INCENTIVISING HEALTHY BEHAVIOUR Presenting to: IPPR Date: 4 May 2006 Shaun Matisonn CEO, PruHealth
OVERVIEW 1. Public Health Background 2. Improving Health 3. The PruHealth Approach 4. PruHealth Evidence 5. Conclusions The aim of this presentation is to provide information, not advice. PruHealth is a trading name of Prudential Health Limited which is registered in England and Wales. Registered office at Laurence Pountney Hill, London, EC4R 0HH. Authorised and regulated by the Financial Services Authority. 2
PUBLIC HEALTH BACKGROUND The impact of avoidable disease
PUBLIC HEALTH BACKGROUND - CHRONIC DISEASE Projected main causes of burden of disease (DALYs) by World Bank Income group, all ages, 2005 Age-standardized DALYs 100 000 Low income Lower middle income Upper middle income High income World World Bank income group Communicable diseases, maternal and perinatal conditions, and nutritional deficiencies Chronic diseases Injuries Source: WHO (2005) Preventing Chronic Disease: A Vital Investment 4
PUBLIC HEALTH BACKGROUND - IMPACT OF LIFESTYLE PROBABILITY OF 15 YEAR SURVIVAL WITHOUT CORONARY ARTERY DISEASE, STROKE OR DIABETES Source: Lifestyle and 15-year survival free of heart attack, stroke, and diabetes in middle-aged British men. Archives of Internal Medicine (1998), SG Wannamethee et al. 5
PUBLIC HEALTH BACKGROUND - INCREMENTAL BEHAVIOUR CHANGE Small changes can make a big difference - Evidence from EPIC, University of Cambridge: Low levels of activity vs. complete inactivity can increase longevity by about three years Salt reductions of less than a teaspoon a day can halve a person s chances of getting high blood pressure 50g extra vitamin C - roughly an apple a day - can cut the risk of dying early from any cause by 20% 6
PUBLIC HEALTH BACKGROUND - AWARENESS OF HEALTH ISSUES Please indicate how much you agree or disagree with each of the statements that I read out. Firstly...Every day I am concerned about keeping fit and healthy 100% 90% 1986 2004 80% 70% 60% 50% 40% 30% 20% 10% 0% Total Male Female 16-24 25-34 35-44 45-54 55-64 65+ Source: 'Changing Lives'/'Changing Lives in Europe', nvision/taylor Nelson Sofres, 2004 Base: 1000-2000 adults 16+, UK 7
PUBLIC HEALTH BACKGROUND - EMPLOYER PROVISION OF HEALTH-RELATED SERVICES Provision of corporate health services PMI Workstation audits EAP On-site occupational health Health screening 2004 2003 On-site GP 0% 10% 20% 30% 40% 50% 60% 70% % of employers surveyed Source: Employee Benefits - Healthcare Research 2004 Base: 2004 (320 employers) 2003 (381 employers) 8
PUBLIC HEALTH BACKGROUND - AVAILABILITY OF FACILITIES Barriers to exercise I find it difficult to motivate myself 48.8% I do not have time because of work commitments I do not have time because of family commitments Cost prohibits doing more exercise 33.9% 26.7% 30.0% 22.0% 24.4% 39.3% I am not physically able to do exercise I do not have anybody to exercise with Lack of convenient exercise facilities/ area to exercise I do not have time because of social commitments 8.2% 16.3% 17.5% 15.3% 16.9% 12.7% 13.6% 12.2% Cost of equipment prohibits doing more exercise There are no planned activities that I can join Sports related injury Other 6.9% 4.1% 4.5% 3.7% 6.4% 9.9% Why don't you do as much exercise as you think you should? Why don't you do as exercise as you would like Source: Deloitte Health of the Nation Report, 2006 9
PUBLIC HEALTH BACKGROUND The problem of avoidable illness is recognised and relatively well understood The required change in behaviour is clear, and need not be fundamental - incremental changes can have a significant impact Many individuals have the right knowledge and intentions Employers are starting to invest more in health and wellness Most people have access to the right facilities So why does it appear so difficult to change behaviour? 10
IMPROVING HEALTH Lessons from Economics and Psychology
IMPROVING HEALTH The Health Action Model Adapted from Health Promotion: Planning and Strategies, Tones and Green, 2004 Knowledge Skills Environment Personality Social norms Motivation Intention Healthy behaviour Beliefs Relapse Confirmation 12
IMPROVING HEALTH - BELIEFS Belief in personal susceptibility to a negative event It can happen to me Belief that the recommended measure will not entail too heavy a cost I don t have to sacrifice much to do that Adapted from Health Promotion: Planning and Strategies, Tones and Green, 2004 13
IMPROVING HEALTH - BELIEFS Over-optimism US gym study: people on contracts ended up paying an average of $17 per visit, even when a $10 per visit rate was available Choice of 10 in 30 days or 11 in 31 days: people wait for 11. Focus on the present Choice of 10 today or 11 tomorrow: some will take 10 today. Conclusion: we are happy to wait for delayed gratification... but not this month 14
