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Risk Assessment Pays Off at Johnson & Johnson

Between 1995 and 1999, medical care costs decreased by $225 per person.

September 18, 2003
Related Topics: Health and Wellness, Compensation
Large Company
Name: Johnson & Johnson
Location: New Brunswick, New Jersey
Business: Health-care products manufacturer
Employees: 40,000 in the United States

In 1995, Johnson & Johnson’s health and fitness group took a simplestep that catapulted participation in the company’s wellness program from 26to 90 percent, says Patricia Flynn, vice president of Johnson & Johnson’shealth-care system. They offered every employee a $500 health-benefits credit inexchange for completing an annual health-risk assessment before enrolling in theplan.

    The company had offered the assessment optionally for years as part of itswellness program, but it was not until the incentive was attached that employeesflocked to it. "People think they are fit and might not want to bother with anassessment," Flynn says. "This incentive got them to do it."

    The assessment is completely confidential and is conducted by a third-partyadministrator to ensure privacy--an early concern for employees who fear thattheir information might be used in hiring or firing decisions, Flynn says. "Theinformation gathered is only shown in aggregate to management, while theemployees get individual reports on their risk status." Employees can alsocheck an optional box on the assessment to be contacted with informationregarding any disease they are at risk for. "So many of them checked the boxthe first year, that tells me their privacy fears were alleviated," Flynnadds.

    In the past, the company offered incentives for participating in variouswellness programs, but now all of their incentive dollars go toward the riskassessment, because they feel it brings the greatest return for the investment."We are confidant that once employees know what their risks are, then we canmake a positive impact on their health," says Jennifer Bruno, director ofbusiness planning. Early studies conducted at the company showed that even thoseemployees who took the assessment but had no follow-up support through wellnessprograms showed improvements in their health, she adds.

    But for Johnson & Johnson, the assessment is just the beginning. Theaggregate data helps the health-care group choose the right wellness programsfor the exact needs of the population, Bruno says. The program developers aren’tguessing at employees’ health interests or expecting them to know whatprograms they will benefit from, she says. They use the hard data to guide theirwellness program choices. "We are making better use of our health-caredollars, thanks to the assessment information."

    For example, the initial assessment showed that the employees have threeareas of risk: high cholesterol, high blood pressure, and inactivity. Thecompany now regularly offers exercise and counseling programs to help employeesreduce cholesterol and blood pressure and manage weight. Bruno says there arealso subtle additions to the workplace environment that contribute to a healthyculture, such as nutritious choices in the cafeteria, scales in all of thebathrooms, and a non-smoking environment.

    Since the assessment and resulting wellness programs were implemented, costshave decreased significantly at Johnson & Johnson. Between 1995 and 1999,medical-care costs decreased by $225 per person--due to lower administrativeand medical utilization--which amounts to an annual total savings of $8.5million. For those employees who were discovered to be at high risk for adisease and then reduced their risk, the savings is $390 per year, Bruno adds.Preliminary studies show that this level of savings should continue every year."Because people are becoming aware of their risks earlier, they are takingsteps to improve their health," says Bruno, "which means they will use thehealth-care system less."

Workforce, December 2002, pp. 76 -- Subscribe Now!

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