Johnson & Johnson Services, Inc.

Narrative Description of Program

Johnson & Johnson Health & Wellness integrates disability management, occupational health, employee assistance, work-life programs, wellness and fitness.  Its Vision is to optimize the health, well-being and productivity of Johnson & Johnson employees.  It is an outgrowth of Johnson & Johnson LIVE FOR LIFE®, which originated in 1979 and brought together experts in health education, behavioral change, and disease management to create a program to improve employee health and productivity.  The program underwent transformations in the past two decades to respond to changing business requirements and employee health needs.

The cornerstone of the enhanced Health & Wellness health promotion initiative is the Health Risk Assessment (HRA) and Intervention Program.  More than 90% of eligible domestic employees chose to participate in the HRA, a dramatic increase from 26% participation in 1995. Participation increases correlated to an incentive of $500 in benefit credits. The program achieved savings of about $9-10 million per year primarily from reduced medical utilization ($3.96 million) and lower administrative expenses ($5.22 million).

Based on an analysis of the impact of the integrated Health & Wellness Programs, a strategy was put in place in 2002 to link health promotion measurable outcomes and risk reduction goals and cost savings. We recently launched this new strategy, Healthy People 2005.

Healthy People 2005 focuses on: smoking/tobacco use, blood pressure, cholesterol and inactivity. Over the next two years, we will measure progress toward goals aligned with national Healthy People 2010 objectives. Other health indicators, including obesity and stress, are currently addressed and will have set targets in the next phase of implementation.

*Based on Health Risk Appraisal Results 1995-99

As part of Healthy People 2005, Health & Wellness works collaboratively with management and employees providing resources and support to implement leading-edge programs.  The impact of achieving our Healthy People 2005 goals will result in an estimated cost avoidance of $7.5 million annually.  Productivity gains will also contribute to a positive bottom line.

In two recent studies, results indicated that Johnson & Johnson Health & Wellness Programs saved the company over $38 million from 1995-1999, and demonstrated improvements in population risks in eight categories. Study findings were published in the Journal of Occupational and Environmental Medicine in January and May 2002. Please refer to the enclosed studies for more details.

Background

• Johnson & Johnson (J&J) reorganized its Health and Wellness Program (HWP) in 1995 by integrating Employee Assistance, Occupational Health, Wellness, Disability Management and Medical Care Management
• A key element was participation in a Health Risk Assessment (HRA) and follow-up high-risk interventions (Pathways to Change)
• 90% of eligible employees (approx. 43,000) participated in the HRA or intervention programs

Data Evaluated

• Health care utilization/costs (inpatient, outpatient, mental health, emergency room claims) for individual employees in 1990 – 1999 (average N for the study cohort = 15,028 employees)
• Short term disability (STD) - site-level data on days off work due to STD, for up to 81 J&J sites in each year from 1995 – 1999
• Workers’ compensation (WC) case rates for all of J&J for 1989 – 1999
• HWP administrative costs – measured as prices charged to affiliates in 1993 (before HWP) and 1995 – 1999 (after HWP)
• HRA data from two applications of the HRA for high-risk employees (~ 33 months apart, N = 4,586 employees)

Financial Impact Outcomes Measured

• Health care utilization and expenditures
• Days lost to short-term disability
• Expenditures for workers’ compensation, and
• Administrative savings for health-related programs.

Statistics Employed

• Medical: Regression analysis adjusting for differences in person-level characteristics
• Short-Term Disability: Regression analysis adjusting for site-level differences
• Workers’ Compensation/Administrative: Company level pre/post descriptive analyses
• Health risks: McNemar chi-square tests comparing proportion at high risk at Baseline vs. Time 2.

Results

• The program achieved savings of about $9.10 - $9.43 million per year
• Most savings came from reduced medical utilization ($3.96 million) and lower administrative expenses ($5.22 million)
• Overall savings per employee per year since 1995 total approximately $225 annually.

• For participants in Risk Intervention Programs, savings totaled approximately $390 per participant.
• The percent of employees at high risk for the following risk factors decreased over time:
  • Low fiber intake: 50% to 41%
  • Cigarette smoking: 33% to 24%
  • Snuff use: 1% to 0.5%
  • Poor exercise habits: 46% to 35%
  • Lack of seat belt use: 5% to 3%
  • Drinking and driving: 4% to 3%
  • High cholesterol: 66% to 43%
  • High blood pressure: 10% to 1%
• The percent of employees at high risk for the following risk factors increased over time:
  • High fat intake: 22% to 25%
  • High body weight: 76% to 78%
  • Diabetes: 49% to 52%
  • Cigar smoking: 1% to 2%

Through Healthy People 2005, Health & Wellness will partner with each operating company to improve the overall health of our organization. Achieving our targets will result in an estimated cost avoidance of $7.5 million annually through a reduction in health care costs and an increase in productivity. This will also contribute to the strategic mission and financial success of Johnson & Johnson. And, most importantly, our employees will enjoy improved health.
Healthy People 2005….Better Health, Better Future.

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The following are verbatim remarks made by the reviewers:

A

• Excellent job of presenting data and documented savings

B

• 90% participation/incentive $500 in dividend credits
• Peer-reviewed thorough evaluation by external group (2 pages, Medstat)
• Savings $9 million/year.4:1 ROI $225 annually per employee
• Integrated occupational health, disability, wellness, and medical benefits
• 4-year study
• Pre-post evaluation with regression adjustment

C

• Strong program – obviously knows and has proven the links between behaviors and healthcare utilization
• Strong history with the program components
• Incorporates HRA with interventions – high participation rate!! (with good incentive$$)
• Links to total health management – medical claims, work comp, disability, etc
• Solid research models used – excellent data collection and interpretation

D

• Good application and great results
• Like the approach of HP 2005 and its tie-in
• Appreciate including the article copies
• Good long-standing program

E

• J&J Health & Wellness starts from a position of advantage based on its excellent programming and management commitment since 1979. The HP 2005 approach is very specific, with reasonable targets and meaningful projections of avoided costs
• The commitment to evaluation over the years is commendable. The program integration since 1995 presents a successful roadmap for managing the entire health contest. This program is well published and well positioned in the culture of the Co.

F

• This is a comprehensive, integrated program. Achieving participation rates of 90% is very impressive. The health and financial savings reported are impressive, and the documentation of these claims is adequate

G

• A true “flagship” company and programs. Excellent, long standing commitment to research and peer review publication. Sets one of the true high water marks for the industry