Although employers continue to use cost shifting to control health insurance expenses, many companies are also making wellness programs part of the overall strategy to keep costs down by keeping staff members healthy.
“Our entire health care system is organized around treating diseases after they occur, not preventing them before they occur. We need a paradigm shift that places prevention at the center of our health priorities.” – Lynn C. Swann, Chairman, President’s Council on Physical Fitness and Sports[/box]
One survey of 365 companies found that 62 percent have implemented wellness programs as a long-term investment to improve employees’ health. Of these companies, about two-thirds cited rising health care costs as a “major factor” in the decision to sponsor a program, and the other third responded that finances played “some role” in the decision.
In another survey, 80 percent of business executives said the best way to reduce health care costs is to provide financial incentives for employees to lead healthier lifestyles.
At the top of the list of wellness initiatives are health risk assessments, followed by smoking cessation programs. The surveyed companies also offered:
- Health risk assessments – 61 percent
- Smoking cessation programs – 56 percent
- On-site workout facilities – 50 percent
- Employee diet groups – 48 percent
- Adding healthier foods to the cafeteria menu – 48 percent
- Subsidized gym programs – 43 percent
- Allowing employees to use time during the workday to exercise – 27 percent
- Diet counseling – 27 percent
- Other initiatives, such as free flu shots, healthier vending machine choices, wellness Web sites, and on-site massages – 32 percent
Almost half of the companies with wellness programs offered employees incentives to participate, such as cash payments, reduced medical co-payments, rebates on wellness program costs, gift certificates and prizes.
While the surveys cited above focused on large companies, small and midsize businesses are also offering wellness initiatives. The National Federation of Independent Business reports that more than 80 percent of businesses with 50 or more employees have implemented some type of wellness program.
Most companies acknowledge that the payoff won’t come immediately. Employers were asked, “Do you believe that helping employees lead healthier lifestyles will make a noticeable difference to the company’s health care costs?” Eighty percent of respondents said “Yes, but it will take a while to see results.” Only four percent expected immediate improvement. Another 14 percent thought an impact on health care costs was a possibility, but said they had other reasons for participating.
The actual financial savings a company will realize from a wellness initiative is impossible to predict. It depends on the type of program and extent of employee participation. Of course, participation can be affected by factors such as incentives to join, awareness of the initiatives, and how the employer supports the program.
Keep in mind that wellness programs can do more for a company than just contain health insurance costs. Healthier employees are likely to be more productive, have fewer absences, and have better attitudes towards their jobs. Sponsorship of wellness programs can also enhance a company’s recruitment efforts and improve its image in the community.