Tommy Thompson: Health-care costs hurting business

Posted: June 18, 2008

The emphasis was on wellness as health-care leaders discussed what's ailing America's medical system yesterday in Philadelphia.

While there was a nod to the 47 million people without insurance, most of the talk at a meeting organized by the Greater Philadelphia Chamber of Commerce focused on the cost benefits of preventing chronic illness, which accounts for the bulk of health-care spending.

Tommy Thompson, the former Wisconsin governor who was secretary of Health and Human Services during President Bush's first term and was a Republican candidate for president, was the featured speaker on a slate that also included state leaders and business officials.

Thompson, now the independent chairman of the Deloitte Center for Health Solutions, said companies that did business internationally had a selfish reason to get costs under control; this country's higher health-care expenses put them at a competitive disadvantage.

Employee health care adds $1,725 to the cost of every General Motors car, he said, a price he thinks has helped Toyota gain market share.

"If you are in a business that sells internationally, watch out," he said. "Your business is going to be taken away from you."

Because health costs are hurting businesses and because Medicare is approaching bankruptcy, he said the new president and Congress will have do something next year. It will help to promote electronic medical records and prescriptions, he said, as well as to create tax incentives and buying pools to make insurance more affordable for low-income people.

But he and other speakers said big savings could also come from the 20 percent of us who have chronic illnesses. That group accounts for 80 percent of health-care spending. The key is prevention and better management of diseases that often are exacerbated by lifestyle choices such as smoking, overeating and underexercising.

Thompson, who said he had snatched cigarettes away from employees, said companies should ban smoking and encourage better eating. He suggested subsidizing healthy foods in the company cafeteria and charging "five bucks for a hamburger, 10 bucks for a cheeseburger and 20 cents for a French fry."

Thompson, who was also scheduled to talk with former Democratic Sen. Tom Daschle about the presidential candidates' positions at the National Constitution Center last night, characterized the Democratic proposal as "more government control" and the Republican position as more free enterprise. "I don't think the Republicans are doing enough," he said. "And I think the Democrats are doing too much."

Marlene Henkin, special assistant to the secretary of the Pennsylvania Health Department, said workplace wellness programs could reduce workplace health costs 25 percent, even more if you factor in the impact on disability and presenteeism.

Targeting smokers and obese employees can have a particularly big payoff. Smokers, she said, miss an average of 6.5 more days of work a year than nonsmokers and spend 8 percent of their working hours on "smoking rituals." Overall, they cost $10,000 more a year in absenteeism and medical expenses than nonsmokers.

Average medical costs are $1,244 higher for obese employees than for those of normal weight, she said.

"Medical high-risk employees," she said, "are medical high-cost employees."


Contact staff writer Stacey Burling at 215-854-4944 or sburling@phillynews.com.

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