Johnson & Johnson has one. So does Chick Fil-A. Indeed, practically every company in America has an employee wellness program in place, but how many actually measure the program’s effectiveness? Fewer than one quarter, according to a recent study by Buck Consultants. According to the study, 77% of employers in the U.S. offer at least one program to keep employees healthy (think free gym memberships and incentives to stop smoking), but only 23% actually measure the outcomes of those programs.
That’s a mistake, say health-care consultants. “By knowing what types of programs work best, you’ll be able to see how to move the needle in terms of health-care premiums and other benefits of corporate wellness, like reduced absenteeism and increased productivity,” says David Atkinson, vice president of corporate wellness for Cooper Corporate Solutions, a firm which helps companies design programs to keep employees healthy. Make no mistake: There are real benefits to be had by setting up an employee wellness program, and appropriately rewarding employees for their participation. Here are some tips to make sure you’re getting the most out of yours, and rewarding employees appropriately for participating.
Tip 1: Design a Program
Companies that are looking to wellness programs to reduce insurance premiums and absenteeism need to design programs that can be more specifically tied to those goals, Atkinson says.
As an example, when Redstone Presbyterian Care, a health-care facility with more than 400 employees, was hit with a 44% increase in health-insurance premiums, it realized it needed to do something – fast. “We weren’t paying attention to what was going on around us,” says Jim Hodge, vice president of human resources. Specifically, employee obesity, tobacco use, high blood pressure and other health risks were causing the company’s premiums to skyrocket.
Redstone initially responded with a variety of free fitness activities, like yoga and kickboxing classes, that employees could participate in. “We even offered ballroom dancing,” Hodge says.
Employees received points for completing every activity, and those points were redeemable for cash or merchandise, like fitness equipment. “What we learned was that people didn’t necessarily equate the fact that they were doing these programs for wellness,” Hodge says.
So Redstone adjusted its program; now, instead of simply participating in exercise classes, they also have to overcome several hurdles in order to participate in the company’s insurance program. Now, employees who want to be insured by Redstone must undergo a health-risk assessment, biometric screening and meet with a wellness coach three times annually. The result? “More of our employees are really paying attention to their wellness,” Hodge says. “Three employees have given up tobacco this year, and countless others have lost weight.”
The upshot? The company has saved more than $440,000 in insurance premiums, and has managed to hold annual insurance-premium increases to single digits. “We found that really educating people about their health works much better than simply throwing a bunch of programs at them,” Hodge adds.
Tip 2: Offer Incentives
Most employees won’t be eager to stop smoking or lose weight without a little nudge, say wellness experts. Indeed, 56% of companies in the U.S. offer incentives like gifts, merchandise, or reduced insurance costs, for participating in wellness programs. How to find the right incentives for your group?
That depends on how big of a change you’re asking employees to make, says Rich Allen, vice president of group benefits and risk analysis for Cooper Corporate Solutions. “If you’re looking at wellness as a fun thing for employees to do, small incentives such as logoed pedometers, yoga mats, T-shirts and athletic gear will do the trick,” Allen says. “If your objective is to change costs and risk factors for employees, you have to be much more aggressive in the incentives you offer.”
For example, companies covered by Cigna’s health plan can opt into a program that pays out bigger rewards, such as jewelry and electronics, for completing a series of health screenings or participating in a program to control their diabetes. Other companies reward employees for major lifestyle changes, such as a sustained drop in blood pressure, by reducing the amount they have to contribute to their health-care premiums. In a program Cooper created for NEI, a server company, employees who showed progress in health screenings would pay a discount on their health-care contributions. After participating in the program for four years, NEI had “almost completely eradicated high-risk blood pressure among its employees, and had a 50% reduction in employees with high-risk cholesterol,” Allen says. “That’s a pretty impressive result.”
Tip 3: Measure Results
Companies creating wellness programs to improve the work environment should be able to measure results by simply surveying the population. “Are employees having fun? Do they like what’s happening? Then good, you’re on the right track,” says Smytha Haley, a wellness consultant.
Those who want to track the effectiveness of the program on the bottom line should be prepared to wait about 18 months for a result, Haley says. For many firms, 18 months is the point at which workers’ bettering health begins to cancel out the cost of sponsoring and administering the corporate wellness program.
As a rule of thumb, the average cost to a business is about $3 to $5 per participating staff member per month. “Within three years of the launch you ought to be seeing meaningful savings,” Haley says.
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