"We Are What We Do" by Tim Church, M.D., M.P.H., Ph.D.

Living well and living long are two different things. and one of the country's leading preventive health researchers, Dr. Tim Church, states it plain and simple—maintaining a high quality of life means finding time for physical activity.

Dr. Tim Church, Holmes Murphy & Associates  / ACAP Health Medical Director on exercising your right to a better quality of life  

One of the things I've really learned in medicine is that there are certain things that resonate with us that we believe in, with or without data – it just must be true. And the idea of, 'we are what we eat,' it is amazing to me how people hold onto that. People have a hard time getting their arms around, 'we are what we do.'

As a physician, through med school, through residency, I just got frustrated with treating things that were 100 percent preventable. And, you know, I love to say we like to heroically clean up after the car accident, but we don't like to put up stop signs. And, I just was always drawn towards prevention and then in my prevention quest so to speak, physical activity and exercise just made so much sense. It didn't matter what the analysis was. It didn't matter what we were looking at. There was always this one variable that was so powerful. It was exercise.

When it comes to weight loss one of my favorite sayings is: you diet to lose weight, and you exercise to keep it off. It doesn't matter what the macronutrient components of that diet are. You can focus on low carbs. You can focus on low protein. You can focus on low fat. It doesn't really matter. It tends to be an individual thing.

But, once you get the weight off, exercise becomes so critical in keeping it off. It's not hard to lose weight. It's very easy to lose weight, that's why all the fad diets work. That's why all this bogus stuff works. The challenge is keeping the weight off, keeping it off at six months, keeping it off at 12 months, keeping it off at two years.

Everything counts. If you're doing nothing now, this is not all or nothing, this is not about, 'hey if you don't get to 150 minutes a week, then it's a waste of time.' Just getting off the couch has benefits. In fact, the most sedentary individuals who have the worst health are the ones that benefit the most from a little bit of physical activity. The return on investment for a little bit of physical activity is huge for those guys. The person who's running a 10K all the time and ramps it up to a marathon. They don't get any more benefit when they go from 10K to marathon, they've already kind of maxed out. But that person who's totally sedentary and takes up a walking program? Huge benefits.

It's not about how long you're gonna live. How long you're gonna live is primarily determined by how long your grandparents lived, how long your parents lived. It's about how long you live well. Can you go duck hunting in your 80s? Can you chase your grandkids? You know, can you do the things that you love doing? And there's no pill for that. We can't go to the doctor and get a pill for quality of life. There's one thing we know that works for maintaining quality of life. And that is being physically active. That is leading an active lifestyle which may or may not include formal exercise. So, you want to lead the life you want to lead? You've got to be physically active.

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Benefits Insight from a Twitter Founder

Jack DorseyJack Dorsey, the founder of Twitter (and now Square) once famously quipped that as business leaders we should "make every detail perfect and limit the number of details to perfect". As employee benefit advisers, human resource and benefit professionals and service providers deal  with new regulations, burden shifting and changing roles in a fast-changing employee benefits industry, we sometimes lose sight of who we are serving. As long as an employer is paying the majority of the costs, the employee benefit programs is an investment that reflects the culture and value placed upon the people in the organization.

It might surprise some business owners to learn that the "perceived" value of the benefits actually has less to do with the family out-of-pocket amount and office visit copay and more to do with benefit  experiences throughout the year.   This was reinforced through a study by Deloitte that identified the high direct and indirect expense of turnover when good people leave their jobs because of bad management and poor culture. Employee benefits did not even make the top ten list of the reasons to jump ship.

Sure, getting the benefits design of your programs to reflect your company's core beliefs is an important first step along with selecting the right service providers and making sure we are in federal and state compliance.   But all too often we run out of time to pay attention to the details that matter most ... the enrollment and user experience for our customer.   Selecting a plan provider and paying the majority of the premium is hardly where the responsibility ends.

Have you seen this before in your benefit materials ... Call this number to set up an appointment, fax this form to this group, set up another user name and password to qualify for this, watch this video and fill out this form to get this, do these 10 meaningless things that will not impact your health ... and my favorite ... read this ... but don't take any action now (I just want you to inform you of these things that will add more stress to your world ... along with work and family obligations, missing planes, Ebola viruses, impending Cold War and Middle East unrest) but check back later for more details from your HR team. Also, plan to keep an an eye out in your inbox for more important dribble about your employee benefits that does not have any call to action or benefit to you or your family members.

