5 ways to cut costs for health plans and employers with a proactive, functional medicine approach

Healthcare costs continue to rise at an unsustainable rate—putting immense pressure on employers and health plans to find effective solutions. With annual healthcare spending increasing by 4-7% year over year, many organizations are searching for innovative approaches to manage these escalating costs. Luckily, there’s hope.

Functional medicine offers a promising path forward by addressing the root causes of health issues rather than just managing symptoms. This approach has the power to improve health outcomes, as well as significantly reduce long-term healthcare expenses. Here’s more information about what functional medicine involves and five ways it can help cut costs for health plans and employers.

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What is functional medicine?

Functional medicine practitioners work to identify and address the underlying factors contributing to health problems through comprehensive testing, lifestyle modifications, and personalized treatment plans. This proactive strategy helps organizations reduce healthcare spending while improving employee health and productivity.

Research indicates that patients who received care through the functional medicine model experienced significant improvements in quality of life over a 12-month period compared to those in a traditional family medicine setting. 

Overall, functional medicine offers a proactive approach—one that may prevent chronic and life-threatening diseases like heart disease and diabetes. This alone can drastically reduce healthcare spending and improve individuals’ lives. 

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How health plans and employers can reduce costs using functional medicine

With six out of 10 individuals in the United States suffering from one chronic disease or another, prevention has never been so important. 

Instead of treating people as they get sick, we can learn strategies that prevent illness in the first place. In turn, this can lead to reduced costs associated with health plans—as well as even lead to fewer sick days and potentially higher productivity. Here are five ways to cut costs and enhance employee well-being.

1. Implement comprehensive health assessments

Early detection and prevention are key to lowering healthcare costs. Comprehensive health assessments provide detailed insights into employees' health status before serious conditions develop. These assessments include advanced diagnostic testing such as detailed blood panels, cardiovascular risk assessments, hormonal profiling, and nutritional status evaluations—tools that traditional healthcare often overlooks until problems become severe.

By utilizing these advanced diagnostic methods, employers can identify potential health risks at their earliest stages, allowing for timely interventions and personalized prevention strategies. For instance, comprehensive metabolic panels can reveal subtle imbalances in liver function, kidney health, and glucose metabolism long before clinical symptoms appear. Similarly, advanced lipid testing can provide a more nuanced understanding of cardiovascular risk beyond standard cholesterol measurements.

Hormonal profiling can uncover imbalances that may contribute to fatigue, weight management issues, and mood disorders, enabling targeted interventions to optimize overall well-being and productivity. Nutritional status evaluations can identify deficiencies or excesses that may impact immune function, energy levels, and long-term health outcomes.

These proactive assessments, when combined with lifestyle interventions and personalized health coaching, create a powerful framework for preventing chronic diseases and reducing long-term healthcare costs. By addressing health concerns at their root cause rather than merely treating symptoms, employers can foster a healthier, more productive workforce while simultaneously reducing the financial burden of healthcare expenses.

This initial investment in comprehensive testing pays off by identifying health risks before they become expensive chronic conditions. For example, detecting pre-diabetic conditions can lead to interventions that prevent the development of type 2 diabetes. As a result, this could avoid an average of $2,671 per individual in annual medical costs. Similarly, early identification of cardiovascular risk factors can prevent costly cardiac events, which cost $18,931 per incident at the low end of the spectrum.

Companies that adopt extensive workplace wellness programs often see a strong return on investment (ROI). Research by Aldana found that implementing health and wellness initiatives in the workplace can lead to a 26% decrease in healthcare expenses and a 30% reduction in workers' compensation and disability claims. 

Additionally, a study by RAND Corporation found that wellness program participation was associated with reductions in emergency department visits by 42 per 1,000 employee years. Simply put, investing in workplace wellness programs saves companies money while keeping employees healthier and out of the emergency room.

2. Develop personalized wellness programs

The limitation of conventional wellness programs lies in their one-size-fits-all approach, disregarding crucial individual factors such as unique health profiles, lifestyle habits, and environmental influences. In contrast, functional medicine adopts a personalized approach, crafting wellness plans tailored to each employee and organization. This individualized strategy typically results in increased engagement, improved outcomes, and more sustainable health improvements.

