WellAI’s Health Cost Savings Calculator – It Is Critical to Use Conservative Assumptions!

This is part 2 of the series on the WellAI’s health cost savings calculator for CEOs, CFOs and heads of HR.  When we do our modeling for the cost savings calculator, it is important to stay humble, so (hopefully) no one would blame us being biased and in making up numbers – e.g. “What kind of crazy assumptions did you make to come up with a 45% savings number?”  That’s right – assumptions matter a lot.  Garbage in, garbage out.  That’s why we made a decision to be as conservative in our assumptions as possible (to the rational extent, of course).

So how are we being conservative in our assumptions?  For example, researchers have to be careful when they estimate a true participation rate for a health-related program, such as a wellness plan or any digital health assistance.  Many studies report participation rate of eligible employees.  In most cases, eligibility requirement includes full-time employees only, 18 to 64 years of age, and excludes pregnant women.  However, we have to adjust this participation rate down, as we want to include all employees who pay for their health costs.

Keeping the issue of a true participation rate in mind, six studies – that analyzed various health risk management (or wellness) programs.  The average participation rate across these six studies was 36.0%.  The median participation rate was 35.4%.  To be even more conservative, we chose 30.8% to use in the current study, as that was a true participation rate in a health promotion (wellness) program from the most recent and the most comprehensive June 2020 mega-analysis study in the American Journal of Health Promotion (a sample of 439,689 employees).  The WellAI digital health assistant is much more than a traditional wellness program.  However, as we mentioned, to be conservative, we assume participation rate for the WellAI digital health assistant of 30.8%.

A March 2020 study by the researchers at the University of California San Francisco reported that more than 50% of all PCP (Primary Care Provider) and ER (Emergency Room) visits were virtual.  Some may take this 50% as a reasonable (and already very conservative) assumption for an employee telemedicine service usage.  However, there is obviously an overlap in using various WellAI tools.  For example, there is a high chance that an employee who utilizes the WellAI chronic diseases management program would also utilize the WellAI telemedicine service.  In addition, to be conservative, we are going to assume that those 30.8% who use the WellAI digital health tools outside of telemedicine would benefit from WellAI so much, they wouldn’t need the WellAI telemedicine service.  Hence, we are going to assume that only 19.2% (= 50% – 30.8%) of employees would use telemedicine.  This is a very conservative assumption because even if all of those 30.8% employees who use the WellAI chronic disease management program and other tools are completely cured after finishing the program(s), they may still need to use the telemedicine service for the PCP visits and so on.

In fact, the current study is the first one that estimates health costs savings from the WellAI telemedicine service versus the appropriate benchmark dictated by the COVID-19 crisis.  Pre-COVID, all studies analyzing an economic impact of implementing a telemedicine service were benchmarking against a face-to-face doctor visit.  Post-COVID, every major health insurance carrier with a PPO (Preferred Provider Organization) plan, HMO (Health Maintance Organization) plan or POS (Point of Service) plan not only offers, but encourages employees to use their telemedicine service, typically for a co-pay of $30 to $50 per visit.  Hence, our yet another very conservative assumption is that those employees who are currently on a PPO plan (e.g. many employees in a large company) would not experience additional benefit switching to the WellAI telemedicine service.  The assumption is very strong, even from a pure dollar perspective, not to mention the efficiency and quality of WellAI’s VideoMedix telemedicine service.  WellAI’s VideoMedix telemedicine service is part of the overall WellAI digital health experience.  Thus, the price per WellAI’s telemedicine visit would be much less expensive for an employer than the $30 – $50 mentioned above, not to mention that WellAI’s VideoMedix provides 24/7 unlimited service.

Percent of employees who would use the WellAI elaborate symptom checker is assumed to be 43.4%, based on an average from a 2019 meta-analysis study in NIHR’s Health Services and Delivery Research – by Chambers et al.  Of those people, who actually used a symptom checker, 14% opted out of GP (General Practitioner) visit in favor of self-care, and 18% opted out of ER (Emergency Room) visits in favor of self-care, according to a shortened version of the meta-study mentioned above – by Chambers et al in BMJ Open.  Both of these numbers, 14% and 18%, are on the lower end of the estimates mentioned in the study, once again, to keep our assumptions conservative.

This was just a snapshot of the assumptions used in the WellAI Cost Savings Calculator for Employers.  It is critical that we are unbiased in our estimates and stay true to academic integrity.

The WellAI app called Doc In A Pock is now available on your smartphone.  If you are an employer and would like an app that makes your employees healthier and happier, and save 34% to 45% on your healthcare costs, please visit https://wellai.health to sign up for 1-on-1 demo.

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