Jack Dorsey gets   it right ... because he cares about the ultimate detail, design and user experience.   Twitter was about a simpler way to communicate.   Square and Apple Pay are trying to improve the buying experience.   When it comes to delivering employee benefits, we are always on target if we ask how we  can  make the service experience better for  those whom we serve.

No Health Insurance - IRS Shows Us How Penalty Is Calculated

w2form-picIf your like me ... you may have thought the IRS penalties imposed for not having health insurance under the new ACA federal healthcare rules simply utilized the greater of 1% or $95 calculation by applying 1% times adjusted gross income.

This week, Ed Oleksiak, JD, Holmes Murphy's national compliance lead, walked our  consulting teams through how the the IRS will apply the penalty.   So the 1% individual penalty is not just 1% times your   income.   You actually subtract a base amount which is the minimum thresholds for being required to file a tax return determined by filing status and then the 1% is multiplied times the resulting net income amount.   The starting amount is household income.   We are including a definition and example below.

Household income is the adjusted gross income from your tax return plus any excludible foreign earned income and tax-exempt interest you receive during the taxable year. Household income also includes the incomes of all of your dependents who are required to file tax returns.

Example: Single individual with $40,000 income

Jim just plain does not like politics or federal mandates.   He is an unmarried gun-toting, iPhone 5s carrying young invincible   with no dependents.   He pays service fees each month to access his Match.com   account ... but feels paying monthly health insurance premiums does not help him with the ladies.   Jim  does not have minimum essential coverage for any month during 2014 and does not qualify for an exemption. For 2014, Jim's household income is $40,000 and his filing threshold is $10,150.

To determine his payment using the income formula, subtract $10,150 (filing threshold) from $40,000 (2014 household income). The result is $29,850. One percent of $29,850 equals $298.50.

Jim's flat dollar amount is $95.

Because $298.50 is greater than $95 (and is less than the national average premium for bronze level coverage for 2014), Jim's shared responsibility payment for 2014 is $298.50, or $24.87 for each month he is uninsured (1/12 of $298.50 equals $24.87).

Jim will make his shared responsibility payment for the months he was uninsured when he files his 2014 income tax return, which is due in April 2015.

2014 Federal Tax Filing Requirement Thresholds

Filing Status

Age

Must File a Return If Gross Income Exceeds

Single

Under 65

$10,150

65 or older

$11,700

Head of Household

Under 65

$13,050

65 or older

$14,600

Married Filing Jointly

Under 65 (both spouses)

$20,300

65 or older (one spouse)

$21,500

65 or older (both spouses)

$22,700

Married Filing Separately

Any age

$3,950

Qualifying Widow(er) with Dependent Children

Under 65

$16,350

65 or older

$17,550

Health Plan Identifier (HPID) - A Must Do by November 5th, 2014

If your company sponsors a health plan (excluding small plans), and you have administrative oversight of that plan, you must get a Health Plan Identifier (HPID) under HIPAA by November 5th, 2014. You might be saying, I already have a lot on my plate or I would rather wait to do this in November.   Sure, you could wait until things get slower around the fall during open enrollment or look into this before the holidays.   Or you or a member of your HR/Benefits team could knock it out today.

Here are  the instructions  our firm put together to assist our clients.

This is being required by our federal government ... don't shoot the messenger ... we are simply trying to urge our clients  to do this now.

Carrots and Sticks are for Donkeys and Mules

The following is a must watch for anyone who endeavors to change the health risk of a population. Our industry needs to move beyond treating our people like they are asses.  We assume humans are like farm animals motivated by dangling a carrot or giving a smack on the rear. As Dr. BJ Fogg explains in the video below, an employee's level of motivation is hardly the culprit.     

The research and understanding of "B=MAT" - behavior = motivation, ability and trigger ... is worth the small time investment it will take to watch this video.  Dr. Fogg’s research is some of the most groundbreaking in terms of how human beings change behavior. Dr. B.J. Fogg is the Director of the Persuasive Technology Lab at Stanford University.

I came across this video at Rock Health when launching my own startup in the digital health technology space.

