Employers Adopting Wellness Programs To Lower Health Care Costs
Companies are increasingly using wellness programs to help improve employee health and mitigate rising medical insurance costs, according to a survey sponsored by the ERISA Industry Committee (ERIC) and the Deloitte Center for Health Solutions.
The survey of 365 large companies found that 62% of employers currently have a health promotion or wellness strategy in place, and an additional 33% are considering adopting programs. Just 5% of the sample reported having no interest in starting a wellness program.
Of those companies that have implemented wellness programs, 64% cited rising health care costs as "a major factor in our decision," while 34% said increasing costs played some role. Only 2% of this group reported that health care costs played no role in the decision to start a wellness program.
At the same time, 83% of employers surveyed said they had asked their employees to contribute more to their health care coverage in the last year. An additional 30% said they began offering consumer-directed health plan options, such as flexible spending accounts, in the last year.
"Employers large and small see the potential in encouraging employees to lead healthier lifestyles by eating better, exercising more and not smoking," said Tommy G. Thompson, the independent chairman of the Deloitte Center for Health Solutions. "Wellness programs are a long-term investment in a healthier, happier and more productive workforce. That will be good for workers' waistlines—and companies' bottom lines."
Most employers agreed, however, that it would likely take some time before they saw the full benefits of wellness programs. Asked if they believed helping employees lead healthier lives would make a noticeable difference to company health care costs, 80% said it would, but that it will take a while to see results. Only 4% said they expected to see an immediate improvement, 14% said improvement was possible, and 2% said they expect the programs to have no measurable impact.
Asked if they had noted a reduction in sick days since implementing their wellness program, 65% of respondents said it was too early to tell, 4% said yes, and 31% reported seeing no reduction.
Most corporate wellness programs include a range of health promotion initiatives, according to the survey. The most frequently implemented initiatives cited by respondents were health risk assessments (61%), smoking cessation (56%), on-site workout facilities (50%), the addition of healthier foods to cafeteria menus (48%), employee diet groups (48%), subsidized gyms (43%), and diet counseling (27%).
Nearly half of the employers surveyed (47%) said they offered employees incentives to participate in wellness programs. These included cash payments (29%), rebates for program costs (30%) and reduced medical co-pays (15%). Among the other incentives used were gift certificates, prizes, and free gym memberships.
Despite these incentives, the majority of respondents indicated their employees did not take advantage of offered wellness programs. Only 16% reported that more than 50% of their employees used the programs and, of this group, only 1% reported that more than 90% of their employees used the programs.
"Wellness programs are an efficient and cost-effective way to encourage workers to lead healthier lives, and healthier employees mean lower costs for employees and employers," said ERIC President Mark J. Ugoretz. "The survey …show[s] employers how their employees take advantage of available wellness programs, and if those programs need to be changed or new ones added."
