MEDICAL BENEFITS

3

congestive heart failure, and depression. Yet, these physi- cians’ use of care management tools varied widely, and interventions backed by the strongest evidence of effec- tiveness were used much less frequently. Both practice size and setting, as well as the specific chronic condition being treated, were strongly associated with the use of certain care management tools.

Three-quarters of physicians reported offering patients written educational materials, but use of other tools for patient education and improved self-care was much lower. Half of physicians reported using nonphysician educators, one-third used nurse managers, and one-fifth used group visits. The higher use of written patient education materials may reflect expediency rather than effectiveness. Written materials are inexpensive and require little upfront invest- ment compared with the other interventions described, but they are also associated with the least benefit.

Physicians more uniformly used tools offering feedback on the quality of their care, which can help identify areas for improvement. About two-thirds of physicians reported receiving reports on the quality of their preventive and chronic care, and 42% used registries to identify patients with specific chronic conditions. However, some of these reports and registries may be generated by patients’ insur- ers rather than by physician practices and thus may not apply to all patients treated by a practice.

Overall, 47% of physicians were in practices that used two or fewer of the seven care management tools, and

4% were in practices using six or seven care management tools.

Physicians in larger groups were more likely to use nearly every type of care management tool than phy- sicians in solo or two-physician practices. Likewise, physicians in group- or staff-model health maintenance organizations (HMOs) were the most likely to use all of the care management tools.

Among primary care physicians whose practices treated patients with asthma, diabetes, depression, and conges- tive heart failure, most used care management tools for patients with some conditions but not others. Physicians using tools in their practices for patient education and improved self-care—written materials, nurse managers, nonphysician educators, and group visits—were asked about which tools they used for which conditions. With the exception of written educational materials, less than 15% of physicians reported using any tool across all four of the chronic conditions. Care management tools aimed at patient education and improved self-care were more widely adopted for diabetic and asthmatic patients.

Less than one-third (29%) of primary care physicians reported having a fully electronic medical record. Among these physicians, 54% used physician reminders to provide preventive care and 34% generated patient reminders.” MB

Full text is available online. Web site: www.hschange.com/ CONTENT/1101/

WORKPLACE HEALTH & BENEFITS

Workplace Wellness Programs Can Generate Savings Katherine Baicker et al., Health Affairs Web Exclusives, January 14, 2010

“Amid soaring health spending, there is growing interest in workplace disease prevention and well-

ness programs to improve health and lower costs. In a critical meta-analysis of the literature on costs and savings associated with such programs, we found that medical costs fall by about $3.27 for every dollar spent on wellness programs and that absenteeism costs fall by about $2.73 for every dollar spent. Although further exploration of the mechanisms at work and broader applicability of the find- ings is needed, this return on investment suggests that the wider adoption of such programs could prove beneficial for budgets and productivity as well as health outcomes.

We can characterize the employee wellness programs in the study sample along two dimensions: the method of delivery and the focus of intervention. By far the most frequently used method of delivery is the health risk assessment—a survey that gathers baseline self-reported

health data from the employee, which are in turn used by the employer to tailor the subsequent intervention. The health risk assessment is used in 80% of the studies in our sample. Assessments are commonly used in conjunction with a clinical screening of risk factors, including blood pressure, cholesterol, and body mass index (BMI).

The second most common wellness intervention mech- anism was the provision of self-help education materials, individual counseling with health care professionals, or onsite group activities led by trained personnel. In our sample, about 40% of studies included the use of self-help materials; 40% offered individual counseling; and 35% featured on-site group activities, classes, or seminars. Most programs offered a combination of these interventions.

The use of incentives to motivate participation was seen in 30% of programs. Incentives were most commonly

4

MEDICAL BENEFITS

4

bonuses and reimbursements for program participation, but they also included the payback of down payments prior to participation.

The most common foci of the programs were obesity and smoking, the two top causes of preventable death in the United States. More than 60% of the programs explicitly focused on weight loss and fitness. All but three of the remaining programs focused on either multiple risks or risks specific to the participant. Half of the programs focused on smoking, often in conjunction with obesity. Seventy-five percent of programs focused on more than one risk factor, including stress manage- ment, back care, nutrition, alcohol consumption, blood pressure, and preventive care, in addition to smoking and obesity.

Twenty-two studies reported on the impact of well- ness programs on employee health care costs. The aver- age sample size of intervention groups exceeded 3,000 employees.