The HSA Turns Ten

Celebrating Ten Years HSAThere are some larger than life personas residing in Dallas who have had a profound impact on shaping our nation's health care system. It was December of 2003 when President Bush had just signed into law the Medicare Prescription Drug Improvement and Modernization Act. John Goodman, head of the Dallas based National Center for Policy Analysis (NCPA), helped give birth to provisions of the bill having contributed much of the thinking around HSA's and how a consumer's right to vote with their own pocketbook could change the health care marketplace. While Goodman may have been the mother who conceived of the HSA and George W. Bush the father of the bill, this tax-advantaged baby got delivered to my team's front door step while consulting with a Fortune 500 client out of Austin, TX.   It was 2003 and this company's leadership team was wrestling with an unsustainable health trend and a culture ready for change.   They were the first and largest company in Texas to launch a qualified High Deductible Health Plan (HDHP) with an HSA in 2004. From conception of the design to the final delivery to employees, this work was significant and groundbreaking as employees at this company began to learn to use insurance for its intended purpose.

According to the Employee Benefits Research Institute (EBRI), since the bill was signing into law, HSAs have since grown to 16.6 billion dollars in assets. In 2013, these assets grew 5.3 billion, a jaw dropping 47% increase over 2012 assets.   Meanwhile, Health Reimbursement Arrangements (HRAs) are moving in the opposite direction with assets shrinking by 2% to 5.7 billion dollars last year.

There is a massive shift taking place in the market as consumer's continue to shoulder more of the out-of-pocket expense of health care and demand greater transparency over quality and cost. It has forced hospitals and physicians to cope with collections and bad debt since "we the people" are not always as reliable paying our bills as a large insurer.   HSA linked plans have also sparked innovations from new swipe-card technology to alternative forms of free market care delivery.

While our country's legislators and many employers are currently fixated on  purchasing health insurance, the real challenge over the next decade will be how incentives can be aligned to produce systemic behavior change that leads to the reduction and  production of disease.

In 2013, more than 15 million individuals were enrolled in HSA-linked plans, a 50% increase in just three years.    In 2014, reports indicate about 18% of employees will enroll in a tax-advantaged accounts linked to a high deductible plan.   Here are a few reasons why HSA's will continue to thrive over the next decade:

1. Taxes are high - Marginal tax rates are at 39.6% and corporate taxes exceed those of other industrialized countries. Adopting tax-efficient plan design strategies like maximizing annual and catch-up contribution limits and using captives where appropriate will make sense for astute plan sponsors who care enough to reduce their own corporate and their employee's tax burden.

  2. Qualified High Deductible Plans Are No Longer "High" - The minimum deductible and out-of-pocket requirements may have seemed high in 2003, but the 2014 minimum annual deductible of $1,250 is not that far from the $1,100 average annual deductible nationwide and well below the $1,700 average for small firms (under 200 workers).   By the way, just because the legislators called it a "high" deductible health plan does not mean you need to promote it as such when you roll it out to your employees.   Ask your benefits communication team to come up with something snappier.

3. They cost employers less - HSA linked plans cost employers about $1,700 less per employee compared with traditional PPO plans, according to a 2013 Mercer survey. In one of the first studies of its kind, EBRI found HSA linked plans reduced total health care spending by 25% in its first year and over the succeeding three years — albeit at a slower pace.

So Happy Birthday HSA ... It's time to toast you and those who nurtured you to ten. Here's to another a decade of market-driven progress enabling those who take measurable steps to improve their health to continue investing in themselves.

 

Health Care Pricing ... All Over the Map

Health Care Prices All Over the MapIt's always fun to watch shoppers each holiday season camp out for hours to snap up bargains that pale in comparison to the savings available in the health care marketplace.   If buyers put as much emphasis on shopping for health services throughout the year as we do on enrolling for coverage once a year, we could make greater strides to flatten the cost trajectory of care. If there is one city that knows how to shop it's Big D, so here's a three-step process for any employer hoping to put a little "Black Friday" in their health plan:

1. Offer A High-Deductible Plan:

A 'quiet revolution in health insurance' is taking place as the number of employees enrolled in a plan with an annual deductible of $1,000 or more has risen to nearly 40% in 2013.   Among all plans, the average annual deductible among covered workers is over $1,100 and exceeds $1,700 for small firms (under 200 workers).   (Kaiser/HRET Survey of Employer Sponsored Health Plans).

Milton Friedman wisely quipped "Nobody spends somebody else's money as wisely as he spends his own.   Putting in a high deductible plan enables your employees to be economically rewarded for shopping around and strategically aligns your insurance plan to cover infrequent and high cost medical events.

