Debunking The Bad Math Of Workplace 'Get Well Quick' Schemes

"Workplace wellness" is a big and burgeoning movement. But is it a bubble?

If you work in a company of any size, chances are you know the "wellness" drill. Your employer is getting killed by health care costs, and tries to bring them down by motivating workers to get healthier. The wellness program offers you incentives — as much as several hundred dollars a year — to fill out a questionnaire on your health risks, get medical tests, lose weight, quit smoking, lower your cholesterol.

What could be bad, right? You win, your company wins. The idea is so appealing that it's enshrined in the national health overhaul best known as Obamacare, and in the latest groundbreaking health reform moves in Massachusetts. And it has fast become the norm: Most companies that offer health insurance benefits now also offer some sort of wellness plan as well.

So when Al Lewis takes on the $6-billion wellness industry in his recent book, "Why Nobody Believes The Numbers," he'd better be packing some good ammo. And he is: Fifth-grade math. Well, sometimes fourth-grade.

Lewis — an expert in "care management" across populations and measuring efforts to improve it — argues that yes, wellness is a bubble, because much of the movement carries a fatal flaw: Its potential economic benefits have been outrageously oversold.

Many wellness program vendors promise companies that they can quickly and cheaply cut their workers' health costs — and back their claims with numbers that could not survive the most elementary scrutiny, he says. (Lewis titles Chapter 3, "Case Studies That Flunk Every Plausibility Test Known To Mankind.")

'The entire economic justification for wellness is made up.'

One example of many, his helpful analogy from the housing world: "If you insulate your house, you should save money overall, but you won't save money on insulation."

The health care equivalent is that you need to spend money to save money overall. If you get your workers to go to the doctor more and take more of the drugs they need, you may save money by avoiding hospital stays and ER visits. But — contrary to what some wellness experts claim — you're not going to see your spending on drugs and doctors go down, too, Lewis says. That would be like saving money on insulation.

"What are these people thinking?" he asks. (On his Website here, he bestows "Intelligent Design Awards" to some of the more egregious overpromisers for "setting back the evolution of the wellness field.") In essence, he argues, virtually all the data on the wellness Return on Investment — "The entire economic justification for wellness, is made up."

Fightin' words, and Lewis acknowledges that his camp of wellness-data skeptics makes up only perhaps 2 or 3 percent of the field. But Forbes contributor David Shaywitz praises him as a purveyor of "an inconvenient truth." And "the good news," Lewis says, "is that arithmetic is not a popularity contest."

Lewis is not arguing that all wellness programs are pointless. Good ones can work, he says, slowly and modestly. But without accurate data,  wellness programs cannot be assessed, he says, and much of the money spent on them could thus turn out to be wasted. Including quite a few taxpayer dollars.

Our recent conversation, lightly edited:

So you're challenging the wellness industry, but do you accept its underlying premise, that chronic disease is our biggest health problem and that lifestyle issues are the biggest factor in chronic disease? 

The brief answer is yes. But the much longer answers are:

It does not logically follow that by paying people, you can get them to change their lifestyles and therefore fix the problem. The average German worker has twice the output of the average Greek worker, but nobody has suggested that Greece can solve its economic problems by giving classes in how to behave like Germans.

If you actually look at the spending on chronic disease, it's not as easy as just 'We have to do prevention,' because in fact the large majority of money in chronic disease is already being spent on some level of prevention. Asthma is the clearest example: A health plan already spends 10 or more times as much on asthma medications and other asthma prevention as it spends on emergency room visits, and it's the same structure across the board.

Take the heart attack rate, which is 1 in 500 in the working-age population. If you look at what is spent on cardiac drugs and procedures and tests to prevent heart attacks, it's already vastly more than is spent on the events themselves.

In fact, per 1,000 people in a commercial health plan, if you look at diabetes and its complications, heart attacks, angina, and a few other things, the number of admissions to the hospital per 1,000 people over the course of the year is five or six, and over the course of the year they spend about $200 per person on these admissions, out of a total of $4-5,000. So it's "Let's go after this because everybody says we should," as opposed to "Let's do the arithmetic."

And the general picture is that you have companies that face skyrocketing health costs, and they're desperate, and the wellness experts say, 'We can help you cut that'? 

Yes, and it’s a complete fallacy. if you had a drug for the common cold, you’d look at the number of people who had the common cold and figure out how many colds your drug would avoid.

For wellness, they don’t look at wellness-sensitive events like heart attacks and say, 'Did the rate of these go down?' They just say, 'Your total costs went down,' and take credit.

If you ask a wellness vendor, 'Show me your list of wellness-sensitive events,' they don't even have one. They don't know what they're trying to avoid. I'm currently putting together a list of wellness-sensitive events.

For many employers, wellness is now the single biggest discretionary Human-Resources-type spending they do. The average incentive is $460, and that doesn't even  begin to cover the cost of the program, which could be another couple of hundred dollars per person.

