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The 3-Year Disease Management Effect: Understanding the Positive Return on Investment

Nyman, John A. PhD; Jeffery, Molly Moore MPP; Abraham, Jean M. PhD; Jutkowitz, Eric BA; Dowd, Bryan E. PhD

Journal of Occupational and Environmental Medicine: November 2013 - Volume 55 - Issue 11 - p 1356–1364
doi: 10.1097/JOM.0b013e3182a4fffe
Original Articles

Objective: Conventional wisdom suggests that health promotion programs yield a positive return on investment (ROI) in year 3. In the case of the University of Minnesota's program, a positive ROI was achieved in the third year, but it was due entirely to the effectiveness of the disease management (DM) program. The objective of this study is to investigate why.

Methods: Differences-in-differences regression equations were estimated to determine the effect of DM participation on spending (overall and service specific), hospitalizations, and avoidable hospitalizations.

Results: Disease management participation reduced expenditures overall, and especially in the third year for employees, and reduced hospitalizations and avoidable hospitalizations.

Conclusions: The positive ROI at Minnesota was due to increased effectiveness of DM in the third year (mostly due to fewer hospitalizations) but also to the simple durability of the average DM effect.

From the Division of Health Policy and Management, School of Public Health, University of Minnesota, Minneapolis.

Address correspondence to: John A. Nyman, PhD, Division of Health Policy and management, School of Public Health, University of Minnesota, Minneapolis, 15-219 Philips Wangensteen Building, 420 Delaware Street SE, MMC 729 Minneapolis, MN 55455 (

This study was funded by Employee Benefits, Office of the Vice President for Human Resources, University of Minnesota.

This study is part of a series of analyses that were reviewed for human subjects content by the University of Minnesota's institutional review board as application number 08805E32782 and found to be exempt From review under guidelines 45 CFR Part 46.101(b) category 4, existing data; records review; pathological specimens.

None of the authors have any financial, consultant, institutional, or other relationships that might lead to bias or conflict of interest with respect to this study.

Copyright © 2013 by the American College of Occupational and Environmental Medicine