What is Population Health? Why is it Important for Employers?

A whopping 90% of the U.S.’s $4.1 trillion annual healthcare costs are a result of chronic diseases.

This figure is staggering — and the effects are impacting employers every day.

You want your workforce to be as healthy as possible for many reasons, but most important because your people matter. Putting the right holistic healthcare measures in place can also lead to increased productivity, reduced absenteeism and lower healthcare costs overall.

That’s why population health management is a vital part of a business’ healthcare initiative. But what exactly is it and what does it mean for your business and your employees?

Let’s start with the basics.

What is population health management?

According to The National Academies of Sciences, Engineering, and Medicine, population health focuses on “the health outcomes of a group of individuals, including the distribution of such outcomes within the group.”

In essence, population health management uses data to make smart, informed decisions to create better outcomes within a defined population (such as your business).

The main goal is to use employee data to take action to improve employees’ overall health and well-being, from managing health conditions to preventing them in the first place.


Data analysis is everything

Data plays a key role in population health management. An effective TPA (third party administrator) can use tools to gain data-driven insights into a workforce’s health in order to analyze trends and inform decisions — leading to better outcomes.

Understanding the needs of your population means analyzing data from electronic health records, pharmacies, labs and insurance claims (to name just a few sources).

These actions include:

  • Identifying health risks. Data can be used to identify individual employee health risks, such as chronic disease or health behaviors.
  • Predictive analytics. Advanced analytics tools can predict who might be at risk of developing chronic conditions so you can take preventive measures.
  • Outcome measurement. Data is crucial for measuring the outcomes of healthcare interventions. Without it, you will have difficulty measuring the effectiveness of any actions.

At MagnaCare, we examine all data to pinpoint at-risk individuals and forecast their annual health expenses. These insights let us target opportunities for improving care and lowering costs.


What are the core elements of a PHM program?

Health isn’t linear; it’s holistic. A PHM program needs to look at the full picture to have a chance of being effective.

The four core elements of a successful and holistic program are:

  • Powerful preventive services

Systematic on-time screenings and immunizations can prevent 85% of chronic disease.

Preventive care focuses on maintaining health and averting potential diseases before they manifest. It all comes down to proactivity: looking at an individual’s risk factors and taking action to identify potential health problems early.

Education is another significant element of preventive care. It’s important to give employees the opportunity to learn about healthier lifestyle choices that can combat conditions such as obesity, heart disease and diabetes.

As a result, preventive services can contribute to a healthier work environment, greater job satisfaction and, ultimately, improved business performance.

In fact, giving employees access to preventive care creates real, immediate cost savings for employers. A recent RAND study found that for an organization with 10,000 employees, a good preventive care program could save the company between $5 and $12 million each year.


  • Wellness programs to foster autonomy

As healthcare costs continue to skyrocket, employers can save an average of $1 to $3 for every dollar spent on an employee wellness program.

So it’s well worth the investment, wouldn’t you agree? But getting the right program in place is essential for success.

A wellness program is designed to promote healthier habits and lifestyles within a workforce. It should cover exercise, nutrition, stress management, substance abuse and overall mental health awareness.

The goal should be to empower individuals to take control of their well-being, fostering an ongoing culture of health-consciousness.

A great example can be seen in business applications company SAP. They implemented a well-being initiative in 2014 that has seen their Business Health Culture Index rise from 69% in 2013 to 78% in 2018. The financial reality is that every 1% change in the Index reflects a $90 to $100 million (EU) impact on their operating profit.


  • Effective chronic disease management

Forty percent of Americans already have a chronic disease that requires continuous care and monitoring. This type of management calls for a coordinated approach, encompassing medical treatments, lifestyle modifications and education around their condition.

Chronic disease management can improve quality of life, allowing affected employees to continue with their careers. It can also slow disease progression and prevent further complications from arising.


  • Patient engagement strategies

Engaged patients are three times less likely to have unmet medical needs, and twice as likely to seek care on time, as unengaged patients.

Most patients don’t want other people to make decisions about their health. Instead they want to learn more about their health from trusted sources and make collaborative decisions.

Employers can offer benefits such as telemedicine and dedicated case management to enhance the experience and engage patients in their care.

All these four elements work together to promote healthier lifestyles, manage chronic conditions, reduce healthcare utilization and costs, and improve patient satisfaction and health outcomes.


Final thoughts

Population health management is vital for businesses. A healthy workforce is essential for sustained productivity and efficiency, which is going to make or break your long-term success as an employer.

Employees in good health are less likely to take sick leave, cutting down on overall absenteeism.

And, as a final but important point, showing your employees that you value their well-being is only going to help you retain them. Take steps to keep your valuable employees happy, healthy and showing up every day.

Want to find out how MagnaCare can help with population health management? Take a look and get in touch — we’re ready to talk it over.

MagnaCare Blogs

What to Expect from the Minimum Essential Coverage (MEC) Application Process

Finding a healthcare plan for your company isn’t…

Read Post

Self-Funded FAQ

The benefits you need. The cost savings you…

Read Post

Information on Change Healthcare Cybersecurity Incident

As widely reported in the media, Change Healthcare…

Read Post

One Strong Voice

Explore Laborstrong.live, the premier online platform for Union...

Read Post