The 22 studies that examined employee absenteeism had, on average, smaller treatment groups and slightly larger comparison groups compared with those that did not, although the size is generally similar. These studies were carried out for only two years on average, compared to three for health care cost studies. We monetized absen- tee days using the average hourly wage rate in 2009 of $20.49. The average program savings across the studies was a more modest $294 per employee per year, while program costs were $132 per employee per year. Twelve of these 22 studies reported program costs. As with the studies on medical costs, the average savings was rela- tively similar in the subset of studies with rigorous control groups. Among the nine studies with random control groups or matched comparison groups, the average num- ber of absentee days saved was 1.7 per employee per year, estimated to cost $274 per employee per year. The next 11 studies had average program savings of 1.9 absentee days or roughly $309 per employee per year.

Our review of the evidence suggests that large employ- ers adopting wellness programs see substantial positive returns, even within the first few years after adoption. Medical costs fall about $3.27 for every dollar spent on wellness programs, and absentee day costs fall by about $2.73 for every dollar spent. Although these benefits surely accrue in part to the employee, it is also likely that they accrue in part to the employer—in the form of either lower replacement costs for absent workers or an advan- tage in attracting workers to the firm.” MB

Health Affairs Web Exclusives are available free to subscribers and on a pay-per-view basis for nonsubscribers. You may purchase access to this article for 24 hours for the price of $12.95, prepaid. Web site: http://content.healthaffairs.org/cgi/content/abstract/hlthaff.2009.0626

Annual Report to the Nation on the Status of Cancer, 1975–2006

Featuring Colorectal Cancer Trends

and Impact of Interventions to Reduce

Future Rates

Brenda K. Edwards et al., Cancer, December 2009

“Rates of new diagnoses and rates of death from all cancers combined declined significantly in the

most recent time period for men and women overall and for most racial and ethnic populations in the United States.

The drops are driven largely by declines in rates of new cases and rates of death for the three most common can- cers in men (lung, prostate, and colorectal cancers) and for two of the three leading cancers in women (breast and colorectal cancer). New diagnoses for all types of cancer combined in the United States decreased, on average, almost 1% per year from 1999 to 2006. Cancer deaths decreased 1.6% per year from 2001 to 2006.

Overall cancer rates continue to be higher for men than for women, but men experienced the greatest declines in incidence (new cases) and mortality (death) rates. For colorectal cancer, the third most frequently diagnosed cancer in both men and women, and the second leading cause of cancer deaths in the United States, overall rates are declining, but increasing incidence in men and women under 50 years of age is of concern.

In men, incidence rates have declined for cancers of the prostate, lung, oral cavity, stomach, brain, colon, and rectum, but continue to rise for kidney/renal, liver, and esophageal cancer, as well as for leukemia, myeloma, and melanoma. In women, incidence rates decreased for breast, colorectal, uterine, ovarian, cervical, and oral cav- ity cancers, but increased for lung, thyroid, pancreatic, bladder, and kidney cancers, as well as for non-Hodgkin lymphoma, melanoma, and leukemia.

Among racial/ethnic groups, cancer death rates were highest in black men and women and lowest in Asian/ Pacific Islander men and women. Although trends in death rates by race/ ethnicity were similar for most can- cer sites, death rates from pancreatic cancer, the fourth most common cause of cancer death in the United States, increased among white men and women but decreased among black men and women.

The three leading causes of cancer death for all men, with the exception of Asian/Pacific Islanders, were lung,

Copyright of Medical Benefits is the property of Aspen Publishers Inc. and its content may not be copied or

emailed to multiple sites or posted to a listserv without the copyright holder's express written permission.

However, users may print, download, or email articles for individual use.

Dow Scott, Ph.D., Loyola University Tom McMullen, Hay Group

WorldatWork June 2010

The Impact of Rewards Programs on

Employee Engagement

re se

ar ch

©2010 WorldatWork Any laws, regulations or other legal requirements noted in this publication are, to the best of the publisher’s knowledge, accurate and current as of this report’s publishing date. WorldatWork is providing this information with the understanding that WorldatWork is not engaged, directly or by implication, in rendering legal, accounting or other related professional services. You are urged to consult with an attorney, accountant or other qualified professional concerning your own specific situation and any questions that you may have related to that.

No portion of this publication may be reproduced in any form without express written permission from WorldatWork.