IMPROVING HEALTH - BELIEFS Over-optimism People underestimate the risk of an unhealthy lifestyle now...... and tend to overestimate their ability to improve in future Focus on the present People place more value on immediate pleasures than on future health issues 15
IMPROVING HEALTH - SAMPLE OF THE EVIDENCE Cross-sectional studies confirm that information is an important determinant of demand for health-related goods (eg. Viscusi (1990), Journal of Political Economy) Advice from doctors can have a substantial and significant impact on behaviour (eg. for smoking, Kottke (1998), JAMA) People tend to underestimate their own health risks relative to those they think others face (eg. on smoking see Schoenbaum (1997), American Journal of Public Health) Almost a quarter of UK adults claim that cost prohibits them from doing as much exercise as they would like (Deloitte, 2006) US data: the price of junk food can account for 12% of the deteriorating trend in weight outcomes from 1984 to 1999 (Chou et al (2004), Journal of Health Economics) Although used infrequently, financial incentives used in conjunction with other health promotion techniques are often the most effective interventions (Weingarten et al (2002), BMJ) 16
PRUHEALTH APPROACH Consumer engaged healthcare
THE PRUHEALTH PRODUCT 18
THE PRUHEALTH PRODUCT REMOVING BARRIERS PRICE BARRIERS TO HEALTH AND FITNESS CLUBS Most you would be willing to pay per month for a gym membership Source: Research commissioned by PruHealth from Market Measures, May 2004 19
THE PRUHEALTH PRODUCT 20
THE PRUHEALTH PRODUCT MAKE IT EASIER TO LIVE A HEALTHY LIFE 21
THE PRUHEALTH PRODUCT 22
THE PRUHEALTH PRODUCT REWARDING INDIVIDUALS Members receive a percentage of their unclaimed premiums to offset against next years premium according to their Vitality status. Bronze Silver Gold Platinum 25% 50% 75% 100% of unclaimed premiums of unclaimed premiums of unclaimed premiums of unclaimed premiums 23
THE PRUHEALTH PRODUCT 24
PRUHEALTH EVIDENCE
PRUHEALTH EVIDENCE - DISCOVERY DATA 1,600,000 1,400,000 1,200,000 Membership 1,000,000 800,000 600,000 400,000 200,000-1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 (Aug) Source: Discovery data, 2004 26
PRUHEALTH EVIDENCE DISCOVERY DATA Variable Household Income (GBP at PPP) South Africa Overall South Africa High Income Population* U.K. Overall (GBP at PPP) 20,479 46,834 24,592 Possession of college / university degree 14.8% Access to the internet Own / rent a cellular telephone 32.0% Own a home computer 14.8% 66.7% 24.8% 8.3% 39.5% 58% 32.0% 94.6% 75% 11.1% 46.8% 54% UK High Income Population** 60,284 (not available) 71% 92% 81% Households with two or more motor vehicles 24.3% 60.2% 27% 51% Access to digital satellite / digital cable TV at home 4.7% 23.1% 44% 53% Note: *High income population refers to the top 20% of earners; **Household income is the average of the top 20% of households other data has been used for households earning 500 or more per week; Most data points are estimates based on the most recently available information Source: AMPS 2000/03; Statistics SA; World bank; UK National Statistics -Household survey 2002; UK Department of Education 27
PRUHEALTH EVIDENCE DISCOVERY DATA MARKET SHARE OF SA MEDICAL INSURANCE AMONGST TOP 200 COMPANIES Liberty Life Spectramed Bonitas Bankmed Protector Fedhealth Sizwe Ingwe National Medical Plan Other Self -insured Discovery Source: Financial Mail Top 200 Companies Survey 28
PRUHEALTH EVIDENCE IMPACT ON BEHAVIOUR IMPACT ON PREVENTATIVE CARE Source: Discovery data, 2004 29
PRUHEALTH EVIDENCE IMPACT ON BEHAVIOUR IMPACT ON PREVENTATIVE CARE Source: Discovery data, 2004 30
PRUHEALTH EVIDENCE IMPACT ON BEHAVIOUR BREAKDOWN OF BODY MASS INDEX [FIRST AND SECOND TESTS FOR VITALITY MEMBERS] 33% REDUCTION IN OBESITY AFTER SECOND TEST Source: Discovery data, 2004 31
PRUHEALTH EVIDENCE IMPACT ON BEHAVIOUR BREAKDOWN OF STEP TEST RESULTS [FIRST AND SECOND TESTS FOR VITALITY MEMBERS] 49% MORE PEOPLE WITH GOOD OR EXCELLENT FITNESS Source: Discovery data, 2004 32
PRUHEALTH EVIDENCE IMPACT ON OUTCOMES DISCOVERY MEDICAL TREND Vs. INDUSTRY AND INFLATION Salary Industry Discovery Source: Discovery data, 1993-2004; Statistics South Africa 33
CONCLUSIONS
CONCLUSIONS Social norms, attitudes, and ingrained habits create the context for any behavioural change Knowledge is critical, but needs to be personalised Measurement, feedback and a sense of achievement is important Price is an important determinant of usage Financial incentives in the right places can generate significant changes in behaviour All of these elements need to be taken together to generate sustainable behaviour change But within this, financial incentives can play a fundamental role in converting intentions to habitual actions 35
INCENTIVISING HEALTHY BEHAVIOUR Presenting to: IPPR Date: 4 May 2006 Shaun Matisonn CEO, PruHealth