'You're trying to create a culture of health but you end up creating a culture of deceit.'

How does it tend to go? Say I'm a company and you're doing a typical wellness program for me. 

I offer you a 'health risk assesmment' in which people go online and fill out a bunch of answers like how much they drink — and by the way, they're not going to tell you how much they really drink, they’re going to lie. You're trying to create a culture of health but you end up creating a culture of deceit.

As the employee, you know that if you fill out the risk assessment about half of that 460 bucks will go to you right away. So you fill it out and you get a report, and they tell you what all your risks are, and then they tell you that you need coaching and they try to set up phone calls for you.

If you smoke, the employer will offer you a couple of hundred dollars plus a nicotine patch. So there are smokers who are spending probably $2500 a year smoking, and they're supposed to stop because you're giving them a couple of hundred bucks and a patch.

Next, they have biometric screens where you go in and get blood drawn and some other kinds of screening, and these things are supposed to tell you what your risks are.

I'll also offer you some kind of weight loss thing, like a "Biggest Loser" competition, maybe give you pedometers. You can’t argue with a pedometer. It doesn't save any money but it's nice to know how far you walk in the course of a day.

So basically, it's usually a Health Risk Assessment plus coaching plus nicotine patch plus weight loss. One vendor claims that with just a Health Risk Assessment, they’ll get you an 11.4 times Return On Investment. Some people claim savings of more than 100%.  I've probably seen 30 Return on Investment numbers, and I haven't seen one that wasn't obviously made up.

Is this really the wellness industry norm, or just a few bad apples?

There are two ways you can tell a wellness vendor is a good guy. One is that they don't claim a Return On Investment and number two is that when you go to their Website they don't have a 'brokers' tab that says, 'We work with you,' which means 'We pay you to push our product.' They have to do it, but the ones who brag about it are the bad guys, which is most of them.

Essentially, this is the entire industry with few exceptions, because in order to compete in this industry, you have to be able to show the highest Return on Investment the fastest, because that's what the customer is looking for. Whether it's valid or not is of no concern.

But what about all the reputable studies that say wellness programs save money? Including a seminal piece in Health Affairs that found that it returns $3 for every dollar spent? What about the national fame of the Safeway wellness plan that influenced the Obamacare wellness piece?

Yes, Health Affairs legitimized it three years ago in an article by Harvard professors called "Workplace Wellness Programs Can Generate Savings." I would say, ask them how they feel today. My feeling is that the bigger these bubbles get, the faster they burst, and the same media that has been fawning all over it is going to be piling on when it bursts.

On Safeway, let’s start with the premise: It turns out Safeway did not even start their wellness program until after they already had three years of flat costs, because they had put in a high deductible. And when they started the wellness program, the trend went way up. Also, the wellness plan only applied to the headquarters staff, so it is a complete myth that Safeway saved money to start with. Check out the Washington Post story on this.

'I suggest that you take 1 percent of the money you're throwing away on your wellness program and use it to clean the restrooms more often.'

I used to not only drink the Koolaid, I used to mix it up and offer it to everybody. I was the worst. If you go back 10 years and you look for people who were pushing disease management, which is essentially wellness for sick people, I was the number one drug pusher. But the difference is, when I saw the data and the data just did not fit, I changed. My job description now is, I'm the guy — and there are a couple of people like me who I work with — we tell the truth.

So if wellness isn't the way to bring down health costs, what is? 

It's life by healing a thousand cuts. It's 'Let's do a whole bunch of little things,' and if you want to make a really big impact, you have to shift a bunch of costs back to consumers. There's not much else to be done. If there were something easy to do, people would have done it. By doing all best practices, you could cut between 2 and 5% of costs.

So as an employer, what should I do for my employees?

If you ask a general what the most important thing in soldiers is, they're not going to say wellness, they're going to say morale, of which health is a part. The big picture is: What is going to excite your employees about coming to work and make them productive? I suggest that you take 1 percent of the money you're throwing away on your wellness program and use it to clean the restrooms more often. So now you have 99 percent left over to create a true wellness culture.

Massachusetts, with its latest health reform aimed at containing costs, is diving head-first into wellness-type stuff. What's your reaction?

I would ask the people who put together this legislation, 'What is the rate of preventable events, avoidable through this kind of activity, right now?' And if they can't tell you, the legislation is based on a phony premise.

The other thing all these wellness trends have in common is that they're all pointing the finger at the patient. 'If only we had better patients, we'd have a great practice.' Well, Massachusetts has some of the healthiest people around...

Readers, reactions? What results have you seen from your workplace wellness program? Here's a recent Health Affairs blog post co-authored by Lewis and an interesting counter-point from a colleague of Lewis's: On Workplace Wellness, Don't Throw The Baby Out With the Bathwater.