Media Contact:

Marcia Rhodes

14040 N. Northsight Blvd.

Scottsdale, Arizona USA

85260-3601

480-304-6885

Toll free: 877-951-9191

Fax: 480-483-8352

[email protected]

WorldatWork Survey of Rewards and Employee Engagement

1

The Impact of Rewards Programs on Employee Engagement June 2010 Dow Scott, Loyola University Chicago Tom McMullen, Hay Group Mark Royal, Hay Group Mel Stark, Hay Group WorldatWork INTRODUCTION In response to the economic crisis, employers are concerned about keeping employees engaged after they have suffered through wage freezes, lost bonuses, increased work demands and downsizing. Motivating employees under these circumstances while recognizing that once the economy improves top talent may leave for other opportunities has created a new corporate battle cry: employee engagement. Although a variety of definitions can be found, employee engagement is typically described as a high level of employee involvement, commitment to the organization and job satisfaction. Engaged employees value, enjoy and have pride in their work. They are more willing to help each other and the organization succeed; take additional responsibility; invest more effort in their jobs; share information with other employees; and remain with the organization than employees who are less engaged (Lazear 1989; LePine, Erez and Johnson 2002; Riketta 2002, 2008). Finally, employee engagement and related variables, such as commitment and cooperation, have been found to be associated with organization performance (Harter, Schmidt and Killham 2003; Macey and Schneider 2008; Schneider, Macey, Barbera and Young 2009) Although the primary focus of engagement efforts has mostly been on team-building programs, employee opinion surveys and nonfinancial rewards, egalitarian pay structures have been found to be related to employee cooperation, involvement, satisfaction and commitment (Bloom and Michael 2002; Levine1991; and Pfeffer and Langton 1999), all of which have been used as proxies for employee engagement. However, these studies do not examine specific pay practices used by compensation professionals or attempt to relate pay programs specifically to employee engagement. The authors’ survey explores this gap and determines how total rewards programs and employee engagement are related. It also helps determine whether total rewards programs are associated with organization performance by focusing on the following:

• Which reward policies and practices are associated with employee engagement? • Does involvement in the development of pay programs enhance employee engagement? • Is employee engagement associated with organization performance?

METHODOLOGY A sample of 6,300 WorldatWork members, primarily total rewards professionals, was invited to participate in The Impact of Rewards Programs on Employee Engagement study. The survey was open from Dec. 15, 2009 through Jan. 12, 2010. A reminder to complete the survey was e- mailed half way through the survey period and again just before the survey closed. The survey required approximately 15 minutes to complete. There were 736 WorldatWork member respondents from around the world; the 12% response rate is considered good for a survey of this type. As shown in Figures 1 and 2, respondent demographics indicated a diverse sample that represented small to large companies from many different industries. However, the diversity of respondents from other countries was limited, and the breakdown mirrored the WorldatWork membership proportions of the countries represented. The majority of respondents represented organizations from the United States (55%). Canada and Western Europe had the next largest representation at 7% and 4%, respectively. There were few respondents from the United Kingdom, Eastern Europe, Asia-Pacific and the Middle East. And several respondents did not specify a country. Participating organizations were fairly evenly distributed by size. Approximately 19% of organizations had less than 1,000 employees; 20% had between 1,000 and less than 5,000 employees; 18% had between 5,000 and less than 20,000 employees, 14% had 20,000 employees or more.

Figure 1: Survey Respondents by Organization Size (Number of Employees)

Less than  1,000 19%

1,000 to  4,999 20%

5,000 to  19,999 18%

20,000 or  more 14%

Not coded 29%

Figure 2 shows a diverse range of industries represented by the respondents. The largest representation was from professional, scientific and technical services (17%), followed by finance and insurance (10%), manufacturing (10%), and health care and social assistance (7%).

Figure 2: Survey Respondents by Industry

The research findings are presented in Tables 1 through 5, which group the statements to which participants responded into variables. This grouping was based on similarity of content and analyses indicating that the compensation professionals responded to the statements in a similar way. Each table reports the individual statement that made up the variable, the mean (average score) and the percentage of compensation professionals that responded to each answer choice. Factor and coefficient alpha analyses were used to determine the degree to which the statements that make up the variable were related (Questions related to these analyses can be directed to authors Royal and Scott.) Each table also presents mean (average score) for the variable, standard deviation and the coefficient alpha. A coefficient alpha score above .7 indicates a strong relationship among the statements. In other words, respondents who either agreed or did not agree with one statement tended to respond in a similar manner to the other statements defined by the variable. Table 6 shows a correlation matrix based on variables listed in Tables 1 through 5 and some individual statements to which the compensation professionals responded. Table 6 also reports the descriptive name of the variable or individual statement. These statements are numbered so the correlation between variables can be identified in subsequent columns. In the diagonal, the scores in parentheses are the coefficient alpha scores indicating how related the statements were which made up the variable for the correlation matrix (also shown in Tables 1 through 5). The statements in the variables can be found in Tables 1 through 5. Of course, the correlations for individual statements do not have a coefficient alpha score. Note that all correlation scores over .10 are significant.

