Creating Wealth Page 15

  Figure 2 shows the expenses paid for healthcare as a share of GDP in OECD countries — our peers. The US stands out as spending almost double the average of all industrialized countries.

  FIGURE 10.2 Per Capita Expenditure on Healthcare as a share of GDP, 2006.

  Source: OECD Health Data 2006.5

  In 2004, more than one million Americans were financially ruined by illness or medical bills. Most were middle class. Each year, two million Americans face the double disaster of illness and bankruptcy. But the bigger surprise is that ¾ of the medically bankrupt had health insurance. Too sick to work, they suddenly lost their jobs. With the jobs went most of their income and their health insurance — ¼ of all employers cancel coverage the day employees leave work because of a disabling illness; another ¼ do so in less than a year.

  Bankrupt families lost more than just assets. One out of five went without food. One third had their utilities shut off, and nearly skipped needed doctor or dentist visits. These families arrived at the bankruptcy courthouse exhausted and emotionally spent, brought low by a medical system that could offer physical cures but that left them financially devastated.

  Without better coverage, millions of more Americans will be hit by medical bankruptcy over the next decade. It will not be limited to the poorly educated, the barely employed or the uninsured. The people financially devastated by a serious illness are at the heart of the middle class. Every 30 seconds in the United States, someone files for bankruptcy in the aftermath of a serious health problem.6

  It is hoped that the healthcare reform passed by the US Congress in 2010 will be able to correct some of these problems. However, we should consider that the jury is still out on this topic, because there are systemic forces at work that this reform has not addressed.

  From Sickness Treatment to Healthcare

  A US Committee on Capitalizing on Social Science and Behavioral Research to Improve the Public’s Health concluded that “Behavioral and social interventions therefore offer great promise to reduce disease morbidity and mortality, but as yet their potential to improve the public’s health has been relatively poorly tapped.”7 Approximately ½ of all causes of mortality in the United States are linked to social and behavioral factors such as smoking, diet, alcohol use, sedentary lifestyle and accidents. However, less than 5% of what is spent annually on healthcare in the United States is devoted to reducing risks posed by these preventable conditions.

  The proof that there is a systemic cause underlying this entire issue can be found in evidence from traditional Chinese medicine. Until the late 19th century, very different monetary incentives were applicable to healthcare in China. A doctor would get paid by a patient as long as he or she was healthy. But the doctor would have to pay the patient whenever the latter was sick. Furthermore, if a patient died while under the care of a doctor, a metallic ball was hung at the entrance of that doctor’s office: a long string of such balls would therefore constitute a clear warning for any new client. With this incentive scheme, is it surprising that traditional Chinese medicine was focusing on preventive measures and healing chronic diseases? Or, that typical Chinese medical interventions such as acupuncture, moxibustion and even herbal treatment are extremely cautious in not generating any negative side effects? This financial enticement explains why preventive medicine is emphasized so much more systematically in traditional Chinese medicine than in the Western approach.

  Studies on employee activity programs reveal that the productivity of the people involved increased by 12%,8 and absenteeism dropped by up to 45%.9 Estimates of the impact of healthcare costs on corporations show a rise from 7% thirty years ago to up to 50% of the corporate profits now. This is why some individual companies are investing in wellness directly. For instance, Johnson & Johnson spends $4.5 million per year on staff wellness programs, avoiding thereby medical costs estimated at $13 million per year. But individual corporate solutions may not be the most effective way to solve the problem.

  Wellness Tokens: Promoting Preventive Care

  What systemic solutions can become available to help shift society as a whole towards more sustainable wellness? Trying to shift the modern Western medical model to simply adopt the ancient Chinese incentive system is unrealistic. But another way is available with a complementary currency that is specifically designed to promote wellness, rather than sickness.

  Today, the conventional Western medical system focuses on four areas:

  • Sickness treatment — treatment of diseases and injuries

  • Emergency care — treatment for acute health problems that carry significant risk of death or imply severe changes in lifestyle

  • Long-term care — treatment for chronic health problems

  • Elder care — treatment for people who have entered a phase of their life when caring for their own health becomes a difficult challenge for them to do alone

  In addition to addressing some of the issues generated in these areas, the framework proposed below would add consideration of three additional domains:

  • Prevention — taking actions to keep health issues from escalating into medical breakdowns or emergencies. This could include medical procedures that might prevent more serious complications in the future, or alternative treatments that use mainly the body’s own energy for healing, like acupuncture and dietary changes.

  • Wellness — taking actions to maintain a healthy body and lifestyle that is less susceptible to many common health problems. This could include personal practices like better diets, daily walks or yoga classes, as well as other healthy habits.

  • Holistic/Optimal Health — taking actions to create a level of health that seems impossible to many today. Imagine practices that would allow 80-year-olds to retain physical activity comparable to today’s active 40-year-olds, or people living well into their 100s. Such results have already been demonstrated by exceptional individuals, and we know enough about the human potential today10 to conclude that there is no reason that such results, if considered desirable, could not become more generalized with the appropriate incentive schemes.

