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America's Employers Controlling Health Care Costs, Improving Employee Lifestyles with Wellness Initiatives

Source: International Foundation of Employee Benefit Plans


Posted on 11 May 2012

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Wellness ProgramsSeven in ten American employers offer wellness initiatives, such as flu shots, health screenings and weight management programs that are directly attributable to improving the lives of their employees according to the International Foundation of Employee Benefit Plans’ recent survey Wellness Programs and Value-Based Health Care.

The study measured responses from the International Foundation’s wide-ranging membership representing single-employers/corporations, multiemployer trust funds and public/governmental employers.

While wellness programs have existed for decades, their prevalence has grown significantly over the past ten years. Even the recent economic downturn has not slowed their growth, with nearly 60 percent of American employers implementing new wellness programs since 2008; 23.7 percent have started offering them since 2010. Additionally, nearly two-thirds of organizations increased their wellness budgets in the last five years.

“Without question, employers are beginning to understand the direct connection that wellness initiatives can have on both employees’ health and health care plan cost savings,” said Michael Wilson, Foundation CEO.

The survey suggests a definite decrease in health care costs when wellness initiatives are offered, according to the 21.6 percent who have analyzed return on investment. Of the organizations that are analyzing ROI, 83 percent indicated a positive return. For every dollar spent on wellness initiatives, most organizations see between $1 to $3 decreases in their overall health care costs.

“Determining ROI can be of great benefit for employers—leading to increased buy-in from organization leaders and workers,” explained senior information/research specialist Julie Stich. “However it’s not an easy process. ROI can be difficult to measure since health improvement may be influenced by a combination of factors and because it takes an average of three years to see cost-saving results.”

According to the survey, the most prevalent reasons that organizations provide wellness initiatives are:
    •    To help workers enjoy better overall physical health (45.6 percent)
    •    To control health care costs (39.8 percent).

Of the respondents who presently do not have wellness programs but plan to implement them within the next 12 months, 50.7 percent cite their motivation for adding the initiatives is to control health care costs.

Screening and treatment programs including flu shots (85 percent), health risk assessments (79.9 percent) and smoking cessation programs (67.5 percent) are some of the most popular wellness initiatives offered. Employers also make available fitness and nutrition programs such as walking/fitness challenges (58.6 percent), weight loss/management programs (52.5 percent), nutrition counseling (39.6 percent) and on-site fitness centers/equipment (36.4 percent).

“One measure of success for a wellness program is the participation rate,” said Stich. “Organizations will not realize benefits unless there is sufficient participation.”

The survey found that the wellness initiatives with the highest participation rates are:
    •    Flu shot programs (49.6 percent)
    •    Health screenings (48.8 percent)
    •    Health risk assessments (48.2 percent)
    •    Health fairs (44.7 percent)

Nearly 90 percent of the organizations surveyed provide incentives to increase participation in their programs. The incentives that are most often tied to health risk assessments, health screening and fitness programs include:
    •    Gift cards and gift certificates (38 percent)
    •    Insurance premium reductions (36.7 percent)
    •    Non-cash incentives – e.g. prizes and raffles (30.9 percent)
    •    Cash rewards (26.9 percent)

Employers are often assisted in developing or managing their workplace wellness programs; more than 85 percent of the survey participants use an outside vendor such as an employee assistance provider or wellness consultant to implement or assist with the program.

About Wellness Programs and Value-Based Health Care

Survey responses were received from 646 individuals from the U.S. and Canada, including benefits and human resources professionals, financial managers, and other professionals. Respondents represented a variety of sizes, regions and industries or jurisdictions. Of the 646 members who responded, 539 were from organizations in the U.S. with representation from single-employers/corporations (66 percent), multiemployer trust funds (23 percent) and public/government employers (11 percent).


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