Finance &  Insurance

10% Health Care & 

Social  Assistance

7% Manufacturing

10%

Professional,  Scientific &  Technical  Services 17%Other

27%

Not coded 29%

FINDINGS Findings are presented in the following sections and in their respective tables:

• Encouraging Employee Engagement with Total Reward Policies and Programs • Degree of Employee Engagement • Impact of Total Rewards-Driven Employee Engagement Programs on Organization Performance • Employee and Supervisor Involvement in the Development of Pay Programs.

Encouraging Employee Engagement with Total Reward Policies and Programs As shown in Table 1, the extent to which organizations used methods to specifically engage employees varied considerably. For example, 44% of the organizations indicated that they explicitly included employee engagement in their organization strategy, whereas 31% said they did not. Seventeen percent were equivocal saying they neither agreed nor disagreed with the statement. However, 60% of the respondents indicated that they used variable pay to reward employee engagement; based on the authors’ experience, this seems high. Given its seeming popularity in the literature and press, it is surprising how few organizations have taken even basic steps to encourage employee engagement. As shown in Table 1, the respondents “strongly agreed” or “agreed” that:

• “Engagement levels fostered by line managers are an important factor in evaluating their performance,” (37%)

• “Employee engagement performance metrics are incorporated into variable pay programs in our organization,” (60%)

• “Our organization has a specific definition of ‘employee engagement’,” (53%)

• “Employee engagement is explicitly included in our organization strategy,” (44%).

The .80 coefficient alpha score indicates that organizations that take any one of these actions are likely to take the other actions as well to encourage employee engagement. By the same token, those that do not take one of these actions do not take other actions to encourage engagement. Furthermore, as shown in the correlation matrix reported in Table 6, organizations that follow these practices are more likely to indicate that their total rewards strategies are effectively engaging employees (r= .47); are more effective in fostering high levels of employee engagement and motivation (r = .47); and are confident that they will be able to retain key talent as the economy improves (r = .38). Literature and management consultants recommend employee opinion surveys as an effective way to obtain feedback and engage employees. Unlike the other methods for engaging employees identified above, most organizations periodically conduct an employee attitude survey. Although few organizations conduct employee opinion surveys multiple times a year (6%), most conduct surveys each year (35%) or every other year(24%.) Only 20% of respondents indicated that their organization did not use employee opinion surveys. Most respondents (60%) said that their employee opinion surveys were effective or very effective at generating action and change; while only 15% said they were ineffective. This finding indicates that management is listening and using employee input to take action. The frequency with which employers conduct employee opinion surveys is associated with the effective engagement of employees via total rewards strategies (r = .20); organization effectiveness in fostering high levels of employee engagement and motivation (r = .22); and confidence that the

