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Correction to This Article
A Feb. 20 article on companies offering incentives to keep their employees healthy reported an outdated number for estimates of deaths attributed to poor diet and physical inactivity. Researchers for the Centers for Disease Control and Prevention had estimated 400,000 deaths each year, but they published a clarification in the January issue of the Journal of the American Medical Association changing the figure to 365,000.
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Firms Make It Their Business To Push Health

Ho said his inspiration came from an assessment program the health management company uses to grade physicians' performance. Once doctors were told what they were doing right and what they were doing wrong, there was a marked improvement in patient treatment, he said. Ho theorized that he could apply those lessons to employees and their own health.

PacifiCare officials declined to say how much the company is spending on the program, except to describe the amount in the "high six figures." Ho predicted the program would more than pay for itself over the first two years in health care savings.

Jennifer Horn, chief of staff at PacifiCare Health Systems' corporate health services group, warms up with fellow workers during a company-sponsored yoga class Wednesday at PacifiCare's offices in Cypress, Calif. The company offers financial incentives for healthy living. (Steven Lewis For The Washington Post)

"Everybody knows we have a health care crisis, exemplified by both cost inflation and an obesity epidemic, in the United States. It was only a matter of time before employers started taking action," Ho said.

Health insurance premiums have skyrocketed since 2000, growing 59 percent, far faster than the 12.3 percent rise in average pay, according to the Kaiser Family Foundation, a nonprofit research firm in Menlo Park, Calif. Studies have shown that nonsmokers alone save companies an average of $1,000 a year.

When PacifiCare's health credits program was announced last summer, the reaction from employees ranged from enthusiasm to suspicion. About half the employees signed up, with about 15 percent doing enough to qualify for the $15 biweekly credit.

"Some people said I don't want anybody to know this stuff," said Jennifer Horn, 31, chief of staff of the corporate health services group.

The company assured employees that individually identifiable data would be kept confidential and made available to health professionals only with the employee's permission. There were also complaints from people who reported that some co-workers were cheating, that the person next to them was eating a candy bar or chips and was still getting the credits for healthy eating.

While PacifiCare's program is strictly voluntary and is currently based on the honor system, Ho said the company plans to introduce modifications to make it stricter in the next few years. Parts of the program may become mandatory, and there may be monitoring of reported indicators of health such as weight loss and exercise. Perhaps, he said, the company may conduct weigh-ins, give out pedometers linked to a computer system or issue swipe cards for gyms to record the amount of a time an employee spends there.

"Some of these behaviors like exercising regularly and eating right should be the default. Soon, those that don't do this may have to pay more or risk a penalty," Ho said. "This is the future of health care."

But even voluntary programs worry people such as Mark A. Rothstein, director of the Institute for Bioethics, Health Policy and Law at the University of Louisville School of Medicine. He said lower-paid employees may feel greater pressure to participate.

"I think it's a tax that some of the lower-paid workers perhaps can't afford," Rothstein said.

Under the PacifiCare system, employees earn incentive credits in various ways, whether by using an online diary to log their food and exercise, by participating in one of 16 health education classes or even by maintaining a gym membership. The company's main Southern California campus just outside of Los Angeles is being transformed to match the company's new emphasis on health. Vending machines are being stocked with water and nuts rather than soda and chocolates. Posters encourage people to take the stairs. On-site yoga classes have begun.

Sharon Richard, 62, an executive associate in major accounts whose family has suffered heart attacks and stroke, said she signed up because she had started an exercise program when she turned 60 and wanted a way to continue her progress.

"It's about a lifestyle change and your company supporting you in that," Richard said.

As a first step in signing up, employees fill out a detailed assessment form with their height, weight and family health background. A computer program suggests exercise programs and menus based on a person's background and stated goals. Among the input it might give is that a person's caloric intake leans too much to starches or that the calories are not balanced enough throughout the day.

PacifiCare's program allows employees to consult with dieticians and fitness experts via e-mail. The workers have the choice of allowing these "coaches" to look through their diet and exercise logs, or not.

Graham, who works for the company's dental and vision division, said he had not exercised in years and was becoming increasingly worried by his doctor's warnings to exercise more and eat better. Two of his co-workers have dropped out of the program, but he and another woman have stayed on and are happier for it. Graham has lost 45 pounds, he said, and his "diet partner" 40 pounds.

He said the privacy he has given up is worth the results he has received, especially since the program is voluntary.

"Forcing workers is one thing -- I don't think that's really right," said Graham, a five-year employee who recently turned 46. "But incentivizing, I think it's awesome. Everybody wins. The company wins because they save money on health care premiums, and the employees win because they are in better shape."

He said the interactive nature of the program keeps him on track, monitoring every move like his mother might once have, and giving him unsolicited advice and admonishing messages when he is not fulfilling his goals.

"I feel guilty when I don't do it," Graham said.

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