Employee Wellness Programs: The Bottom-Line Enhancer

Employee Wellness Programs are proven to improve productivity and reduce health care costs.  For a  business, that makes a difference in the bottom-line. Today, more than 81 percent of America’s  businesses with 50 or more workers have some form of Company Health and Wellness Program with the most  popular being exercise, tobaccos cessation classes, back care programs, and stress management. The  majority of companies offer Employee Wellness Programs simply because they think the benefit is worth  the cost. Yet business leaders continue to ask themselves how to control huge annual increases in  medical insurance premiums and health care costs.

For many companies, medical costs can consume half of organization profits or more. Some employer’s  look to cost sharing, cost shifting, managed care plans, risk rating, and cash-based rebates or  incentives. But these methods merely shift costs. Only Employee Wellness Programs stand out as the  long-term answer for keeping workers well in the first place.

Employee Wellness Programs are an example of health care reform that works. Results from America’s  finest companies, summarized here, are reason enough to consider offering Employee Wellness Programs.   This investment in your most important asset – your workers – can have a positive impact on your  bottom-line.

Company Health and Wellness Program Statistics:

Providence Everett Medical Center, a member of the WELCOA, in Everett, Washington, saved an estimated 3  million or a cost-benefit ratio of 1 to 3.8 over 9 years of an outcomes-based Employee Wellness  Program. By offering financial incentives ($250 – $325) to workers who meet specific organizational and  worker health initiatives the Company Health and Wellness Program continues to meet cost containment  expectations in the area of health care use, sick time, injuries, while improving health habits and  self-care practices.

During the first 4 years of the Company Health and Wellness Program there was a 28 percent average  reduction in health care utilization compared to nine other Providence hospitals that were used as a  control group.

Du Pont saw that every dollar invested in their Company Health and Wellness Program saved $1.42 over  two years in reduced absenteeism costs at Du Pont Co. (Well workplace Gold in Delaware). Absences from  illness unrelated to the job among 45,000 blue-collar workers dropped 14 percent at 41 industrial sites  where the Company Health and Wellness Program was provided, compared with a 5.8 percent decline at 19  sites where it was not.

The Travelers Corporation claims a $3.40 return for every dollar invested Employee Wellness Programs,  yielding total organization savings of $146 million in benefits costs. Sick leave was reduced 19  percent during the four-year research study. In addition to improving the overall health of 36,000  workers and retirees by reducing poor health habits and increasing good ones, The Travelers realized  cost savings by decreasing the number of unnecessary visits to a doctor and emergency rooms. In a  similar but smaller research study, members of a Travelers fitness center Company Health and Wellness  Program were absent from work significantly fewer days than non-members.

The Company Health and Wellness Program at Reynolds Electrical & Engineering Company, located in Las  Vegas, cost $76.24 per worker during the two years it has been in operation. Over half of the 1,600  workers took part in the Employee Wellness Program. Participants significantly lowered cholesterol  levels, blood pressure, and weight and experienced 21 percent lower lifestyle-related claim costs than  non-member. Resulting savings: $127.89 per member in the Company Health and Wellness Program with a  benefit to cost ratio of 1.68 to 1.

Superior Coffee and Foods, a Bensenville, Illinois-based subsidiary of Sara Lee Corporation, attributes  impressive results to the success of the business’s broad-based Employee Wellness Program. Superior  showed 22 percent fewer admissions to a hospital, 29 percent shorter hospital stays, and 42 percent  lower expenses per admission when comparing costs for this division’s 1,200 workers with costs for  other divisions. Long-term disability costs were down by 40 percent.

With medical costs per worker at $6,000, nearly twice the national average, Union Pacific Railroad  introduced their Company Health and Wellness Program to its 28,000 workers, mostly union and blue  collar, in 19 Western and Southern states. Beginning with a modest medical self-care initiative at an  annual cost of $50 per person, the Company Health and Wellness Program achieved a net savings of $1.26  million. In addition, a voluntary Company Health and Wellness Program to help workers decrease health  risks projected a cost-benefit ratio of 1 to 1.57 after one year. Workers in a treatment group  decreaseed their risk of high blood pressure (45 percent) and high cholesterol (34 percent); others  moved out of the at-risk range for weight problems (30 percent); and 21 percent stopped smoking.

