Posted in: NovemberCutting Costs Without Cutting Wellness
Cutting extra costs in tough economic times will help achieve fiscal responsibility, but often cuts can lead to a lack of employee productivity. The good news is that you can provide your employees more benefits at no cost to you by implementing a wellness program and building the cost into health care premiums. It will improve your employees’ health, increase engagement and productivity, and save your company money overall.
The Play or Pay Approach to Wellness
By setting health care premium contributions slightly higher for employees who do not want to participate in wellness programming, you can subsidize the program for those who are willing to take part and actively work toward lowering their health risks. This cost-neutral approach immediately rewards participation and facilitates early and fast adoption of wellness principles, setting the stage for long-term success.
Larry Chapman, MPH, and editor of The Art of Health Promotion, calls this the "play or pay" approach. Chapman also recommends using a similar tactic when dealing with incentive funding, which can sometimes lead to a $600 to $1,200 annual reward for the wellness "players." With this type of incentive offering, you can expect higher levels of participation which will drive risk reduction when implemented with other wellness "best practices"—ultimately resulting in higher and earlier rates of economic return.
Improving Employee Health
Just a few extra dollars added to your employee’s health care premiums goes a long way to saving your organization money. It will lower health care costs, reduce absenteeism, and increase productivity. And you will be able to provide a best-in-class wellness solution through the premier provider for small and mid-sized organization—Total Well-Being in partnership with Mayo Clinic Health Solutions.
Most literature shows a wellness return on investment (ROI) at around 3:1, while some cite even higher rates of return. A recent article in the American Journal of Health Promotion states that "best practice approaches have positive ROI on health care costs." In addition, most studies on ROI do not account for the savings that result from productivity outcomes such as lower absenteeism, fewer worker compensation claims, and improved work performance. Aldana documented economic returns using absenteeism data that indicate wellness participants take three fewer days off, resulting in a cost savings of $15.50 for every dollar invested in wellness.
The Bottom Line
Wellness programs are not only affordable, they’re cost-saving. If properly implemented and promoted, the return can be substantial, equating to money saved with the added benefit of a healthier and more productive workforce.
Total Well-Being specializes in implementing best-in-class wellness solutions for small to mid-size organizations. We can customize and implement a cost-neutral program for you today.
Sources
Aldana, S.G., Merrill, R.M., Price, K., et al. "Financial impact of a comprehensive multi-site workplace health promotion program." Preventive Medicine. 2004; 40:131-137.
Chapman, L., "Closing thoughts." The Art of Health Promotion. 2009; 23(4):11-12.
Sexter, S., Gold, D., Meraz, A., Gray, A. "Do employee health management programs work?" The Art of Health Promotion. 2009; 23(4):1-8.
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