Author: Patty Kujawa

Two major players in health care have joined forces to create new, practical approaches employers could use to improve the quality of health care for minority employees.

    Earlier this year, the National Business Group on Health formed a partnership with the federal Department of Health and Human Services’ Office of Minority Health to develop strategies aimed at addressing racial and ethnic health disparities.

    The Racial/Ethnic Health Disparities Board and its five subcommittees, comprising employers, scholars, consultants, providers and other health care experts, are spending the next two years and $300,000 building the case that improving the quality of health care for minority employees will have positive results for everyone.

    “I hope we begin to have thousands of people’s lives improved through this,” says National Business Group on Health president Helen Darling, adding that the board is trying to show that narrowing or eliminating gaps in care for minority groups will end up saving lives and money in the long run.

    The subcommittees are examining how to effectively collect data, refine communication, upgrade the National Business Group on Health’s current business case in addressing disparities in health care, and encourage employers to be more specific in what they require from health providers.

    The board will also try to answer medical privacy questions and other complications companies may face in addressing minority health care gaps. The subcommittees’ recommendations will help develop a more sophisticated tool kit than the National Business Group on Health currently has, so more employers can start addressing the issue.

    “We need to show what success will look like,” Darling says.

    The premise for the board’s work has already been established through a number a studies over the last few years. The studies show that minority groups—regardless of income, insurance status or community of residence—aren’t as healthy as their white counterparts, and have higher sickness and death rates. Studies also have shown that certain minority groups, including African Americans and American Indians, have higher risks for certain illnesses, including diabetes and high blood pressure.

    Meanwhile, every employer knows health care is expensive, and costs are only rising. Last year, premiums for employer-sponsored health insurance rose 6.1 percent, faster than workers’ wages or the overall inflation rate, a Kaiser Family Foundation report showed.

    And while it’s also well known that preventive care and wellness programs are smart ways to manage health care costs, several studies have shown low participation rates among minority and ethnic groups. According to a March report on racial and ethnic health disparities by the Commonwealth Fund, a third of Hispanic families with incomes of $37,700 or more are uninsured—twice the rate of white families. According to the report, the disparity in coverage for Hispanics can be attributed to several factors, including that they are much more likely to be employed at low-wage jobs and at small firms that are the least likely to offer benefits.

    The problems are well documented, but solutions are mostly anecdotal. For the last two years, the National Committee for Quality Assurance, which also is part of the Racial/Ethnic Health Disparities Board, has publicly recognized companies that have created inventive strategies, including reducing or eliminating language, cultural and other barriers that can block the delivery of quality care to minority and ethnic groups.

    “Part of our goal here is to build the evidence base of what works” and to develop standards, says Jessica Briefer French, project director for the National Committee for Quality Assurance’s Multicultural Health Care Awards.

    It is difficult to establish ways to improve participation levels and, in turn, the level of health care for these employees, experts say. Employers and providers want to do the right thing for everyone, and legally can’t target one group, or give a specific group a benefit that isn’t available to everyone.

    “You can’t target one group at the exclusion of another,” says Greg Keating, an attorney with firm Littler Mendelson and co-chairman of its health care practice group in Boston. “Companies need to be careful in how they respond.”

    Darling and others agree. The first obstacle to increasing minority participation in health plans is gathering demographic data. Federal law—and laws in most states—allows health care providers to collect information on patients’ race and ethnicity. Getting employees to volunteer the information through enrollment forms, health risk assessments and other Web-based systems is one way to get it.

    Last year, Verizon Communications Inc. created an electronic personal health records tool, where employees enter and access their personal health information. Verizon combines this data with other resources to give employees information on when their care may be less than what is considered the medical standard. For example, employees over the age of 50 whose medical histories show no record of colorectal screenings will automatically receive preventive care alerts recommending that they schedule one.

    “We just want [employees] to know what tools and programs are available,” says Audrietta Izlar, Verizon’s manager of corporate human resources and chairwoman of the disparities study board. “We are trying to move people to a call to action.”