  We know how frequent flyer miles can successfully encourage particular customer behavior patterns, i.e., loyalty to a particular airline alliance. Now imagine a complementary currency — let’s call them Wellness Tokens — that would encourage people to take on healthy habits and practices. For example, one hour of exercise at a gym would earn one Wellness Token; or specific preventive treatments could similarly be encouraged with Wellness Tokens.

  The role played by the airline alliances in issuing and administering frequent flyer miles would be performed by a Wellness Alliance — an association of organizations which have a financial or other interest in promoting healthy behaviors. Such an alliance could include health insurance companies, HMOs, corporations that want to reduce the healthcare cost of their employees and their families and local, state and federal governmental agencies.

  The process starts with a Wellness Alliance issuing Wellness Tokens for two types of activities:

  • Help of a non-medical nature to elderly or handicapped persons who need chronic support, similar to the Fureai Kippu system (and other time currencies) in Japan and the Care Bank in Vermont (e.g., help in shopping, reading to visually disabled people, help with house living conditions). Home care programs typically cost five times less than hospital care systems. See Chapter 11 for more details.

  • Taking an active part in specifically qualified preventive health programs (like voluntary vaccinations; obesity reduction programs; primary, secondary and tertiary prevention; health educational programs). The Return on Investment (ROI) for these activities has been estimated at a striking 300% to 1000%, depending on the program.11

  These tokens could be redeemed in part for other services or goods that further promote health, ranging, for instance, from partial payment for preventive therapies to buying or repairing a bicycle or buying appropriate foods. Another use of the tokens could be in partial payment f
or the insurance premiums, given that participants in this system should have a lower probability of getting or remaining sick. This logic is what justifies the Elderplan Insurance Company in Brooklyn accepting 25% of its health insurance premium for elderly participants in a local Time Bank.12

  There is ample evidence that support groups for encouraging long-term wellness activities (e.g., weight reduction groups, Alcoholics Anonymous, running or gym exercise buddies or simply direct family) are important. Therefore, a Wellness Token system could meet not only the needs of individuals, but also those of groups: a family unit, a group of friends, professional colleagues or other support groups.

  Participants in such a group would agree to a mutual wellness contract, so that the whole group would be affected by the results of each member. For instance, assuming that a group of five people are involved in an obesity reduction program, both the individual and the group weight reduction objectives could be used as a criteria for obtaining Wellness Tokens. In this example, independently verifiable, quantitative results could even be used in a contract with the Wellness Alliance.

  Figure 10.3 shows schematically the flow of Wellness Tokens through economic circuits for prevention programs and home care support systems.

  FIGURE 10.3. A Wellness Token System

  Businesses or care providers could accept Wellness Tokens in partial payment for their services, and the balance in national currency. Each wellness provider would decide the percentage they accept in Wellness Tokens in payment for their services. The amount that they accept in Wellness Tokens could also be modulated to fit their own specific business needs (e.g., some may want to accept a higher percentage in Wellness Tokens during weekdays when they are less busy). Others may want to accept larger percentages if it would attract additional customers or because they have a good use for tokens themselves.

  What can businesses or care providers do themselves with the Wellness Tokens they accept? First of all, the owners or employees of those businesses could use them exactly as anybody else, for their own health improvement. However, a bicycle shop, for instance, may receive more Tokens than it can use personally. That is why businesses accredited by the Wellness Alliance as providing valuable services would have the option to cash in Wellness Tokens in national money, but at a discount calculated to be a win-win between all the parties.13

  Wellness Tokens would help people to become or remain healthier than they otherwise would be, reducing current and future medical costs. The system would create a wider market for goods and services that promote wellness. Even the pharmaceutical industry could benefit by producing more preventive medicine products and services, as it amplifies their market to the 93% of people in the society that are currently healthy. In the cases where governments provide universal healthcare, a Wellness Token system also helps to reduce the pressures on government to go into deficit for healthcare spending.

  For there to be any hope of the adoption of new systems, like Wellness Tokens, where the incentives work to reward wellness instead of sickness, we need to strengthen the industries that are more profitable when people are well. Fortunately, this includes the vast majority of businesses in the country who suffer when people are out of work, or when their insurance premiums increase because of higher risk employees.

  Already, some corporate wellness programs offer incentives to employees who go through a year without taking a sick day — some workplaces offer cash bonuses to workers with a good record. Others introduce weight reduction competitions with prizes for pounds lost, or miles walked or health programs attended. In 2008 over 60% of the companies in the US who have more than 10,000 workers offered wellness programs, up from 47% in 2005.14

  For instance, IBM self-insures its workforce, and spent $1.3 billion on healthcare for its employees, dependents and retirees in 2008. They have been offering financial incentives to employees who participate in wellness activities since 2004, and through the end of 2008 had invested $133 million to date in these incentives. To determine whether or not all this money paid into wellness was a good investment, the company hired the University of Michigan’s Health Management Research Center to analyze their program; the Center found that the wellness programs had saved the company over $80 million in reduced health claims since its inception.15 If that is combined with the reduction in lost productivity that comes with sickness, and sick and disability leave for employees who are out sick, the program clearly offers benefits to the company as a whole.

