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The Financial Impact of Changes in Personal Health Practices

Edington, Dee W. PhD; Yen, Louis Tze-ching PhD; Witting, Pamela MA, MSW

Journal of Occupational & Environmental Medicine: November 1997 - Volume 39 - Issue 11 - p 1037-1046
Original Article

The impact of changes in health practices on medical claims costs between 1985-1987 and 1988-1990 was examined among 796 employees. Employees completed a health risk appraisal in 1985 and 1988 and were categorized into health risk levels. High-cost status and high-risk status were significantly associated at both times. The percentage of employees with high-risk status decreased from 31.8% to 25.3% between 1985 and 1988 (P < 0.01). Changes in average costs and the percentage with high-cost status followed the risk change. The largest increase in average costs occurred in employees who moved from low-risk to high-risk status. The greatest reduction in average costs occurred in employees who moved from high-risk to low-risk status. Median costs were not as sensitive to risk change. The findings provide strong evidence that improving individual health status is associated with financial benefits.

From the Health Management Research Center (Dr Edington, Dr Yen) and Division of Kinesiology (Dr Edington), The University of Michigan, Ann Arbor, Mich., and Coors Brewing Company (Ms Witting), Golden, Colo.

Address correspondence to: Dee W. Edington, PhD, Director, Health Management Research Center, The University of Michigan, 1027 E. Huron St., Ann Arbor, MI 48104-1688.

© Williams & Wilkins 1997. All Rights Reserved.