Wellness Programs at Work

As of late, more and more corporations are offering wellness programs to their employees. While the main goal of these programs is to reduce rising health care costs, there are many other potential benefits that companies hope to reap as well, such as increased productivity and improved employee morale. However, since many of these programs are relatively new and because it is difficult to measure their results, there is an ongoing debate on the actual effectiveness of wellness offerings at work. Therefore, it is necessary to examine in depth the reasons behind wellness programs, what the programs actually entail, and the potential benefits and drawbacks of them.

By the early 1990s, health benefit costs were roughly 10% of total employee compensation. These costs have continued to rise over the years, to the point where companies are desperately seeking methods to reduce them. Many corporations have opted for wellness programs, in hopes that investing in employee health now will reduce expensive claims later on. In addition, employers can save money through better attendance and increased productivity. The reasoning behind this is that healthy, fit employees will use less sick days and will be more energized and able to get their work accomplished. Lastly, many companies think that wellness programs are a retention tool and a means of retaining employees who value these offerings.

Examples of current programs being offered are weight/obesity management, chronic disease management, smoking cessation, workout classes, fitness center access, seminars on improving health and nutrition, flu shots and blood pressure screenings. Some companies are actually offering incentives to employees who opt to take advantage of these offerings. For instance, Aetna employees receive twenty-five dollars for getting an annual physical, a flu shot or a mammogram. Even though these rewards come at a cost to the companies who offer them, it is small relative to the possible expenses that could result from illnesses and conditions that these procedures prevent. Other companies offer reduced premiums to those employees who pledge to live healthy lifestyles by making certain decisions, such as always wearing seatbelts. While these pledges are on the honor system, later claims may be denied if it is found that the employee did not act in accordance with his or her promise to the company.

One of the pioneers of wellness programs, Johnson and Johnson, has reported that so far their initiatives have proved successful. The company offered its wellness program to its headquarters office first and compared the costs at that location to other worksites where no program was offered. Overall, Johnson and Johnson estimated savings of at least $1.9 million annually through decreased medical costs, reduced sick leave and increased productivity. The hospitalization costs were 40% lower and absenteeism was 18% lower at the headquarters office than at offices where a wellness program did not exist. Similarly, Coors Brewing Co. estimated that its annual savings due to wellness initiatives were between $440l000-$1.8 million. These savings were due to decreased medical costs, less sick leave, and increased productivity. When calculating the return on investment for their wellness program, Coors determined that for every dollar spent on wellness, the company realized a $2.38 return.

While these results seem impressive, it is important to note the ambiguity of these measurements. Even though Johnson and Johnson used control groups, it is also possible that the employees at the headquarters office were the ones who designed the program, and were thus more motivated to take advantage of it. Coors' results were not explained, thus making it is difficult to determine how exactly the savings figures were calculated. Some of the measurement tactics used by other companies are questionable, such as including the cost of new carpeting as savings at a company who offered smoking cessation programs.

Besides the difficulty in determining the actual results of the wellness programs, many companies are having a hard time getting people to participate. Coors, a company with an extensive array of wellness programs, has only a 20% participation rate. This is why so many companies have opted to provide incentives for those employees who choose to take advantage of the programs to be healthier. However, these incentives are not always enough, especially for those who are most unhealthy. Companies are desperately trying to target those employees with conditions that put them at risk for future illness. This group includes smokers, people with hypertension and those who are dangerously overweight. In a survey of 157 employers, only 1% said they had complete success in getting workers with manageable diseases to join the wellness programs offered. Without getting these high-risk people involved, the wellness programs can certainly not be considered a complete success.

After reviewing this information on wellness programs, it is clear to me that companies need to take certain steps in order to achieve their goals. First, it seems that not enough energy is put into publicizing the programs to all employees. Often times, employees do not participate because they do not know that the opportunities are there. Second, even though they can be costly, companies must offer incentives to employees. These incentives need to be valued by employees, thus it might be wise to test many out or to distribute surveys to find the best ones. Without these incentives, people will not be as motivated to participate and thus, the programs will be useless. Third, corporations need to target those employees who lead the unhealthiest lives. This means offering programs for specific conditions and offering rewards that people will value. For instance, perhaps a company with a significant overweight population should consider allowing employees to work out during company time. These people might be more motivated to exercise if it means they can take a break during the day. While this may mean that a company loses an hour of time, in the end they might avoid costs associated with heart disease or diabetes. This offering would not be appropriate for a company with a young, active workforce, which brings me to the point that wellness programs must be tailored to the company's employees. Each company will have a unique blend of programs that are appropriate for its employees. Lastly, before implementing any wellness program, a need for it should be established and interest should be demonstrated. It does not make sense to offer a program without being sure that people will participate. Research is essential to make sure that programs will not be a waste of time and money. Then, once the programs are in place, they must be monitored and altered as necessary.

Works Cited

DeMoranville, Carol W., Denise Schoenbachler and Jim Przytulski. "Wellness at Work."

Marketing Health Services Summer 1998: pg. 15

Gray, Christopher. "Wellness Program Payback." Modern Healthcare 10/14/96, Vol. 26

Issue 43: pg 72

Gonzalez, Gloria. "Financial Incentives Provide Impetus for Employees to Improve

Health." Business Insurance 2/14/2005, Vol. 39 Issue 7: pg. 6

Smoyer, John. "Wellness Programs: Helping Companies Feel Better."

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