Paul Terry's blog

The Department of Labor has issued new guidelines concerning the wellness provisions of the Affordable Care Act (ACA) that relate to the use of financial incentives, and the Office of Health Plan Standards and Compliance Assistance is seeking public comment. This document proposes “amendments to regulations, consistent with the Affordable Care Act, regarding nondiscriminatory wellness programs in group health coverage." These regulations increase rewards for wellness participation or outcomes from 20 to 30% or up to 50% related to reducing tobacco use. (Federal register)

In the past several years, StayWell Health Management has published several studies concerning the use of financial incentives in wellness programs, so my colleagues, Drs. David Anderson, David Gregg, and I, felt obliged to offer some reactions to the proposed new language. All public comments will be posted at: http://www.dol.gov/ebsa/. By way of summary, we commended the department for its painstakingly earnest attempt to placate the detractors of the original proposal who believe that incentives could too readily become a subterfuge for insurance underwriting. Still, we believe their attempt to divide incentives into participation based or health contingent models may well shed more heat than light on the matter.

Proposed regulations

The proposed regulations regarding a health-contingent wellness program include a provision that appears to say members must be offered the total reward even when they have no medical condition that would make it unreasonably difficult to meet the health standard or medically inadvisable to attempt to do so, based solely on meeting a participation-based alternative standard. StayWell believes this effectively negates any substantive programmatic difference between a participation-based and health-contingent wellness program. Participation in a wellness program by an individual is, in effect, a default option for anyone who is not inclined to make an effort at even making reasonable progress toward the standard, much less achieve it. In effect, the health-contingent wellness program is fundamentally a participation-based program with a provision that allows an employer to waive the participation requirement for individuals who already meet the health standard.    Read more »

John Muir, the famous naturalist, wrote: “When one tugs at a single thing in nature, he finds it attached to the rest of the world.”  It’s a concept that’s long overdue but now fully ensconced in the field of population health management.  Employee health management (EHM) practitioners, in particular, are coming to understand that the environments in which health promotion interventions occur are a primary determinant of the effectiveness of the interventions.  What’s more, many now fully acknowledge that the sustainability of healthy lifestyle improvements in diet, exercise, or tobacco use is fundamentally linked to our surroundings.  Indeed, in last week’s “HEROForum12”, a conference featuring EHM solutions, a third of the session titles included references to culture.  Moreover, no matter what the topic, the phrase “building a culture of health” was stated at nearly every session. Read more »

I have long held that leaders can’t fake authenticity. When you’re passionate about your vision, it is felt by others whether they support you or not. It’s a realization that has been easy to come by because I’ve had so many great mentors.

One of my favorites has been Stu Hanson, a pulmonologist, a health care executive, and a prime mover in Minnesota’s historic national leadership role in creating smoke-free workplaces. Stu would often say, “I’m trying to work my way out of a job.” Putting aside his recent retirement and the fat-chance odds behind his conviction even when he was mid-career, to know Stu is to understand that he wasn’t kidding.  Stu’s mantra was the ancient proverb: “When you are through changing, you are through.” Perhaps it is a philosophy born out of the Herculean-sized stubbornness needed to take on the intractability of an addicted smoker. Or maybe being wired to push for change helps you cope with the blowback and disappointments that come from working to change something as unyielding as a culture.

As a student of leadership as well as one interested in the intersections between health care business and public policy, I also can’t help but follow Toby Cosgrove, a cardiologist who became Cleveland Clinic’s CEO.  I have assumed that his equanimity about the controversy that surrounds his ban on hiring tobacco smokers is grounded in the righteousness that only a cardiovascular surgeon can feel at his core after having performed 22,000 operations, at least half of which were lifestyle-induced. What else explains his more recent foray into smoking bans at universities? In a speech to the Harvard Business School Club of Cleveland, Cosgrove said: “The fact that American universities are not smoke-free appalls me.” Though being right is a powerful buffer, it doesn’t change the likelihood that he’ll be disparaged. Read more »

Paul Terry, PhD, is Chief Executive Officer of StayWell Health Management.

As is always the case when I return from working abroad, it takes me longer, metaphorically speaking, to unpack my bags. I was ostensibly in Brazil to teach and consult about innovations in our population health management movement in America. But, as I expected, I was surely the greater beneficiary of teachings from leaders of the wellness movement in Sao Paulo, the business nexus for the world’s sixth largest economy.

Leaders of population health programs in Sao Paulo offer a self-assessment of being a decade or more behind the United States in the maturation of employee health benefits such as employee assistance programs (EAP), disease management, pharmacy benefits management (PBM), and wellness. I anticipated we would be discussing the “leapfrog” opportunities that come with later adoption of trends. For example, developing countries garnered advantage by skipping much of the costly infrastructure of cable by embracing  wireless communications.

So I came to Brazil thinking about what aspects of American health care innovation I would skip over if I had a chance to learn from the trials and errors of America’s health reforms. Read more »

I expect the next 10 years of policy debates, action, and inaction concerning how to curb our obesity epidemic to be an accelerated version of the last 30 years of public policy related to fighting tobacco.

This week’s HBO documentary, The Weight of the Nation, landed a flourish of solid blows against the wrong-headed notion that obesity is simply about lack of will power. The broadcast is based on the report “Accelerating Progress in Obesity Prevention: Solving the Weight of the Nation.” It’s the product of an extraordinary, even historic coming together of the Institute of Medicine, the Centers for Disease Control, and the National Institutes of Health. The report and the documentary make one point exceedingly clear: Obesity is a multifaceted problem that will require multifaceted solutions. Read more »

I love my colleagues in Information Technology. I also love greasy doughnuts. Why then, do I not love it when I.T. people bring in a big crate of greasy doughnuts to reward each other for their hard work? They only do this occasionally. Still, my latest way to chide them about it was to put a recent section of the Wall Street Journal right alongside their gloriously globby booty. The full-page feature, complete with pop-out quotes of long-suffering dieters feeling sabotaged at work, was titled: “Colleagues Who Can Make You Fat.” The article notes that fully 30 percent of dieters cited worksite colleagues as the culprits in foiling their dieting plans.

As everyone knows, annoying one’s colleagues in I.T. is something you do at your peril. In the military, you play nice with the barber and the cooks. In the private sector, you pander to I.T. lest your PC mysteriously crash. So let me reiterate: I adore my colleagues in I.T. One plays in a rock band and can reassemble his Rubik’s cube in world record time, another went to a Florida boot camp to shore up his baseball umpiring skills, another can sleuth out programmers’ bugs like she’s Agatha Christie, and yet another could win Dancing With the Stars except, well, he’s not a celebrity … yet! So they’re a brainy, fun-loving, interesting, accomplished lot who I love to death. Far be it for me to tell them what to do, except, for example, if their bad habits were expensed to the company. I’ve checked; their globby treats most assuredly are not.

So, this is an appeal to their problem-solving prowess. If A is my attraction to doughnuts and B is my belief in freedom, why doesn’t A + B result in being cool with bringing in doughnuts? With their training in algebra and Boolean logic, they surely have a better chance than I at solving for why the “commutativity” of the elements, that is, the order of the numbers, does not in this case affect the result.

But perhaps there’s more to this equation than A and B. Here are just a few properties to bring to the calculus:

• This isn’t just about the fact that we’re a wellness company. Even some of our most staunch fitness- nut colleagues (and, yes, some are from IT) were conflicted when we circulated an article about local schools cutting back on sugary treats in lunchrooms. “Schools as birthday- cake- free zones” describes how school districts nationwide are changing food policies to address obesity and food allergy trends.
•  I really do get that there is no end to the slippery slope of placing sanctions on unhealthy choices. The first of many national health conferences I’ve organized and hosted was called: “Private Lives ... Public Policies — Incentive Systems and Risk-Rated Health Insurance.” My first keynote speaker was Howard Leichter, author of “Free to Be Foolish,” whom I considered a brilliant spokesman against “outcomes based” incentive schemes. At the time, 1991, it was called “risk rating,” but the principle hasn’t changed: How do we fairly balance individual versus social responsibility for health? Leichter and I agree that the pendulum too often swings toward blaming the victim.
• To wit, if “Colleagues who make you fat” had been a policy appeal to making healthy choices the easy choices at work, and it had been published in the New York Times, conservative leaning colleagues could simply dismiss the article as yet another socialist missive intent on regulating commoners. But this was from the Wall Street Journal. It recently joined the Harvard Business Review’s piece on health and shareholder value and other decidedly free market and independence advocates who acknowledge the inexorable link between health practices and worker productivity and health care costs.
• And here’s perhaps the hardest variable to compute of all. Like most growing firms, we drive our I.T. team members incessantly for ever-greater output, which undoubtedly burdens them with more than their share of stress. What workplace policymaker can wield endless demands on one hand and reprove a simple pleasure like comfort food on the other?

So here’s the nub of this calculus problem I need help solving: If making healthy choices the easy choice is good, does that mean making unhealthy choices the easy choice is bad?

I’m going to go puzzle over this question with some sweet purple grapes.

Did I mention that I love my colleagues in I.T?

Paul E. Terry, PhD, is CEO of StayWell Health Management

By Paul Terry, Ph.D.