    Benefit management companies also are developing sophisticated technology to cull useful data. HighRoads Inc., based in Woburn, Massachusetts, recently unveiled a new benchmarking tool that allows employers to compare and create competitive benefits strategies. This program, called the Lab, can adapt to ever-shifting needs and trends, says Lori Dustin, HighRoads’ chief marketing officer. While it doesn’t currently assess demographic data, Dustin said the Lab could be adjusted to suit clients’ requirements.

    “We can capture anything we want going forward,” Dustin says, adding that clients have already asked to assess demographic data. “I definitely see this as a trend.”

    Employers can also use existing affinity or employee resource groups to gather data and deliver information, says Andrés Tapia, chief diversity officer for Hewitt Associates in Lincolnshire, Illinois. Many companies that make a commitment to diversity give support to these employee-run groups for many minorities, including Hispanic, Native American and Asian Pacific groups.

    At Verizon, some of these groups have existed for more than 20 years, and were a natural way for the company to distribute health education material and to highlight certain established risks for various groups, Izlar says.

    “The people on the distribution list for these groups have chosen to be on it,” Tapia says. “Employers can work with those leaders to increase participation.”

    Even with accurate data on demographics, employers need to be careful in crafting the same message differently for specific groups. Often, the message needs to be rooted in cultural beliefs and motivators. Tapia says that some cultures have a fatalistic view of health care and won’t be moved to act simply by seeing a face resembling theirs on a flier. But appealing to their sense of family or other cultural stimuli may motivate people to get that checkup or take action on another health-care need.

    Having health professionals speak specific languages is also a major motivator for some groups, experts agreed. Chinese Community Health Plan won the National Committee for Quality Assurance’s award for culturally centered case management by using bilingual registered dieticians, nurses, educators, administrative assistants and others as part of its effort to educate members about the growing incidence of diabetes within the Chinese community.

    It’s important to have these kinds of multilingual and culturally sensitive health care and administrative professionals in networks if employees require them, Darling says. Today, employers need to tell providers that not meeting these requirements is unacceptable.

    Employers “need to make sure these systems are in place,” Darling says.

    Another way to motivate behavior is to create partnerships with other stakeholders. The National Committee for Quality Assurance recognized Detroit-based Health Alliance Plan for its work in increasing the number of breast cancer screenings for its African-American female members working at Ford Motor Co., Daimler-Chrysler and General Motors.

    In 2004, Health Alliance Plan looked at breast cancer screening rates for these members, ages 50 to 69, and found that 81 percent of white women received screenings, versus 76 percent of African-American women. To increase participation, the plan worked on several levels: It created brochures with culturally tailored information, gave out $20 Target gift cards to women who were screened, and created a weekend walk-in event where women who received mammograms got other perks including, massages and refreshments.

    Within two years, screening rates for African-American women rose to 82 percent. One woman who hadn’t received a mammogram in 10 years said the outreach motivated her to get screened again. “This is a plan that demonstrated success,” Briefer French says.

    For this effort to be truly successful, employers need to link their commitment to diversity with their commitment to ending disparities in health care, Tapia says. In time, this will happen, but currently, very few companies see these two areas as being interconnected, he says.

    Employers are well schooled in the need for tolerance and sensitivity when it comes to race and ethnicity in the workplace. But when it comes to health care, it’s time to address the very real differences that exist among minority and ethnic groups.

    “This is new territory, and employers are starting to experiment and see how it feels for them,” Tapia says. “It’s not a one-size-fits-all solution. These cross conversations need to happen. All kinds of synergies can develop.”

Townsend Wardlaw would rather write a salesman a $200,000 check on a $1 million deal than pay half of a $95,000 base salary over six months and have nothing to show for it. Wardlaw agrees it’s a lot of money, but he thinks it’s worth it.

    “Not only do we get what we’re paying for, but we get better results,” says Wardlaw, founder and CEO of Three Value Logic Sales in Denver.