  In addition to wellness programs, some companies are getting a lot more serious about making employees with unhealthy behaviors pay higher costs for health insurance. PepsiCo, Northwest Airlines, American Financial Group and others charge employees who smoke between $20 and $50 per month surcharge on their health insurance. Gannett, which owns 99 newspapers and 21 TV stations in 41 states, charges their employees who smoke more than $50 per month more for health insurance.16 When PepsiCo increased the health insurance surcharge for smokers in 2008, it also added some additional smoking cessation programs, including nicotine replacement therapy such as patches and gum. “The combination of those two elements led to a tenfold increase in participation and increased the quit rate from 20% to 34% in 2008 over 2007,” said Greg Heaslip, Benefits Vice-president.17

  A wide variety of wellness programs have been around long enough now for their efficacy to be well-researched and documented. Several kinds of incentives have been tested and evaluated, and these too have had sufficient results to understand what works and what doesn’t. The introduction of Wellness Tokens is not an experimental, unknown approach; it is rather a new way to systematize and support what is known to be a very successful approach to increased health, rather than merely the treatment of disease.

  CHAPTER 11

  Honoring Our Elders,

  Caring for Children

  I can think of no better way of redeeming this tragic world

  today than love and laughter. Too many of the young have

  forgotten how to laugh, and too many of the elders have

  forgotten how to love. Would not our lives be lightened if only

  we could all learn to laugh more easily at ourselves

  and to love one another?

  THEODORE HESBURGH

  In traditional cultures, many of which still exist today, children and elders are treasured members of both family and community. The beginning of life and the end of life have a special place, as do those closest to these sacred rites of passage.

  Throughout most of human history, childlessness has been a serious hardship. The biblical story of the long-childless Abraham and Sarah, who finally conceived a child well into their ninth decade, is celebrated across three of the world’s major religions: Judaism, Christianity and Islam. These two citizens of Ur, an ancient city,1 received God’s miracle in the form of a child, Isaac, who later became the father of a royal lineage, that of King David, King Solomon and eventually of Jesus of Nazareth himself, whose birth is also considered miraculous by the majority of Christians. Abraham’s other son, Ishmael (whose mother was Hagar), is believed to be the shared ancestor of the Arab people, and even possibly of Muhammad himself.

  Elders play a critically important role in most traditional communities. They are wise ones, the mediators of conflict, the healers, the teachers, the spiritual leaders. Yet now, in the 21st century, they are relegated to the sidelines, discredited “senior citizens,” a term which devalues the idea of an elder. The facilities and programs created for them focus on keeping them entertained rather than keeping them engaged. Modern society has created leisure time for elders, with social security, pensions and retirement programs which give them the potential to make enormous contributions to our communities. Unfortunately, deteriorating health, isolation and the culture of youth, with its inherent disparagement of older people, robs society of the values that elders offer.

  We need child care and care for our elders in abundance. Yet, childcare workers and elder-care workers are amo
ng the lowest paid workers in our society. As a result, the quality of the care is also quite low, since these professions do not attract people who are educated and who have the ability to do other things at higher wages.

  In the United States, there were more than 90 million people over the age of 60 in 2008, close to of the country’s population. More than ½ of these people require some level of care, and one in ten jobs are generated in this area. According to US Census data, in 2005 there were 11 million children under the age of five. Anyone who has had to care for a young child knows that at this age, the optimal ratio for attention is 1:1. So, ideally there would be 11 million people engaged in this level of child care. Yet in 2005, 21% of the children under five in the US were cared for by their parents, 25% by their grandparents, 23% in a daycare facility, 15% in what is described as “non-relative care,” and fully 13% with “no regular arrangement.” The number of child-care workers in the US is hard to determine with any accuracy, because the census number (456,232 in 2002) doesn’t include self-employed daycare providers, pre-school teachers, teacher assistants and all the parents and grandparents i.e., the majority of the people who are actually doing this work today. The mean hourly wage for those who were counted in 2002 was $8.32, just over minimum wage in most states. The mean hourly wage for elder-care workers in the same year was a bit higher, ranging somewhere between $9.45 per hour and $10.25, depending on the level of skills required.2

  The low wages and lack of quality care for the people who traditionally were the most important members of our community is one important way we neglect them — it is nothing less than economic abandonment. The ramifications of this neglect are staggering — the statistics describing child and elder abuse in the US are truly a national tragedy, as the weakest members of our society take the brunt of our dysfunctional economy. Studies done on a national level indicate that between one and two million people over the age of 65 have been injured, exploited or otherwise mistreated by someone on whom they depended for care or protection.3 Every year, there are over three million reports of child abuse — one report every ten seconds. In 2003, there were 906,000 convictions of people who abused children in the US. Four children die every day as a result of neglect and abuse, with three out of four of these victims under the age of four.4