2. Arbitrage your Network

In the 20th century days of health care consulting, we used to attend to great detail to reprice claims for employers wanting to select the right insurer and network health plan.   This focus on network discount has given way to more sophisticated value equation models.   Once your health plan/network is in place, the employer must then teach employees to exploit hidden value within the network throughout the year.

60% of medical and pharmacy claims come from non-emergent services.   As an example, three facilities within a five-mile radius in Dallas offer the same in-network MRI for prices ranging from $600 to $3,000.   Transparency laws are now enabling big data analytics software to quickly review over a billion national claim records for price and quality comparisons at the push of a button.

3. Shop with a trusted friend

The best health price transparency providers have realized that shopping for care is best delivered when technology is married with an independent consumer advocate.   As an example, there are over thirty types of knee surgery, so having a personal concierge to help me navigate my options enables my family to build trust with an advisor that does not have a financial interest in the outcome.   To revolutionize the system, we need to help our employees act on information, not just provide data.

Many DFW employers are well on their way to creating a shoppers mentality among their health plan enrollees.   Consumer advocacy and pricing transparency programs have already returned annualized savings anywhere from four to twenty-four times the cost of the service.

In a town that continues to reinvent the shopping experience, we anticipate more companies to get on the "Black Friday" bandwagon when it comes to savings in their health plan. The best part is we can all be empowered to score health deals that would make a Walmart clerk gush just by picking up the phone.

Top Ten Healthcare Predictions for 2014

20141. With UT falling to Baylor, another 50/50 season for the Dallas Cowboys and a botched HealthCare.gov rollout in 2013, predictions for 2014 have head coach, Jason Garrett and U.S. Secretary of Health and Human Services, Kathleen Sebelius joining the ranks of Mack Brown and the unemployed ... At least they will have a new health insurance option available to them when they leave their employer. 2. Consumer health devices, mobile and telehealth initiatives will continue to bring about market-based reforms that enable better tracking, monitoring, and care coordination for patients with chronic conditions, who lack access to primary and specialty care or for those payers and providers willing to experiment with technology enabling solutions.

3. Watch for continued M&A activity with health systems similar to Baylor Scott & White or Tenet (Vanguard Health) in other areas of the country. Health care delivery systems will continue to survive and thrive through specialization, mergers, or partnerships that lead to even bigger systems of care.

4. After the elections in November 2014, more carriers will exit the exchange system or become even more selective with their markets and propose double digit premium rate increases as the demographic underpinnings of the exchange fail to capture the 18-34 age group needed for the law to succeed.

5. With less than predicted young people signing up for HealthCare.gov, watch for legislative push to increase penalties for those who did not adhere to the requirements in the law in 2014. There will also be a healthy amount of debate over whether the penalties should be waived in 2014 due to the botched website rollout of healthcare.gov. [The penalty for 2014 is the greater of $95 a year or 1% of adjusted gross income].

6. The political rhetoric of "repeal and replace" will eventually give way to the demands of the American people searching for bipartisan amendments and solutions that target the real enemy in this country ... a broken fee for service environment that pays for the reimbursement of treating disease. The government will not shut down in 2014.

7. Employers will continue to adopt tax-efficient plans (such as high deductible health plans with health savings accounts) as new taxes (associated with ACA's funding) become more transparent to higher wage earners. Private health exchanges will grab the attention of employers interested in defined contribution approaches to funding their benefits.

8. Companies will abandon large incentives associated with traditional first generation wellness offerings (HRA's, Biometrics, and Wellness Content) in favor of programs that actually show promise of changing behavior to combat the effects of smoking, obesity, metabolic syndrome and diabetes — Pharmacotherapy and surgical options will gain more traction for those who qualify.

9. Watch for the continued proliferation of programs that provide price transparency and consumer advocacy. Consumers and large payers will become more educated around the disparity in pricing among health care facilities and providers. Congress will try and respond with everything from price controls to transparency bills.

10. Congress will not be able to agree to the Medicare cuts that are the underpinnings of the Affordable Care Act. The Office of Management and Budget (OMB) will run new actuarial calculations that increase the size of the federal deficit beyond what our children can bear.

The One Thing Needed for Exchanges to Succeed

Young people are the most coveted of all participants to have enrolled in a health insurance plan.   It is the concept that underlies group underwriting to have those with fewer health risks to help offset the cost of those who are older and have greater medical needs.   Dallas ranks as one of the largest communities of uninsureds in Texas at 31% compared to a 26% state average. Many of these uninsureds are young people (ages 18-35) who have relied on our public health system to be there if things do not go as planned.