Serendipity landed me across the table from a couple of enormously brainy people the other day. We sat having drinks overlooking the hubbub of New York’s Grand Central station. One was a seasoned corporate attorney, the other a superbly incisive CEO. I mentioned how the younger crowd was in a hurry to get home from their marginally satisfying work worlds to engage in their vastly more challenging virtual worlds. I explained that I’m midway through a Yale on-line course in game theory, and how remarkable I was finding the overlaps between behavioral economics, social psychology, and game theory as each informs what we know about motivating people and supporting their successful health behavior changes.

In my experience, brainy people are defined partly by how much they know, but more often by how inquisitive they remain. True to form, this pair prodded me into sharing more about my enthusiasm for game theory, and how it relates to StayWell’s work in population health management. I explained how tenets of personal mastery are a vital part of what we consider when we develop health education software, and how increased use of financial incentives and biometric health screening has been trending strongly in population health programs, enabled by section 2705 of the Affordable Care Act. Behavioral economics theories underscore both the opportunities and threats affecting those of us designing ever-more-powerful ways of reinforcing progress toward better biometrics or sanctioning lack of same. (StayWell’s incentives position is something I’ve written about here previously.)

What game developers, health educators, and behavioral economists share is balancing the art and science of rewards for goal attainment (keeping it challenging but attainable) with freedom to choose your path to success (what Richard Thaler in his book Nudge termed “paternalistic libertarianism”) and feedback mechanisms that keep you coming back for more. What the gamers seem to be doing better than the others is binding these motivational principles to the power of social networks.

On this last point, Jane McGonigal, author  of Reality is Broken, makes a compelling case for harnessing the extraordinary power of gaming communities to improve the world. And it was on this, what became my final point, that I manifestly lost the interest of my Grand Central students. In her New York Times best-selling book on gaming, McGonigal chronicles countless examples of the tireless, albeit disturbingly compulsive, commitment that millions of gamers bring every day to building virtual worlds and competing therein for fame, fortune, and meaning in their lives. The very notion that gamers were inspired to dedicate untold unpaid hours to be “part of something big” but not of our familiar world was not only antithetical to my brainy buddies, but I could also tell they found it unsavory. I’m good at holding up my end of a conversation but, blessedly, I’m better at noticing when someone checks out on her end.

We changed the conversation to the prophylactic value of nature and the emerging realities behind nature deficit disorder. As parents, we all agreed that Last Child in the Woods (Richard Louv) was a must read. We enjoined the oft-held refrain of parents of my generation that kids need to discover the virtue of disorganized creative play, as it surely backdrops our own rampant success at building a peaceful and verdant world. The subtext of this abrupt conversation change was biting and clear: Time spent experiencing joy in virtual worlds is bad. Alternatively and comparatively, time spent in the “real world” is good.

Those of us with smart phones now reach for our hip, on average, 150 times per day. Were it not for the rapid retreat of my buddies from the premise that principles of gaming hold powerful promise for the future of health and health care, I might have shared more examples of how we are connecting this inexorable new habit to health improvement outcomes. This month’s issue of the The Nation’s Health includes an interesting article on the effectiveness of gaming in increasing physical activity. As one who is at an expert level as a Rockband drummer on many songs from my Beatles play list, and as a host of Dance Revolution parties using the Kinect body motion sensor, I can attest to the effects of gaming on my aerobic capacity.

Had we not changed the subject, knowing the commitment to community service of my Grand Central friends, I would have detailed the amazing story of the Sony Co., which mobilized players on its PlayStation 3 consoles to become the largest computing community ever to contribute to Stanford University’s “Folding@Home” in support of its protein folding mission. It’s a project where gamers run software that helps scientists better understand diseases like cancer and Alzheimer’s.

And with over 250,000 health apps and counting, the fun and, yes, meaningful work in communities online is just getting started.

Paul E. Terry, PhD, is CEO of StayWell Health Management.

Having just finished reading Walter Isaacson’s brilliant rendition of Steve Jobs’s life and career, I’ve considered whether there are health care marketplace lessons to be garnered from his central casting in the extraordinary tech wars for primacy over the past 25 years. I’d commend this biography to anyone who loves great writing and insightful analysis of the human condition, along with the foibles of growing a business. But first, here are a few reasons for and against reading Steve Jobs’s biography if you’re hesitant to take on a lengthy tome. If you’re drawn to business books that profile great leadership and exemplary business practices, Isaacson’s research will leave you cold and spent.

Jobs was a textbook narcissist and his vaunted “reality distortion field” will leave you puzzling over why anyone tolerated his oddities and crudeness. But if you are interested in how creative genius, serendipitous convergence of industrious minds, and shrewd, albeit fanatical, business decisions can shape the direction of an industry (and, yes, change the world), this is the tale not to miss. As for Isaacson’s clever writing, let me know if you laughed as hard as I did when you reach the part about Jobs’s vendor partner proudly printing T-shirts with an acronym not to be described in this more civilized blog post.

Now on to whether Jobs would appreciate the merits of regulations advancing Accountable Care Organizations (ACOs). I think not. Jobs had individual market instincts and would likely scoff at the idea that innovation can be promulgated by thousands of pages of what “the ACO shall provide.” Still, if the strongest case for ACOs rests with the idea that this time we intend to execute on a shared vision of inexorably integrated primary care, I think Jobs would want to learn more. Jobs had a career-long vision and constancy of purpose grounded in his belief that the best user experience comes from a closed system, and his conviction that controlling the quality of both hardware and software was vital to offering consumers what they needed. What’s more, he felt it was the only way for him to invent what consumers didn’t even know they wanted. Such was his tireless battle against Bill Gates, Google, and all other comers who believed open architecture would drive greater choice, better prices, and, in the end, more innovation for the consumer.

So far, ACOs are closed systems. To wit, the majority of the “pioneers” are simply those that already own the integrated medical records, call centers, and IT-abetted care coordination infrastructure needed to pursue the economic potential of an ACO delivery model. But I can just hear Jobs’s reaction: “It’s not the shared savings, stupid.” Actually, he’d have used much more colorful adjectives. Jobs defied business maxims assuming innovation and profit are a virtuous upward spiral. Indeed, he routinely eschewed profits and blew apart operational efforts to lower development costs in deference to his puritanical devotion to sweating every detail related to quality. If you told Jobs about VA Health Care as an example of how health information technology can reduce errors, improve quality, and reduce costs, he’d be fascinated. But if you then told him that most of health care is provided by small groups of medical providers and that very few of them believe they are equipped to accommodate ACO requirements, I think he’d react with conversation-ending expletives. Remember the famous Macintosh commercial proclaiming “1984 won’t be like 1984”? Ironically, as much as Jobs would likely favor the cottage industry innovators over the “big brother” version of an integrated platform, he and his wife, in effect, built their own ACO. That one of the richest men in the world was experiencing such uncoordinated care that his family decided to step in to assemble and coordinate their caregivers shows just how far we need to go before the integration tenets of the ACO movement can be realized.

Paul E. Terry, PhD, is CEO of StayWell Health Management

Paul Terry PhD
The Affordable Care Act codified the worksite wellness exemption to the federal medical underwriting provisions in the group health plan market. This means companies are allowed to use an “outcomes-based” incentive model that provides financial rewards for those who satisfy a prescribed health standard such as a BMI of less than 30 or who meet a “reasonable alternative standard” or obtain a waiver from their physician. What some see as “rewards” others view as penalties or surcharges and, given the absence of evidence to confirm the role of such incentives in actually improving population health, the new provisions have unleashed a debate about the ethics and putative effectiveness of the new provisions.

Many view the current and more common use of participation-based incentives as too easily exploited and insufficient to break intractable health habits. Others see the emerging trend toward use of outcomes-based incentives as draconian and a subterfuge for insurance cost shifting. I think the wisdom is in the middle and, with my colleague David Anderson, have argued that we need move beyond these opposing views by proposing an alternative "progress-based" incentive model that we believe can increase employee accountability and engagement while preserving fairness and equity in the use of incentives: “Finding common ground in the use of financial incentives” (http://www.ajhpcontents.org/doi/pdf/10.4278/ajhp.26.1.c2)

In contrast to the commentaries from the American Heart Association and the American Cancer Society in the above link that argue that incentives should be confined to participation only, we believe that a “progress-based” incentive strategy will provide a participant-centered, risk-adjusted and safer approach to achieving population health goals.

In a “progress-based” model, the attainment of a reasonable individually-tailored health goal, such as losing 10 percent of body weight, offers participants who fail to satisfy the health standard with an opportunity to earn incentives regardless of how far from the recommended health standard they begin their journey. Confining rewards to only those who hit the outcome target risks alienating those at highest risk who have the furthest to go and generate the highest costs to the organization. A “progress-based” approach, on the other hand, has the potential to engage everyone in setting achievable, measurable targets that yield health improvements.

What are your thoughts on the best use of financial incentives? The new provisions of the Affordable Care Act seem to signal a conviction that employees' accountability for their health should be bolstered. Has Congress inadvertently put employers in the role of insurance cost shifting?

Paul E. Terry, Ph.D., CEO, StayWell Health Management