Average medical costs of high-risk Steelcase workers- those whose lifestyles include two to four health  risks such as tobacco use, little exercise, overweight- are 75 percent higher than those of low-risk  workers. But high-risk workers at this Grand Rapids, Michigan-furniture manufacturing business who  improved their health habits through the company’s Company Health and Wellness Program and became low  risk cut their average medical claims in half thus lowering their medical insurance costs by an average  of $618 per year. If all high-risk workers (20 percent of the total worker population) in one location  changed their lifestyles to become low risk, the projected savings could total $20 million over three  years.

Workers at Berk-Tec, a small manufacturing business in Lancaster County Pennsylvania, learned self-care  techniques and decreaseed their business’s health care costs in one year. By using a self-care guide,  the 938 workers and their family members made smart medical decisions and saved $21.67 per employee and  dependent a nearly 18 percent reduction in costs. By combining reductions in doctor visits and  emergency room use, the corporation saved $39.06 per employee a 24.3 percent decrease in costs over the  previous year.

A medical claims-based research study of 72,000 people insured through 285 Wisconsin school districts  found a reduced demand for medical services among those with access to Employee Wellness Programs and  self-care programs. Reductions in medical services results in savings for the Wisconsin Education  Insurance Group of as much as $4.75 for each $1 spent, higher savings were found in the group receiving  access to a 24-hour phone-based nurse advice line, a self-care reference book, and health education  materials.

CIGNA’s Healthy Babies prenatal Company Health and Wellness Program delivered an average savings of  $5,000 per birth by offering expectant mothers with educational materials and rewarding early and  regular prenatal care. And 80 percent of participants had normal births without complications compared  with 50 percent for non-member.

With savings estimated to be as high as $8 million, the California Public Workers’ Retirement System  sent its 55,000 retirees a health rist assessment followed, in some cases, with individualized reports  and letters and self-care materials to encourage change and help reduce health risks among retirees and  at the same time reduce the health care claim costs. In another research study, Bank of America  retirees in California who chose the full Company Health and Wellness Program and demand reduction  program showed a decrease in total direct and indirect costs of 11 percent compared with a rise of 6.3  percent for those who completed only a simple health questionnaire.

With reduced health care claims, medical costs decreased 16 percent for employees in the City of Mesa  (Arizona) who took part in the broad-based Employee Wellness Program. The city realized a return of  $3.60 for every dollar invested in the wellnss program for the city employees.

To prevent back injuries among its employees, a county in California targeted white- and blue-collar  workers, provided classes and fitness training. As a result, there was a significant increase in worker  morale, reduced worker’s comp claims, medical costs and sick days related to back injuries producing a  net cost-benefit ratio of 1 to 1.79.

Employee Wellness Programs: Savings

Employee Wellness Programs provide Long-Term Savings

Employee Wellness Programs, according to an article in Crain’s Detroit Business, come in two choices:   Employee Wellness Programs or Medical Insurance products that aim to reduce costs if healthy habits are  followed.  Both options are a good choice, but only one will really provide long-term health benefits  for your employees and reduce costs over the years.

Employee Wellness Programs provide Assistance

Insurance-based products provide employees the opportunity, according to the article by Jay Green, to  save money on their premiums if they follow certain steps, including performing an online health  assessment, visiting their doctor, and agree to adopt a healthy lifestyle.  These plans usually involve  one coach call to the worker during the first 90 days.  We wonder if these brief wellness encounters  will actually change a person’s lifestyle.

It is the overall change in a person’s lifestyle, as well as disease prevention that will lead to  reduce medical cots in the future.

Employee Wellness Programs provide convenient Health Risk Assessments (HRAs) and testing for things  like diabetes, cholesterol and blood pressure.  As the article states, these have initial start-up  costs, but the savings accrue over time and employees are more likely to stay active in an onsite  worker Wellness Program.

Employee Wellness Programs Get Results

Finally, the article states that corporations with an effective Company Health and Wellness Program can  expect to see “500 percent reduce absenteeism, 400 percent fewer disability claims, and 350 percent  reduce health care costs.”  These are numbers that are very hard to argue with.