OEBB Bails on Wellness Program that Didn’t Show Results
The Oregon Educators Benefit Board spent $10.5 million on a wellness program its advisors now say didn’t show results in improving the health of its members, and OEBB had no way of knowing if it saved money on medical costs.
The wellness program, Healthy Futures, was canceled this month amid rising expenses for OEBB, as part of an effort to keep the health exchange for teachers below the cost growth cap set by the Legislature in 2013. Healthy Futures had first been adopted for the 2014-2015 school year.
“It provided a reward without doing anything besides completing a risk assessment,” said Geoff Brown, the OEBB chairman and a former actuarial consultant with Towers Watson. “We want to get something for the money we’re spending.”
The total annual cost of OEBB’s health plans is more than $600 million and Healthy Futures represented about 0.54 percent of that total, or $3.8 million for the 2017-2018 school year.
Healthy Futures offered $100 discounts on deductibles and copayments to OEBB members who completed the online assessment. But OEBB had no way of tracking whether this led to healthier lifestyles, let alone whether that led to fewer medical expenses.
Brown said federal privacy laws that have been clarified over the past few years prohibited OEBB from verifying whether employees were leading healthier lifestyles. He said the benefits board also lost the ability to require spouses and dependents to participate in the program, weakening its effectiveness. “The objectives of the program were compromised,” he said.
Interestingly, one iteration of the failed Republican health bill debated in Congress last year would have reversed privacy regulations and made it easier for employers to collect health and genetic data about employees and their families for purposes of saving on health insurance.
The late Sen. Alan Bates, D-Medford, who was also a physician, was a leading critic of the wellness incentive plans administered by OEBB and the Public Employees Benefit Board, particularly the tobacco cessation program, which gave discounts to people if they claimed to have quit smoking in the past year, without verifying if this were true. The health plans had then touted member smoking rates far below the state average.
Brown said the decision to bail out of wellness programs was not limited to OEBB. “Corporate entities are trending out of wellness incentive programs because they are not offering the promise they thought,” he said.
Two representatives of the state’s largest teachers’ union, Oregon Education Association lobbyist Jared Mason-Gere and spokeswoman Jenny Smith, both declined to comment on the Healthy Futures program.
As far back as 2013, UCLA health economist Jill Horwitz argued in the journal Health Affairs that wellness programs are often structured to shift costs from healthier, wealthier people onto poorer employees with higher health risks, without saving money overall.
Both PEBB and OEBB are now scrutinizing their wellness programs. Gov. Kate Brown directed PEBB to hire a wellness manager and Sen. Betsy Johnson, D-Scappoose, an ex-officio member of the PEBB board, has repeatedly asked PEBB to organize and coordinate its various efforts.
Geoff Brown said that a special OEBB workgroup was analyzing its wellness offerings one at a time, and it was this committee that recommended canceling the Healthy Futures program. He said earlier the workgroup had demanded changes to its Weight Watchers program, requiring the obesity program to provide more detailed reporting and better outreach to OEBB members telling them it’s available through their insurance.
Canceling Healthy Futures helped OEBB save $3.8 million for the next school year, but other changes were also needed to limit rising medical costs, including sizable increases in copayments for complex dental procedures and a closed drug formulary, which will make it more difficult to access high-cost medications.
Revenues for PEBB and OEBB are held at 3.4 percent growth a year, even as costs rise, forcing the boards to get creative about improving the coordination of care. Private employer medical inflation is nearly double that growth cap, and the boards have been increasingly forced to find ways to shave benefits and trying not to drastically diminish the quality of the insurance or shift costs too heavily onto employees.
Reach Chris Gray at [email protected]