Posted by Company Wellness | Posted in Company Wellness, Wellness Programs | Posted on 31-08-2010
Initially introduced by Halbert Dunn in the 1950’s, wellness became a well-liked buzzword during the late 1970’s and received considerable academic attention in the 1980’s.
Wellness programs for personnel became more widespread during the following decade, and credible evidence for their economic viability began to be published.
There have now been over 100 published studies on this topic and a number of systematic reviews.
Health risks increase costs. Medical and medical insurance costs escalate with both age and number of risks present.8,10 the number of risks is also strongly related to sick leave absenteeism, Employee’s Compensation costs, short-term disability, and lowered productivity (”presenteeism”).
Early company wellness programs were relatively basic and generally produced a ROI of less than one dollar for every dollar spent operating the wellness program (ROI = <1 - 1).8
Such health promotion programs may be characterized as “fun-oriented”. Participation is entirely voluntary, and there’s no particular focus on the reduction of specifically identified high risks.
Interventions and activities are not customized, and there’s no emphasis on the management of medical costs. These wellness programs are generally site-based only, lack options to address all of the major behaviorally-related health risks, and lack multimodal presentation.
Minimal or no incentives are provided to workforce for participation, and services to spouses and family members are not available. Most such health promotion programs lack meaningful investigation.
More conventional health promotion programs are “activity-oriented” and have shown an Return On Investment of between 1 – 2.5 and 1 – 3.5.8 These health promotion programs may have a greater emphasis on health and risk reduction, although the efforts are relatively wide and not customized.
They could have some generalized emphasis on healthcare cost management, although not necessarily aimed at specific high risks. Most are site-based and voluntary, with spouses included only rarely.
Modest incentives might be utilized to encourage participation. Formal analysis might be weak.
The newest and most economically viable wellness programs are “results-oriented” and exemplify the health and productivity management model. These wellness programs consistently produce return rates of 1 – 4 or greater within a 12-24 month period.8
Such wellness programs are strongly focused on the reduction of particularly identified high risks and the management of health costs. They are typically voluntary, but use strong financial and other incentives to promote participation.
They are multi-component in nature (address all major risks), and have both on-site and virtual modalities of operation. The interventions are highly targeted and individualized, and offered to spouses in addition to personnel.
For businesses, the cost of providing health insurance for their workforce is of excellent importance. Those costs have been increasing at annual rates between 6 percent and 14 percent.
Chapman’s 2007 systematic review7 reported an average reduction in healthcare costs of 26.5% so of staff member health promotion programs. His review covered 60 of the most scientifically exact studies, with an average of 3.77 years of study.
Absenteeism as a result of disease is another cost driver. Chapman’s review7 reports an typical reduction in sick leave of 25.3%. Cost for Employee’s Compensation was decreased by 40.7%, and disability costs by 24.2%.
There’s also an emerging literature on the costs of presenteeism (reduced productivity).11,13 In one study, every risk lowered through a wellness program yielded a 9% reduction in presenteeism (and a 2% reduction in absenteeism).11
Some organizations have achieved a zero% increase in health care costs across at least brief periods of time.10 Doing so requires 90-95% participation of the employee population in focused health promotion programs, with 75%-85% of the staff members falling into the low risk category.10
Even though extensive efforts to lower the risk status of those in moderate or high risk categories should be made, the needs of currently healthy workforce should be addressed as well to avoid increases in risk-status.
Given the size of the federal workforce, meaningful cost savings in the government’s contribution to medical insurance premiums for employees could be achieved when a majority of that population were participating in active health promotion programs.
In like manner, improvements in absenteeism, employee’s compensation, disability, presenteeism, and turnover as a result of robust employee health promotion programs would yield substantial fiscal benefits for the government.
References
1 Aldana, Steven G. (2001) Financial Impact of Wellness Programs – A Robust Review of the Literature. Am J Wellness 15(5) – 296-320.
2 Chapman, Larry. (1998) the Role of Incentives in Wellness. The Art of Health Promotion 2(3) – 1-8.
3 Chapman, Larry. (2003) Biometric Screening in Wellness – is it Really as Important as We Think? the Art of Wellness 7(2) – 1-12.
4 Chapman, Larry. (2005) Meta-Evaluation of Company Wellness Economic Return Studies – 2005 Update. The Art of Wellness, July/August, 1-15.
5 Chapman, Larry. (2006) Worker Participation in Company Wellness and Health Promotion Programs – Just how Important are Incentives, and Which Ones work Best? North Carolina Medical Journal 67(6) – 431-432.
6 Chapman, Larry, Lesch, Nancy, and Passas Baun, Mary Beth. (2007) the Role of Wellness Coaching in Company Wellness. the Art of Wellness, July/August, 1-12.
7 Chapman, Larry. (2007) Proof Positive – an Analysis of the cost-Effectiveness of Company Wellness. Northwest Health Management Publishing, Seattle, WA.
8 Chapman, Larry. (2007) an In-Depth Look at the Economic Evidence for Rewarding Health Behavior Change. Workshop presentation at the World Research Group “Rewarding Healthy Behaviors for Health Plans and Companys” Conference, Orlando, FL, January 23-24.
9 Edington, Dee. (2001) Emerging Research – A View from One Research Center. American Journal of Wellness 15(5) – 341-349.
10 Edington, Dee W. (2007) Health Management as a Serious Company Strategy. Presentation at the World Research Group “Rewarding Healthful Behaviors for Health Plans and Businesss” Conference, Orlando, FL, January 23-24.
11 Pelletier, Barbara, Boles, Myde, and Lunch, Wendy. (2004) Changes in Health Risks and Be sure to work Productivity. Journal of Occupational and Environmental Medicine, 46(7) – 746-754.
12 Pelletier, Kenneth R. (2005) A Review and Analysis of the Clinical and Cost-Effectiveness Studies of comprehensive Health and Illness ManagementPrograms at the Workplace – Update VI 2000-2004. JOEM 47(10)1051-1058.
13 DeVol, Ross, Bedroussian, Armen, et. Al. (2007) an Unhealthy America – the Economic Burden of Chronic Condition. Report released by the Milken Institute. www.milkeninstitute.org.
14 Partnership for Prevention. (2008) Investing in Health – Proven Health Promotion Practices for Worksites. http – //www.prevent.org/images/stories/2008/investinginhealth_finalfinal.pdf.