Employer Health Care Strategies: Multinational Edition

by Clive Riddle, April 15, 2010

 It's one thing for a multi-state employer to weave their health care strategies through the maze of varying state regulations, delivery systems, demographics, patterns of care and consumer behavior. Consider the daunting task of attempting to synthesize a strategy that reaches across nations and continents.

TowersWatson tackles the subject, this week releasing results from their multinational employer health care survey: Workforce Health Strategies: A Multinational Perspective.  The survey “includes responses from 106 organizations that have at least 500 employees and significant business operations in more than one country. Ninety-three percent of the participating companies are based in North America and manage, on average, 25 health programs and operate in 20 countries around the world.”

Francis Coleman, senior international consultant with Towers Watson tells us “to mitigate growing health care risks and associated costs as well as boost worker productivity, multinationals can increase their use of health strategies that are truly global. In particular, forward-looking multinationals are using leading indicators of health and well-being to proactively and effectively focus their resources rather than react to the rising costs caused by lifestyle diseases and increased adoption of advanced medical technologies.”

But in considering the topic that TowersWatson raises, the question rattles around in the back of my mind ‘How big of a deal is this? After all, can the scope of the multinational work force really be that large?’ So a little background research was in order. First stop, the U.S. Census Bureau, Table 772. United States Multinational Companies--Selected Characteristics which indicates that in 2006 their scope incorporated:

• Total assets $18.5 trillion
• U.S. Parents
  • Capital expenditures $442 billion
  • Value added: $2.5 trillion
  • Employment : 21.7 million
• Majority-owned foreign affiliates:
  • Capital expenditures $153 billion     
  • Value added: $996 billion
  • Employment 9.6 million

So the answer is, yes, the scope is big, and is largely U.S. centric. The National Foreign Trade Council in a press release last year entitled U.S. Multinational Companies Strengthen the Domestic Economy informed us that “The worldwide operations of U.S. multinational companies are highly concentrated in America, not abroad in their foreign affiliates. Domestic parent companies accounted for nearly 70 percent of worldwide employment of U.S multinationals….and represents about 19 percent of total private-sector payroll employment….Foreign affiliates are located primarily in high-income countries that in many ways have economic structures similar to the U.S., not in low-income countries. Affiliates in high-income countries accounted for 79 percent of total affiliate output. …U.S. parent companies account for nearly 25 percent of all private-sector output (measured in terms of GDP), or more than $2.5 trillion.”

Getting back to the matter at hand, here are some key results from the Towers Watson Multinational Survey:

•  26% have a global health strategy in place today, and  an equal number plan to implement a global health strategy by 2012
• 77% offer employee health programs in lieu of, or in addition to, publicly provided programs in all or most of the countries in which they operate.
• 83% of respondents said that stress have a high or moderate impact on their health care costs and workforce productivity, while 77% said chronic conditions and 63% said obesity (63%) had this impact.
• 40% of respondents provide case management programs in most or all countries, while 25% provide disease management, 30% offer health promotion, health screenings and behavioral health programs and 25% provide health risk assessments in most or all countries.
• 51% indicate that non-U.S. markets lack available or reliable health care cost data 44% said these markets lack available or reliable health care products and services and 30% said they lack desired health care vendors

<!--[if !supportLists]-->·             <!--[endif]-->26% have a global health strategy in place today, and  an equal number plan to implement a global health strategy by 2012

<!--[if !supportLists]-->·             <!--[endif]-->77% offer employee health programs in lieu of, or in addition to, publicly provided programs in all or most of the countries in which they operate.

<!--[if !supportLists]-->·             <!--[endif]-->83% of respondents said that stress have a high or moderate impact on their health care costs and workforce productivity, while 77% said chronic conditions and 63% said obesity (63%) had this impact.

<!--[if !supportLists]-->·             <!--[endif]-->40% of respondents provide case management programs in most or all countries, while 25% provide disease management, 30% offer health promotion, health screenings and behavioral health programs and 25% provide health risk assessments in most or all countries.

51% indicate that non-U.S. markets lack available or reliable health care cost data 44% said these markets lack available or reliable health care products and services and 30% said they lack desired health care vendors