Effective wellness programs often emphasize three key components:

1. Personalized nutrition plans based on:

• Comprehensive blood panels and biomarker analysis
• Metabolic assessments and body composition analysis

2. Customized stress management techniques aligned with:

• Individual stress response patterns
• Workplace-specific stressors and demands
• Personal resilience-building strategies

3. Environmental and lifestyle modifications to foster healthy behaviors:

• Ergonomic workplace assessments and improvements
• Sleep optimization strategies
• Work-life balance initiatives and flexible scheduling options

‍Effective workplace health initiatives can lead to significant benefits. Program success is achieved through predictable scheduled analysis of various data points, creating opportunities for proactive care and early interventions. Employee motivation can be achieved in partnership with the employer by creating tangible rewards and strong incentives for individuals to embrace a functional medicine and preventative approach, leading to lasting and healthy habitual changes.

3. Implement proactive mental health and corporate awareness

Mental health conditions and stress-related disorders are increasingly costly for employers. The American Institute of Stress estimates that workplace stress leads to over $300 billion in annual losses due to absenteeism, diminished productivity, and accidents.

A functional medicine approach to mental health integrates biomarker analysis, lifestyle factors, and psychological support. This creates comprehensive solutions that reduce both direct healthcare costs and indirect productivity losses. 

Comprehensive biomarker testing such as cortisol and dehydroepiandrosterone sulfate (DHEA-S), which are indicators of chronic stress and anxiety disorder, along with administration of the GAD7 and PHQ9 questionnaires, are effective in the early detection of mental health issues. Preventing mental health issues proactively can reduce healthcare costs associated with chronic conditions or severe health incidences.

4. Create an integrated care model

Providing effective healthcare means making sure all providers work together smoothly. An integrated care model connects functional medicine specialists and health coaches with the primary care physician to streamline treatment. This approach reduces duplicate tests, prevents medication mistakes, and keeps care consistent. 

Integrated care models, which coordinate efforts among healthcare providers, have been shown to enhance patient outcomes and reduce costs. For instance, a systematic review found that integrated care interventions can lead to reductions in hospital admissions and a positive impact on length of stay. By fostering collaboration among healthcare providers, integrated care models not only improve patient outcomes but also create a more efficient and cost-effective healthcare system.

5. Leverage technology for preventive care

Digital health platforms and wearable technology have revolutionized preventive care by enabling real-time health monitoring and early detection of potential issues. A comprehensive digital platform that integrates guidance on nutrition, fitness, wearable data, and biomarker analysis, coupled with asynchronous communication, can significantly improve patient compliance and health outcomes.

These tools enhance medication adherence and improve communication between providers and patients, leading to reduced emergency room visits and lower hospitalization rates. For instance, remote patient monitoring has been shown to decrease hospital readmissions for chronic conditions by up to 57%. This proactive approach allows for timely interventions and personalized care plans, ultimately reducing healthcare costs.

Wearable devices, like step trackers, not only incentivize individuals to increase physical activity but also provide valuable health data. Studies have demonstrated that consistent use of wearables for activity tracking and personalized feedback can lead to significant healthcare cost savings. Moreover, integrating biomarker analysis allows for a more comprehensive view of an individual's health status, enabling early detection of potential health issues and facilitating preventive measures.

Asynchronous communication features within these platforms empower patients to actively participate in their health management, improving engagement and health literacy. This increased involvement, combined with personalized nutrition and fitness guidance, can lead to improved health behaviors and outcomes. For example, digital mental health platforms have shown success in promoting self-care and resilience through access to cognitive-behavioral therapy exercises and mindfulness tools.

One study found that patient portals can improve health outcomes and healthcare efficiency, indicating that digital health platforms can lead to better patient engagement and sustained behavior changes. As technology continues to evolve, it offers a potential avenue to reduce costs associated with health plans while aligning with the preventative model outlined by functional medicine.

By leveraging these technological advancements, healthcare providers can optimize patient routing, improve triage accuracy, and enhance overall patient satisfaction. The continuous collection and analysis of health data enable healthcare professionals to make informed decisions, improve care coordination, and deliver personalized interventions, ultimately leading to better preventive care and reduced healthcare costs.

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Sources

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3. Esch, T., Stefano, G. B., & Fricchione, G. L. (2021). Effectiveness of Functional Medicine-Based Shared Medical Appointments for Chronic Disease Management: A Systematic Review and Meta-Analysis. BMJ Open, 11(4), e048294. https://bmjopen.bmj.com/content/bmjopen/11/4/e048294.full.pdf

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5. American Medical Association. (n.d.). The Case for Diabetes Prevention: Cost Savings & Health Outcomes. https://amapreventdiabetes.org/case-diabetes-prevention

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8. RAND Corporation. (2014). Workplace Wellness Programs Study: Final Report. https://www.rand.org/content/dam/rand/pubs/research_reports/RR200/RR254/RAND_RR254.pdf

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