EAPs Increasingly Seen As Effective Tool in Managing Health Care Costs, Enhancing Employee Productivity
by Sean Fogarty, senior vice president, CuraLinc Healthcare
According to the 2009 Watson Wyatt Staying[at]Work Report, nearly half of employers reported an increase in their workers’ use of their employee assistance programs (EAPs).
“Given the increasing breadth and depth of services provided by EAPs, it’s not surprising that more employees are tapping into them for assistance with a myriad of issues,” said Sean Fogarty, senior vice president of CuraLinc Healthcare. “Not only do I expect usage to continue to grow, but as we head into 2010, I believe employers will look to integrate their EAP with other components of their health management strategy. When positioned correctly, an EAP can act as an effective vehicle for managing health care costs and enhancing employee productivity.”
Fogarty predicts the following five trends will emerge in the coming year:
Trend #1: EAPs with an MH/SA (Mental Health and Substance Abuse) Gatekeeper component will be used to combat rising health care costs stemming from the Mental Health Parity and Addiction Equity Act (MHPAEA) of 2008.
The MHPAEA prohibits group health or self-insured plans covering more than 50 employees from imposing caps or limitations on mental health treatment or substance use benefits that are not also applied to medical and surgical benefits. Because of this, many employers will be forced to increase the mental health and substance abuse coverage in their existing benefit plan(s) in order to comply. As such, employer groups, particularly those that are self-insured, are concerned about the resulting increase in their health care spend.
No benefit is better prepared to offset the financial impact of the parity legislation than an Employee Assistance Program (EAP) with an MH/SA Gatekeeper component. Cases that are appropriate for the EAP are redirected into the Employee Assistance Program at the point of entry, while members with acute mental health or substance abuse needs are guided to the appropriate level of care within the benefit plan – thereby optimizing patient care and preventing significant health care costs increases.
Trend #2: To combat the rising costs of psychotropic medications, EAPs will increasingly be integrated into an employer’s pharmacy benefit.
In 2007, U.S. adults spent more money on antidepressants and other psychotropic medications than any other drug category. Considering that drug costs continue to rise even faster than overall medical costs, employers need to find new and effective ways to manage them.
As general practitioners (GPs) have become the first line of intervention for most patients with anxiety and depression, it is not surprising that five-in-six users of psychotropic medications are under the care of a GP (Medco, 2008). Unfortunately, the majority of GPs are not adequately trained to practice behavioral health, many having no formal training beyond the material marketed with the medication. Furthermore, most are not qualified to recognize the dependency-related issues associated with the use of these types of medications. These problems lead to higher utilization of emergency room and doctor’s visits, which ultimately drive up health care premiums and disability costs, and impede productivity via increased absenteeism and “presenteeism”.
An EAP-based pharmacy intervention program is uniquely qualified to handle the aforementioned problems. If the course of action set by the doctor is appropriate for the employee’s issue, the EAP clinician may suggest short-term counseling within the employee assistance program as a complement to the medication, or assist the member in finding a psychiatrist within the benefit plan who can more precisely treat the condition to reduce recidivism and ensure treatment compliance. If the EAP clinician feels that the course of action is not appropriate, the clinician will work with the member and the physician to develop a treatment plan that is consistent with the member’s condition.
Trend #3: EAPs will play a more active role in working with employees who file a disability claim.
The American Psychiatric Association (2007) estimates that 20%-40% of all disability claims have a co-morbid psychiatric diagnosis that contributes directly to the disability and increases the length of time the employee misses work. However, when an employee goes on disability leave, the mental or behavioral health component is often ignored. By addressing these behavioral issues, the EAP has a direct impact on the duration of the claim, the incidence of repeat claims, the frequency of short-term claims becoming long-term claims, and the psychosocial condition of the member.
According to The Hartford (“Healthier, More Productive Employees” 2008), workers who accessed their EAP while on short-term disability (STD) leave returned to work twice as often at the conclusion of an STD claim than employees who did not have an EAP available to them. The study also found that STD claim duration was 24% lower, after EAP interventions, for members with cancer, musculoskeletal, and psychiatric STD claims.
Trend #4: Employers will require more connectivity between their EAP and the other components of their population health management strategy.
Despite negative overall inflation, businesses are projected to pay 6.5% more on average for health care insurance in 2010 than they did in 2009, according to Hewitt Associates Inc. Most experts believe that 50%-75% of America’s health care costs stem from problems caused by lifestyle choices – decisions that put individuals at risk for a myriad of chronic conditions and diseases, such as diabetes, heart disease, stroke, cancers, kidney disease, lung conditions, and back, knee and hip problems, to name a few.
While employers are constantly refining their population health management strategy to address these behaviors, the one component that focuses most on behavior change (the EAP) has been historically left out of the conversation. As Helen Darling, President of the Washington Business Group on Health and Director of the Institute on Health Care Costs and Solutions writes, “As we seek new ways to improve outcomes, increase productivity, and enhance the quality of life from our enormous investment in health care, I believe employee assistance programs and services will be a the front of the line of effective solutions to the health care cost crisis. EAPs play a major role in reducing health care expenses and could provide even more benefits if their services were better known and understood.”
By adopting an EAP-driven population health management initiative, an organization will achieve lower health care costs, disability expenses, and worker’s compensation costs, as well as the indirect benefits of decreased absenteeism, enhanced motivation, and increased productivity. This is achieved because:
- When used as a performance management tool, an EAP has the ability to directly impact employee behavior by addressing workplace issues, such as conflict, productivity and absenteeism.
- Wellness is a behavioral condition, not a physical one. It’s an active process that begins with a conscious decision to make positive choices in creating and maintaining a healthy lifestyle. As such, population health management strategy cannot just focus on the employees that cost their organization money today. It must have a proactive approach to focus on risk factors and drive lifestyle modification of all employees before they become chronically unhealthy.
Trend #5: Employers will be proactive in working to overcome the stigma surrounding an EAP program.
In some organizations, where an employee assistance program has not been effectively marketed to employees, the benefit has a negative stigma and is often viewed as little more than a referral destination for employees with performance issues. In order to position the EAP most effectively within the organization, that stigma must be overcome through communication and education.
More than ever, employers are realizing that marketing the full scope of EAP benefits – from the traditional counseling and management consultation resources to the nontraditional services such as financial, legal, and work/life assistance – and promoting the preventive nature of the program reduces the stigma associated with the EAP. As employees begin to understand that the EAP is a confidential resource to help them address challenges in their lives before their work performance is impacted, awareness and acceptance will increase, and utilization rates will rise accordingly.
Sean Fogarty is a senior vice president at CuraLinc Healthcare (www.curalinc.com). Based in suburban Chicago, CuraLinc is a national provider of employee assistance programs and corporate wellness programs. For additional insights, Fogarty can be reached directly at sfogarty[at]curalinc.com; 224-534-2901.