In 2005, U.S. employers shouldered the majority of the nearly $2 trillion spent on health care. Corporate wellness programs may help in reducing this staggering figure if done right and consistently.
Workplace wellness programs are becoming more common as more companies become aware of the impact employee health has on performance in the workplace.
For many companies, though, workplace wellness programs are uncharted territory. Employers are unsure what types of programs are available and how these corporate wellness programs can be of value to their employees and provide a return on investment (ROI) for their company.
WHY WORKPLACE WELLNESS?
The work environment is an excellent place to encourage better health and wellness habits for employees, particularly as they spend the majority of their waking hours in the workplace. If an employer provides education on healthier habits and wellness, these guidelines can be incorporated into each employee's lifestyle and have a positive impact on their working environment.
According to Mayo Clinic Health Risk Assessment data, the most prevalent lifestyle risk factors include poor nutrition, emotional health, safety and weight. These risk factors are good places to begin for many companies seeking to develop wellness initiatives.
It makes sense that a healthy employee who focuses on the above factors will have positive results in terms of performance and behavior, which in turn contributes to their employer's bottom line.
What's more important when assessing the success of a wellness program: improvement in employee health, ROI for the company or both?
WHY WELLNESS PROGRAMS ARE NEEDED
Before addressing the benefits of wellness programs, let's consider the impact of poor health: heart disease, lack of productivity, stress, low energy and risk of illness and disease, to name just a few.
Research shows that individual health and well-being (quality of nutrition, stress management, physical activity levels, obesity and tobacco use) can have a significant impact on health costs for employers.
There are many types of corporate wellness programs that appeal to different companies and their objectives. The core of any corporate wellness programs basically is to encourage employees to take the necessary actions to create healthier habits and behaviors.
Corporations can choose from simple, log-in style online portals to educate their employees on various topics of health and wellness; full comprehensive wellness packages including health checks and tests; onsite gyms with personal trainers; and a wide range of other programs that fit just about any budget.
“The problem with most corporate wellness programs is that they are a ‘one-size fits all’ program,” says Janak Patel of JustWellness, which specializes in increasing employee participation in wellness programs. “These programs can only be of benefit if each employee can take the knowledge and tools and make it their own. A critical mistake companies make with wellness programs is offering the ‘how to’ but not the ‘want to.’ We all know we need to exercise, etc., but we don't necessarily do what we know. By addressing this, employee participation can be boosted.”
The main intention with any wellness program should be to get employees engaged and interested in actually implementing these healthier behaviors and participating in wellness initiatives.
“The main objective should be to have employees just start something and then build on that based on employee feedback,” says Patel. “Each employee is different, so certain aspects of wellness programs may suit some and not others. The key should always be to provide tools and information to each employee that they can modify to suit, so they can actually carry on with the positive changes. Any changes they then make would be in a positive direction.”
BENEFITS OF WELLNESS PROGRAMS
How do company wellness programs influence a business's bottom line? Does the benefit exceed the cost of the program? These are just some of the questions being asked about corporate wellness programs.
“The ROI for wellness programs is often elusive,” says Dr. Ron Leopold, New York-based national medical director and vice president for Metropolitan Life Insurance Co.'s institutional business division. “Most employers today have to make the decision to invest in some wellness initiative and they shouldn't expect hard numbers to demonstrate the ROI.”
More than half (57 percent) of larger employers (those with 500 or more employees) are providing employees with a wellness program. MetLife's Sixth Annual Employee Benefits Trends Study found that more than nine out of 10 (94 percent) companies, both large and small, that offer wellness programs believe they are effective for reducing medical costs.
“Keeping healthy employees fit and productive is vitally important to a company's success”, says Dee Edington, director of Michigan's Health Management Research Center. “The cost of an ailing worker goes beyond just medical expenses. There's also the monetary cost of paying for disability leave, as well as the strain on productivity if an ill person isn't effective at work.”
A review of 32 studies of corporate wellness programs found that following the adoption of the programs, claims costs were reduced by 28 percent, physician visits declined by 16.5 percent, hospital admissions declined by 62.5 percent, disability costs reduced by 34 percent and incidence of injury declined by nearly 25 percent (Aurora Healthcare, 2005).
GOING THE EXTRA MILE
In January 2007, Shands Jacksonville Medical Center began offering its employees the Virgin HealthMiles program, a provider of employee health programs that pay people to be active.
In calculating ROI, Virgin HealthMiles members track their daily activity by visiting measurement stations to track their key biometrics, including weight, blood pressure and body fat. The company also can track in real time the benefits of the program.
“In the first year, we got back $5.97 for every dollar that we invested in HealthMiles through lower health care costs and increased employee productivity,” says Emory Cook, director of human resource programs at the medical center.
“Of the 40 percent of companies that do track ROI across all programs, about half say they see a two-to-one return on their investment. About one-quarter see greater returns, while the other quarter says they are just breaking even or even losing money,” says Alix Stuart of cfo.com.
Corporate wellness programs also are valuable in other ways, such as:
- Attracting quality employees.
- Retaining quality employees.
- Enhancing morale, productivity.
- Reducing sick days.
“The ROI might be out there; it's just not jumping out at you,” says Mike Miele, president of Princeton, N.J.-based Apex Management Group, a division of Gallagher Benefits Services Inc. “There is no agreed-upon way to compute dollars from all these wellness activities.”
WORTH THE COST?
Corporate wellness programs can be an important investment in your corporation's most valuable asset: your workers. Common sense would dictate that if your employees are healthy and working to their best capabilities, both mentally and physically, then they are more likely to perform well on the job.
“We already know that risky behaviors cost more, and if we know from literature that if we get people to change their lifestyles, change risk, then you can deduce that you have a return on investment,” explains Jack Bastable, Leawood, Kan.-based practice leader for health and productivity with CBIZ Benefits & Insurance Group. “In a lot of ways, it's common sense: risk decrease, cost decrease.”
Employees should take every opportunity to improve their health by incorporating any benefits their company has to offer and then creating a healthy, realistic plan based on the information provided. Employers should encourage engagement in these types of behaviors by offering an environment conducive to these new habits and providing a structure that boosts retention on these types of programs.
All in all, offering some form of corporate wellness program to employees makes good sense and should be viewed as an investment in health and wellness, rather than an expense. Making this type of knowledge more accessible always is a good thing for both the employees and the company.
Nalisha Patel is an expert on psychology-based health and fitness training. She is author of Think and Grow Slim and is a consultant with JustWellness, which released a wellness program report titled 7 Secrets for Boosting Employees’ Participation in Your Corporate Wellness Program, available at http://www.JustWellnessOnline.com/freereport.