    The method Wardlaw uses with his sales force is called activity-based compensation. It’s a form of variable pay where part of employees’ base pay hinges on specific goals. At Wardlaw’s sales outsourcing company, employees receive the cash rewards for their hard work on a quarterly basis.

    It’s a compensation strategy built right into an employee’s base pay that companies can use to achieve long-term goals by setting short-term objectives. Employees get paid when they deliver on the immediate needs of the company.

    About 10 percent of a salesperson’s base salary at this Denver company is tied to specific quarterly goals, including number of calls, meetings and landing new opportunities. Wardlaw says it’s his responsibility to set clear expectations, but each salesperson needs to hit those marks to earn their full base salary. Salespeople who meet those short-term goals have the potential to double their earnings through additional bonus pay.

    Activity-based compensation protects the company cash since the company isn’t paying an employee’s full salary without seeing results Wardlaw says.

    “It gives [employers] tangible value for their money,” he says, adding that the company has been paying its employees this way for about three years.

    Meanwhile, Affiliated Computer Services Inc. is working to incorporate activity-based compensation into the base salary of each of its 60,000 employees. ACS created its program from scratch about 10 years ago, and keeps the details closely guarded. Tom Blodgett, president of ACS’ Business Process Solutions Group, says the program improves productivity, work quality and employee satisfaction, and offers myriad other benefits.

    “It allows us to be more competitive, enough to make a difference in winning deals,” Blodgett says.

    ACS, a worldwide business process and information technology outsourcing company based in Dallas, gauges employee performance on the quality and quantity of work, in many cases. Blodgett says four or five measurements usually are set. If needed, the sophisticated program can change the criteria each pay period. Most employees on this pay schedule can check their performance daily. Paychecks can fluctuate depending upon how well employees meet or exceed the goals.

    To have a successful activity-based compensation program, employees need to understand the metrics and how they influence their results, as well as to see how they’re doing, says Steve Gross, global broad-based performance and rewards consulting leader with Mercer. Plus, employers should offer a minimum of 10 percent of the employee’s salary.

    “If you don’t put something on the table [an employee] can do something with, then you’re not going to motivate [the workforce],” Gross says.

    Employers also need to measure the right thing, observers agree. Generally, employees will do what they are told, Wardlaw says.

    “You need to do your job as a leader and define success, as opposed to waving a wand and expecting it to happen,” Wardlaw says. “Then you need to pay for that contribution to success.”

    If an organization measures something like an average handling time, Gross says, they need to be careful that specific measurement doesn’t encourage employees to skimp on delivering high-quality services.

    “It isn’t a bad metric, but you can send the wrong signal,” he adds.

    But once accurate goals are set, results should pour in.

    At ACS, one group that handles benefits for a client saved about 23 percent more than what was projected. Work quality rose five percentage points to 97 percent and productivity increased nearly 30 percent. While Blodgett would not divulge any more details on this group, he did say these results are typical of ACS employees on activity-based compensation.

    “We feel our workforce is the cream of the crop in terms of productivity,” Blodgett says.

    Another added benefit, many agree, is that most low-performing employees leave the job before the company needs to fire them. Because those employee aren’t making the money they expected, they usually go elsewhere.

    “On initial implementation, turnover is higher,” Blodgett says. “Not everyone can handle it.”

    Recently, ACS was in the news over a public confrontation between its chairman and certain board members. Five board members quit, and in early December, ACS chairman Darwin Deason agreed to amend his employment agreement, curbing his right to appoint specific officers and capping his voting power on his outstanding shares.

    While Blodgett admits it was a tumultuous episode, many ACS employees stayed on task. Sales “may have paused” he said, but new business is picking up significantly. The company is on track to grow revenue to $10 billion by 2010, he added.

    Although the company didn’t track the effect of this issue on its employees, those who are paid based on their productivity levels have historically been high performers whose efforts help improve the bottom line. The company’s annual report showed an 8 percent increase in total revenue in 2007, rising from $5.4 billion in 2006 to nearly $5.8 billion last year.

    “ABC is so effective and so fair, the more people we can get on it, the better,” Blodgett says.