Under a new state wellness program dubbed the first of its kind, New Jersey HMOs and health insurers are now required to provide free, comprehensive physicals annually to millions of Garden State adults.
But with the program's creator already working to expand the requirement to the rest of the country, HMOs nationwide are questioning the fairness and presumed benefits of such a measure.
"The emphasis on prevention is completely in sync with the goals of managed care," said Susan Pisano, spokeswoman for the American Association of Health Plans. "But there is always concern when you write something like this into statute, because it freezes it in time. Ten minutes from now, we could find out that some feature in the program doesn't help."
All AAHP members, Pisano added, voluntarily cover the selected screenings recommended by the preventive-medicine arm of the federal Agency for Healthcare Research and Quality.
Studies, however, have shown that a low percentage of patients in some U.S. health plans actually get the recommended screenings, said Donald Louria, M.D., the New Jersey program's creator and chairman emeritus of the Department of Preventative Medicine and Community Health at the state's Newark-based University of Medicine and Dentistry.
The New Jersey Health Wellness Promotion Act, which took effect last month, requires many of the state's health plans to provide a 17-point "Healthful Life Program" designed to promote healthier lifestyles, disease prevention and early detection.
The program, which covers members ages 20 and older, includes routine tests to detect anemia, cancer, diabetes, glaucoma and heart disease (See chart). It also calls for a physician or nurse practitioner to counsel patients on topics including breast self-exams, quitting smoking, weight control and seat belt use. The most unique feature is a private consultation, in which patients can discuss health concerns.
The state passed a similar law in 1993, but it never took effect because health plans tried to make the wellness program a rider to their policies and charge extra. An amended version, which specified that the program be part of a basic policy, passed the state Legislature this year and was finally signed into law by Gov. Christine Todd Whitman on Nov. 6.
While the state's health plans initially opposed the most recent bill because it failed to limit the cost of each physical, they accepted it when a $220 cap was introduced.
Still, the New Jersey Association of Health Plans, whose members represent 97% of the market, argued that the program could eventually lead to higher premiums.
"Everyone appreciates getting more services, but they shudder when they think of the size of their bill," said association spokeswoman Sonia Delgado. "Unfortunately, you can't separate the two. Whenever you add a service, ultimately someone has to pay for it."
The now-mandatory physicals could mean a boon in business for members of the New Jersey Hospital Association and the Medical Society of New Jersey, both of which supported the measure.
"Preventive services are more cost-effective than treating serious illnesses after the fact," said NJHA spokeswoman Kerry McKean Kelly. "This is something managed-care (companies) should have been doing all along."
Louria also said he believes the program will pay off in the long run.
"For every dollar you spend, you'll save two in future healthcare costs," he predicted.
But some industry observers remain skeptical.
While a growing number of insurers are indeed adopting wellness programs, with many of them including alternative therapies such as chiropractic, most are doing so simply to meet member demand, recent studies show (See related story, p. 50). But whether these programs provide any measurable return--in either increased health or decreased costs--remains to be seen, said Steve Riedl, senior consultant with the Chicago office of benefits consultant Towers Perrin.
"I haven't personally seen any proof that meaningful medical savings can be wrung out of these plans," Riedl said. "Many people assume it's basic common sense (that prevention efforts reduce long-term costs), but where is the hard evidence?"
For now, the New Jersey law requires the annual physical only for adults in a commercial HMO, PPO or traditional fee-for-service plan.
These health plans, which cover about 3.7 million of the state's residents, must send their members two annual reminders, one at the start of the year and one on each member's birthday.