We recently shared a new (actually updated) white paper that we published initially in 2004 and wanted to share it in brief on our blog(s) so that those who did not get the opportunity to see the full paper can be made aware of it and access it if so desired.
For those who are subscribers to Diversity HealthWorks your copy is free. If you have not received a copy, please send me a message through the network.
If you are interested in receiving a complimentary copy of the white paper: Join Diversity HealthWorks or if you would like to purchase a copy please click the link below:
The first few pages are included below for your review. If you have questions, always feel free to contact me, Amri Johnson. You can find our contact info at our website.
Diversity, Disease Management, and the Business Case for Addressing Disparities in Healthcare
The conversation about differences in health outcomes for minorities and whites in the U.S. has been documented in the academic literature, in detail, for many years (U.S. Department of Health and Human Services (DHHS), 1985). Nonetheless, the past 10 years has significantly increased and framed the conversation about differences into the issue of “health disparities”.
Prior to the release of Healthy People 2010, which focused on decreasing (towards eliminating) the differences in racial and ethnic health outcomes, the dialogue was understood and often studied by researchers in the academy; however, mainstream America did not have clarity on the degree of the problem and how to address it. With Healthy People 2010, then Surgeon General David Satcher introduced the term “Health Disparities”.
The introduction of this term allowed for a broader dialogue about the direct and indirect impact of health disparities on multiple players in the health care system. It also created further inquiry as to the causes. In 2002, the Institute of Medicine released its publication Unequal Treatment: Confronting Racial and Ethnic Disparities in Health Care that documented the various reasons for disparities as well as offered suggestions on how to address them.
Unequal Treatment was groundbreaking because it opened the discussion up to a more mainstream audience. However, the opening was not exhaustive enough that it could frame the issue in a way that was seen outside of health circles as a bottom line issue that affected all U.S. residents.
As most Americans are aware, the demographics of the country are rapidly changing. For example:
• Currently one-third of Americans are racial and/or ethnic minorities
• By 2020 the Bureau of Census states that over 40% of the U.S. population
will be racial/ethnic minorities
• In the next decade 41.5% of workforce will be racial and ethnic minority
(Bureau of Labor Statistics)
• Over 50% of all U.S. immigrants entered the country since 1990
These statistics translate into a greater necessity to give the issue of health disparities the attention it needs by all who are affected. In particular those affected include: medium and large employers with growing ethnically diverse workforces and taxpayers who pay for the services of the largest employers in the country: federal, state, and local government. As mentioned above health disparities impact all Americans.
By framing disease management, corporate diversity initiatives, and health disparities in a similar context, this paper will illustrate how the business case for addressing each are aligned. In addition it will illustrate how an organization can proactively integrate addressing health disparities into existing practices such as diversity and disease management.
Disease Management and Healthcare Cost
With increasing costs of healthcare, employers (large and smaller), health plans, and healthcare providers have explored and tapped into various methods to address the challenges of managing cost. Myriad programs have been implemented, starting with managed care’s flourishing in the 1970s up to today’s emphasis on Disease Management (DM) which started in the 1990s.
The Disease Management Association Defines disease management as:
A system of coordinated healthcare interventions and communications for populations with conditions in which patient self-care efforts are significant. Disease management:
• supports the physician or practitioner/patient relationship and plan of
• emphasizes prevention of exacerbations and complications utilizing
evidence-based practice guidelines and patient empowerment strategies,
• evaluates clinical, humanistic, and economic outcomes on an on-going basis
with the goal of improving overall health.
While DM is, in theory, indicated as promising where cost savings are concerned, there is very little to no extensive, longitudinal, empirical evidence to indicate sufficiently that such savings are being realized. Al Lewis, Executive Director of the Disease Management Purchasing Consortium and DM ROI expert states, “For the first seven years of the eight year history of DM, nearly every result was tainted by erroneous measurement.” Mr. Lewis has also postulated that understanding ROI for DM is just now starting to gain ground where solid measures and a gold standard are concerned (www.dismgmt.com). Despite sparse empirical evidence supporting DM, DM as an industry has flourished with revenues (primarily paid by health plans) growing from $87 million in 1997 to over $600 million in 2002 with projections of over $1 billion. The Boston Consulting Group has gauged the DM market in 2005 at approximately $1.2 billion. They indicated a 40% compound growth rate of 40% since 1997 similar to the above statistics; and predicted growth to $1.8 billion in 2008. They deduced that the market would reach maturity at around more than $3-4 billion. (“Realizing the Promise of Disease Management Boston Consulting Group 2006)
Corporate Diversity Programs
Corporations have heavily embraced diversity programs over the past 20 plus years. From supplier diversity to employee-focused/workforce diversity programs, most of the Fortune 1000 and many others have specific diversity/inclusion programs being implemented or built into their current HR employee on-boarding/training programs or overall corporate culture.
While most programs were initially developed reactively out of adherence to affirmative action and compliance regulations; currently, many companies are acutely aware of the various positive outcomes and are working proactively to measure diversity’s impact on their corporate bottom line. From employee engagement to measuring ROI through diversity efforts in marketing, recruitment, or other streams of revenue or cost savings, the case for diversity for many has become a part of how business gets done is more and more a mainstream idea for large to medium-sized employers. This emphasis is an evolution as well as a response to some critics that argue against diversity programs being of any bottom line value to an organization. One such critic, Thomas A. Kochan, one of the most respected human resources management scholars in the country from MIT’s Sloan School of Management states, “The business case rhetoric for diversity is simply naïve and overdone. There are no strong positive or negative effects of gender or racial diversity on business performance.” Other arguments are, of course, to the contrary including Luke Visconti, co-founder of Diversity Inc., a leading diversity publication, who states, "It defies gravity and flies in the face of logic," he says. "I can’t even imagine how someone could come up with that conclusion unless there was no diversity among the people doing the study.” In dismissing Kochan’s research, Visconti is stating that anyone who cannot see the value of emphasizing diversity, does not understand the changing demographics of the United States; or, is blind to the anecdotal examples and intangible benefits that companies are experiencing that have yet to be measured empirically.
While these arguments state opinion, more recently authors such as Dr. Scott Page’s book The Difference and Frans Johansson’s The Medici Effect which both suggest that diversity drives better solutions and greater innovation respectively. Many have taken these authors’ research and insights into account as they continue to illustrate how inclusive and diverse work environments are a key to organizational success.
The former comments above have been a part of the diversity industry for a long time, while those of Page and Johansson are more recent. Nonetheless, even though professionals that work in the industry are clear about the need for making diversity a sustainable part of our organizational cultures, we have often seen the commitment by companies to be forsaken. This has especially been the case since the economic recession in 2008-09 has forced corporations to make budget cuts. While diversity is valued, it has still been one of the first places to take budget cuts.
(Interested in receiving a complete copy of this white paper? visit Diversity HealthWorks)
Make it a great day!