you.google.com or google.doc or google vein-view or something. For free. All you'd have to buy is a $150, grab-n-go tool-kit from Walgreen's with USB thermometer, BP cuff, stethoscope, etc. to tie into google, and you'll be able to monitor your own health 24x7 (ideal for those publicly funded ER abusers). Think that's so unattainable? Look down at your PC. Compare it to what you were using 10 or even 20 years ago. Your phone has more power than all the computers combined that put Armstrong on the moon. Now, what did you pay for your computers over the years? But, then again, insurance firms were never able to get a foothold in the PC market. Not that they didn't try. They did. Remember the 100% replacement plans you could buy? Even if you stupidly took your laptop to Disneyland, and dropped it in the Amazon, you got a new laptop. One insurer even briefly offered an obsolescence guarantee. If your machine was inadequate for the latest software upgrade, or employer mandatory program, you got a new machine. Then there were the financing plans... Can you imagine a used PC industry like the used car industry? Kelly blue book for PCs? Fortunately few people got reeled in by these plans, resigned themselves to having to pay cash to buy the best they could afford every 2-3 years, or whenever they broke their old one, and this pushed prices down, and innovation along to the point where we now have $500 laptops that shame the $2000 laptops of a decade ago. And YES, the two CAN be compared. I just did it.
That's fine for those who can control those health issues but some people are genetically afflicted and can help their problems. As an example, i know someone who has a high cholesterol level. this person has always eaten a healthy diet, and exercises regularly, yet even with medication on top of this his levels are high, so he gets penalized too?? this system will only penalize those who need it most and can afford it least. Way to go............
This is a market-oriented solution that would have existed with or without the health reform law. It has nothing to do with politics.
You guys should stop complaining cuz one the health care we have now isnt as good as it was supposed to be. also the law has just been signed give it a try u guys are too hard on democrats they went to college and we voted for most of these people.so if u want to say u have the right to choose tell that to ur congress men or state official. as for obama people are just trying to make it look like america made a mistake he has done things to help us and we had a full 8 years of a terrible president and i will be so as happy as ever when a obama fixes bush's mistakes. You can find full medical coverage at the lowest price from http://bit.ly/cmg7mK obama has to put up with the wo0rld judging his every move and trying to fix the mess we are in we are lucky anyone wants to be our president. STOP COMPLAINING AND GIVE HIM A BREAK. i wanna see one of yall do what he sas done. some people are just so ignorant.