The very success of the Affordable Care Act (ACA) will depend upon convincing these "young invincibles" that health protection is worth purchasing.   If only the public exchanges could be as inviting as an Abercrombie & Fitch, Hollister or a Juicy Couture. The federal government is projecting enrollment in the exchange system to be around 7-8 million by the end of 2014.   As the law intends, the cost of insuring the most expensive users of the system must be offset by around 2.7 million of young invincibles between the ages of 18-35 for it to work. In the first month of enrollment, 26,794 people selected a health plan on the federal exchange website. The makeup of these enrollees has not been released by the federal government, but a demographic match to the patronage of a cafeteria restaurant is to be expected.

As exchange enrollment begins to materialize in 2014, public officials may wish to revisit the following if they hope to enroll the most coveted young adults:

1. A Retail Experience That Works - When the standard young people are used to is designing their own Nike shoes online or ordering Uber's transportation service at the push of a button, HealthCare.gov will find itself quickly falling off the browser's  "favorites" list.   In a November survey by USA Today, many young people will not try again until December and cannot even comprehend calling a 1-800 number for service.   We all like using intuitive technology that works ... but young people demand it even more ... a problem plaguing HealthCare.gov for the foreseeable future.

2. Changes to Employer Plan Dependent Definition  - Many employer plans used to only cover dependent children up to age 19 or 26 (if a full-time student).   On January 1, 2014, all employers (grandfathered and non-grandfathered) will be required to extend coverage to dependents up to age 26.   The chief actuary at CMS is likely regretting the legislature's decision to extend dependent coverage to age 26 for employers.   With 60% of American's covered by employer-based plans, this leaves a smaller group of of younger adults to enroll under the public exchanges.

  3. Affordable Coverage -  Older Americans will pay a higher rate than younger Americans, but the community rating is tiered using only three different age group bands. AARP lobbied strongly for this and it is an absolute boon to the baby boomers and a real shaft to Generation X, Y, and millennials who will bear the brunt of the top third-oldest risk tier by age. Age rating bands of 3:1 will prevent insurers from charging an adult age 64 more than three times the premium they charge a 21-year-old for the same coverage. As a result, young Americans will see higher premiums under the Exchanges than when they could have purchased coverage (Pre-ACA) in the private market when they used age rating bands of 5 to 1.

The Obama administration's federal study found that if all 50 states had expanded their Medicaid coverage the way they were supposed to when the law was passed, almost 90 percent of single Americans under 35 years could get coverage that cost less than $100 a month. They did not count on a Supreme Court ruling that enabled 25 states to opt out of expanding Medicaid coverage. This created unexpected "cracks" in the system when many young people who were to have qualified for Medicaid coverage will find they do not earn enough for subsidies under the Exchange.

In an astute political move, the Obama administration pushed back the requirements to release projected increases in health premiums for 2015 until after the November 2014 elections. In 2014 our young adults will eventually have to make a decision to pay the federal penalty (the greater of greater of $95 or 1% of AGI annually) or buy health coverage. Here's betting their XBox One they pay for neither.

Is the obesity crisis hiding a bigger problem?

From Leonardo da Vinci to  Dr. Atkins, society often ridicules those with different points of view. Here Dr. Peter Attia discusses some compelling reasons why we might want to question the conventional thinking around obesity and insulin resistance.   Dr. Peter Attia's presentation has nearly garnered 1MM views and it's worth the watch.

As a young surgeon, Peter Attia felt contempt for a patient with diabetes. She was overweight, he thought, and thus responsible for the fact that she needed a foot amputation. But years later, Attia received an unpleasant medical surprise that led him to wonder: is our understanding of diabetes right? Could the precursors to diabetes cause obesity, and not the other way around? A look at how assumptions may be leading us to wage the wrong medical war.

Both a surgeon and a self-experimenter, Peter Attia hopes to ease the diabetes epidemic by challenging what we think we know and improving the scientific rigor in nutrition and obesity research.

Source: TEDMED   - April 2013

 

Lighten Your Load or Pay More!

Lighten your load or pay more! This NPR report describes rationale for why it is permissible under the federal health reforms for employers to use incentive programs encouraged healthy behaviors.