Integration Insights

EAP Partnerships across Health Care Cost Segments

 By Mark Attridge, PhD, MA

 This column focuses on cost-based segments of care across the health care continuum – ranging from prevention to chronic disease. This is how employers “see” their overall health care costs each year.  Understanding this view can help EAPs to better position their services as a partner to other programs in each cost segment.

Cost-Segment Model

A cost-segment model has been widely adopted by human resources (HR) and benefits professionals as a practical way to conceptualize the pattern of paid health care claims they see each year. For example, I did a study in 2006 with Dr. Steven Nyce of Watson Wyatt, a health benefits consulting firm, that used claims data from over 1 million covered lives from multiple US employers from 2003-2004-2005. The results were as follows:


Segment 1. At Year 1 in 2003, the group with zero to less than $1,500 in total claims represented 68% of all lives and yet accounted for only 11% of the total costs. This group was also the most stable over time, as 68% of those in this group at Year 1 remained at low cost in Year 3.


Segment 2. At Year 1 in 2003, the group with between $1,500 and $10,000 in total claims represented 27% of all lives and accounted for 37% of the total costs. This group was mostly unstable over time. Our data found that only 29% of those in this group at Year 1 were still in this same cost group in Year 3 – as most had become less costly while others were more costly.


Segment 3. At Year 1 in 2003, only a small number of people comprised the third and costliest segment. These are often called the “Pareto Group.” In our study, those with more than $10,000 in total claims represented only 5% of all lives (just 1 in 20 people) and yet accounted for over HALF (52%) of the total costs. We found that 95% of those in this group at Year 1 became less costly by Year 3.


The findings clearly indicated that creating future cost savings must involve services for individuals in the healthy and acute care groups (Cost Segments 1 and 2) – and not so much toward those who already have chronic and costly medical conditions (Cost Segment 3). This data-driven insight is part of what is driving the current boom in offering employee wellness services.


Implications for EAP

This kind of research is good news for EAPs, as behavioral health issues are relevant to each cost segment but especially so for the acute segment. It is what EAPs do: People call the EAP when they are in distress and need help promptly. In the rest of this column, I briefly explain EAPs’ potential role in each segment.


Cost Segment 1: Preventive Care

The potential EAP partner programs in this segment include: Training and self-care tools, wellness and risk screening surveys, and occupational health and safety programs. EAPs can become more involved in this segment by:

* Providing educational trainings to employees, supervisors and staff on the role of EAP issues across the health continuum and their effects on work.

* Sharing validated brief screening tools for mental health and addiction issues by partner programs, including health risk surveys.

* Conducting promotional, awareness and anti-stigma campaigns in concert with wellness and safety partners to encourage use of EAP.

 Cost Segment 2: Acute Care

The potential EAP partner programs in this segment include: Work/life services and legal/financial resources, workplace crisis services and on-site health clinics. EAPs are already involved in this sector.

* As discussed in my last column, many EAPs already offer services for child care, elder care and other work/life issues, such as personal legal or financial issues.

* Most EAPs also already offer expert response when needed for critical incidents in the workplace.

* EAPs can also support the users of on-site medical clinics. A 2013 Mercer survey found that about 1 in every 3 US employers provide medical clinics on-site at certain locations with large concentrations of employees. Perhaps EAPs can add screening tools to identify potential behavioral health risks. EAPs could also offer follow-up outreach to clinic users for related stress and work performance issues.

 Cost Segment 3: Chronic Care

The potential EAP partner programs in this segment include: Specialty treatment for mental health and addiction, disease management programs for chronic conditions, and disability and return-to-work programs. EAPs can become more involved in this area by:

* Providing long-term case management support and follow-up for employees in treatment and relapse prevention for mental health and addictions.

* Offering “Pareto” case support services for issues beyond clinical care. For example, counselors could assist with daily life management and work-focus issues for disease management cases.

* Sharing screening tools for behavioral health issues with partner programs in chronic care and disability.

* Offering support for gradual or full return-to-work after disability to coordinate the roles of employee, supervisor, HR, medical, and insurance case manager. This kind of service is already a successful upgrade offering for the major EFAPs in Canada.



Potential partnerships and integrative practices for EAPs currently exist within each of the three main segments of the employee health care cost continuum. In the accompanying graphic, I added base and top layers to the three segments – as HR and Leadership represent the other key parts of the organization that EAPs need to interact with more often to gain access to programs in the other segments.

Forging stronger partnerships with HR and other leaders can create more opportunities for EAP to establish inter-segment connections. These aspects of the EAP integration model will be addressed in greater detail in future columns.

 CALL FOR CASE STUDIES: I would like to briefly profile EAP programs or vendors that are doing a good job of partnering with a client organization and other programs in innovative ways. Contact me with your suggestions for a case study. 

 NOTE: Research study references are available upon request.

Dr. Mark Attridge is an independent research scholar as President of Attridge Consulting, Inc., based in Minneapolis. He has created over 200 papers and conference presentations on various topics in workplace mental health, EAP, psychology and communication. He delivered a keynote presentation on ROI and the business value of EAP at the 2013 EAPA World Conference and is past Chair of the EAPA Research Committee. He can be reached at: