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February 10, 2014

Wearable fitness technology shifts employer wellness programs

Photo | Norm Bell More than 300 vendors were showing wearable fitness technology at the recent International Consumer Electronics Show in Las Vegas.
By Norm Bell

A virtual tidal wave of wearable fitness and healthcare technology is fueling a reboot of employer wellness programs.

During a two-day Digital Health Summit as part of the recent Consumer Electronics Show in Las Vegas, experts pointed to the arrival of a whole new billion-dollar industry sector based on making tracking health metrics easy, personal, effective and cool.

Losing traction are corporate return-on-investment calculations that led to forced participation in cost reduction programs delivered by remote third parties.

Gaining ground are employee-driven, feel-good programs pitched as benefits that entice participation through use of cool wearable fitness technology that allows users to monitor their progress in real time and compete with colleagues for rewards, status and bragging rights.

Speaker after speaker told standing-room-only audiences the new gold standard is engagement — show your employees some love and they'll love you back — rather than hard dollar savings.

Wearable gear being tested by employers and their workers range from activity trackers and blood pressure devices, to heart monitors and devices that measure glucose levels and calories burned. Fitness is driving today's rush to market. But investors and insurers are seeing a bright future for devices that can monitor chronic disease and help spur patients to make healthy choices.

The potential for using the technology to monitor senior citizens as they continue to live at home also holds serious commercial importance, speakers said. But the elusive holy grail remains a device that automatically monitors calories taken in, without tedious data entry. Several researchers promised they're working on it.

Much of the underlying wearable technology isn't new. What's changed is the new focus on making wearable healthcare technology both fashionable and cool.

And it's working. The 20-to-35-year-old demographic has embraced wearable gear as a lifestyle statement. Smart watches and wrist bracelets are selling in a dizzying array of colors and designs.

Wellness plan designers and insurers are noticing.

Derek Newell, CEO of Jiff, a digital health outcomes marketplace, offered a personal tale of his conversion to advocating for interactive, participatory health monitoring.

A decade ago, Newell explained, he was the chief marketing officer at LifeMasters, the first web-based patient monitoring system. Later he was CEO of Health Hero Networks, another remote patient monitoring service he later sold to Robert Bosch Healthcare. Along the way, he found that there was a high level of resistance from patients to these monitoring programs. Yes, the employer-mandated programs were good for them but the programs felt impersonal, invasive and passive.

The participation rates never met expectations, often languishing in the 20-to-30 percent range. Companies were seeing smaller returns on investment than the 3-1 ratio the industry often cited. A recent study put the real return rate at the break-even point.

He and others found a better answer in voluntary participation and wearable technology. His new venture, Jiff, is equipment agnostic. Jiff works with many vendors and many wellness programs. It anticipates a shakeout in the industry and is positioned to let the market choose the winning devices and brands.

Driving the conversation are impressive measurable results. Speakers ticked off a litany of promising results seen in test groups that embraced a voluntary fitness program using wearable technology:

• Participation rates that top 80 percent;

• A 600 percent increase in weight loss;

• 12 percent fewer heart attacks;

• And all for a $450-$600 investment in incentives.

Another study cited found fitness levels increase 43 percent if participants just strap on an activity monitor, whatever the initial motivation.

Experts cite the “sentinel effect” — the sense that somebody is watching you — for much of that gain. It's akin to the improvements noted in diet programs when participants simply write down what they are eating. But natural competitive instincts are also a factor — whatever the number is, I want it to be better tomorrow and I can't let my colleague get ahead.

And, of course, the biggest boost comes from seeing and feeling real-time results. Seeing gains in the data is good but actually feeling better is a super motivator.

Now wellness programs and insurers are getting into the action. Some are giving away activity trackers to employees; others are building models that track individual progress toward goals and award prizes. Many are using social media to build a sense of community and stoke competitiveness. Gift cards and bragging rights are powerful tools, they find.

A number of UnitedHealth Group executives — including Dr. Richard Migliori, the chief medical officer — detailed strong participation and results when the insurer provided wearable gear to employees.

The key, of course, is achieving meaningful participation. Making the program fun and the gear fashionable seems a winning combination. It's a finding that brings smiles to human resource professionals even as it perplexes those concerned with calculating ROI.

Among those cheering is Nicole Consiglio, workforce health consultant at Ovation, now a Digital Benefit Advisors Company, in Farmington. She's seeing more employers taking the longer view and seeing improved employee health as a strategy in its own right. In the Land of Steady Habits, larger companies are still concerned about ROI first, she said, but smaller companies are more likely to see happier, more engaged employees as a great result.

She said the 20-to-35 demographic has embraced fitness gear and devices are growing in popularity when included as incentives in wellness programs. She said she's seen concerns about privacy fade when a CEO takes the issue head-on. She pointed out that health plans already have individual data and can only share it with employers in the aggregate. And in companies with fewer than 100 employees, no data at all can be shared.

No matter what the short-term motivation, both HR and financial executives see a brighter future for wellness programs that return high participation and improved health.

ROI, in the form of reduced healthcare costs, should follow. But don't ask Jiff's Newell to project how much or when. He said when a company asks that question, he knows they're not ready for the new world he's selling.

Learn about a Shelton company that's positioned to benefit from a greater focus on wearable technology

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