organization will be able to retain key talent as the economy improves (r = .15). However, the correlation scores were much higher for those organizations that took action and made changes as a result of the input received from the employee opinion survey, i.e., effective engagement of employees via total rewards strategies (r = .46); organization effectiveness in fostering high levels of employee engagement and motivation (r = .54); and confidence that the organization will be able to retain key talent as the economy improves (r = .35). (See Table 6). Respondents were asked to reveal which specific total rewards-related programs might have an impact on employee engagement. These rewards were placed in four categories which are reported in Tables 2a through 2d. As shown in Table 2a, more than 40% of the respondents believe that base salary, base salary increases, and benefits and perquisites have a “high” or “very high” impact on employee engagement. Furthermore, respondents, as shown in Table 2b, believe that short-term incentives or bonuses have an even higher impact on engagement (54%). However, substantially fewer believe that long-term incentives and financial recognition have a high impact on engagement — 32% and 32%, respectively. Table 2C shows that the impact of intangible rewards on employee engagement is perceived as very high with work environment or organization climate rated at 61%; work-life balance rated at 55%; the nature of the job or quality of work rated at 69%; and career development opportunities rated at 59%. Only, nonfinancial total rewards programs receive a relatively low score at 37%, which is interesting given that nonfinancial recognition programs are often suggested as ways to motivate and engage employees. Finally, leadership scored relatively highly in terms of its impact on employee engagement as shown in Table 2d; managers’ assessment of employee performance (49%), coaching (53%) quality of senior leadership (65%) and organizational goals and objectives (55%). Degree of Employee Engagement Compensation professionals were asked to indicate the level of employee engagement in their organization. When asked “How effective is your organization in fostering high levels of employee engagement and motivation,” 42% of the respondents indicated that they were “effective or very effective,” 39% said they were “neither ineffective nor effective,” and 19% said that they were “very ineffective or ineffective.” An indirect measure of engagement is retention of talent. More than half of the respondents, 53%, felt they could “retain key talent as the economic outlook improves.” Impact of Total Rewards-Driven Employee Engagement Programs on Organization Performance Forty-two percent of the respondents indicated that their organization’s total rewards strategies had a positive effect on employee engagement, whereas 24% did not think this was the case. WorldatWork members were asked to assess how their efforts to engage employees through total rewards programs affected a variety of employee and business outcomes. These assessments were grouped into three categories, which are reported in Tables 3a through 3c. Table 3a shows that 22% to 24% of respondents either agreed or strongly agreed that the efforts to engage employees through total rewards programs had reduced employee complaints about pay fairness and equity, reduced turnover, reduced absenteeism and reduced employee problems. However, a larger proportion of respondents disagreed or strongly disagreed that total rewards programs reduced complaints about pay fairness and equity (36%) and reduced turnover (39%). Approximately an equal number “disagreed” that efforts to engage employees through total rewards programs reduced absenteeism (22%) and reduced employee performance problems (26%).

Table 3b shows the impact of efforts to engage employees through rewards programs and the effect these efforts had on organizational competitiveness, relationships with customers, financial performance and innovation. There was substantially more disagreement with these statements than agreement. These findings were consistent with the impact of efforts to engage employees through total rewards programs and the impact they had on a positive work environment, better collaboration and relationships with employees, which is shown in Table 3c. What was most interesting about these measures of impact of efforts to increase engagement through rewards programs is that they were strongly correlated with the organizations’ effectiveness in fostering high levels of employee engagement and motivation. This indicates that organizations which can link engagement to total rewards practices are more likely to effectively engage and motivate employees. (See Table 6). Employee and Supervisor Involvement in the Development of Pay Programs Encouraging employee input and involvement in programs which affect them is a method that organizational development specialists suggest, and managers often use this to enhance employee engagement and commitment. Overall, the survey shows that employees have limited involvement in design, implementation or evaluation of pay programs. (See Table 4). More specifically, only 11% of the respondents indicated that their organization frequently (defined as often or always) involved employees in the design of total rewards programs. Twenty percent said that employees participated in meetings soliciting their feedback and 26% of the organization solicited employee input through surveys. In 19% of organizations, employees were frequently involved in implementing or communicating information about the existing program, 22% participated in meetings soliciting their feedback and 24% responded to opinion surveys. Respondents reported that fewer employees were involved in assessing or evaluating the total rewards programs (17%) in their organizations. In 21% of the organizations, employees were frequently asked for feedback at meetings and 25% through employee opinion surveys. What is more telling is that organizations that involve employees in the design, implementation and assessment of total rewards programs are associated with rewards strategies that effectively engage employees (r = .38, r = .39, r = .38, respectively); organization effectiveness in fostering high levels of employee engagement and motivation (r = .31, r = .27, r = .39, respectively); and confidence that they can retain key talent when the economy improves (r = .26, r = .21 and r = .27, respectively). (See Table 6). According to the survey results, supervisors and managers are more likely to be involved in the design, implementation and assessment or evaluation of total rewards programs than employees, as shown in Table 5. This was especially true when it involved being a member of the design team. Supervisors and managers are often or always involved in the design of total rewards programs by participating in design teams (32%), participating in meetings soliciting feedback (45%) and participating in surveys soliciting input (33%). Supervisors and managers were substantially more involved in the implementation of total rewards programs than employees covered by the total rewards programs, such as participating in design teams (55%), participating in meetings soliciting feedback (48%) and participating in surveys soliciting input (36%). Finally, supervisors and managers were substantially more involved in the evaluations or assessments of total rewards programs than employees. Supervisors and managers often or always participate in the design teams (37%) and many often or always participate in meetings soliciting feedback (41%). Howe

Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.