The Organizational Benefits of Employee Wellness Programs

//The Organizational Benefits of Employee Wellness Programs

The Organizational Benefits of Employee Wellness Programs

Even the best and most innovative businesses are experiencing the impact worker
well-being on their organizations’ performance. The bad news is that many
of these businesses are unaware of the extent to which less-than-optimal staff
member health and well-being is impacting workforce capacity and performance.
The goods news is that there is an increasing body of research and practice
than can help businesses mitigate this often unseen issue and develop significant
opportunities for improved workforce attraction, retention and performance!
This article focuses on how organizational leaders can improve physical and
financial staff member wellness in the workplace.

The Problem of Chronic Disease

According to the World Health Organization (WHO), 60% of deaths in 2005 could
be attributed to chronic disease (cardiovascular disease, cancer, chronic respiratory
diseases, and diabetes).1 The largest attributing factors to the chronic diseases
include tobacco use, physical activity, and diet.2 The costs of these diseases
are staggering. For example, if there were a 10% reduction in mortality from
heart disease and cancer, it could save the US $10.4 trillion annually.3 Further
the WHO projects that over 80% of the US population will be either considered
overweight or obese by the year 2015.

The Problems of Financial Distress and Dissatisfaction

As hard as it may be to fathom, a 2004 study found that 67% of U.S. Workers
are dealing with Personal Financial Issues.4 In another study, it was found
that these issues can exist in all segments of any workforce, regardless of
income, education, or position level.5 Couple these facts with our workforce
reality:

• The workforce is aging and demand for professionals in many industries
continues to exceed the supply – and will for the foreseeable future.

• Due to the shortages of quality personnel the stress on our current
workforce is increasing.
• With these workforce shortages, most businesses cannot continue to pay
spiraling market prices for professionals.
• Lastly, those personality attributes that make many professionals great
caregivers or service-providers also tend to make them less apt to focus on
matters of individual financial management.

The ROI for Employee Wellness Programs

There are significant reasons why businesses should employ Strategies to start
Employee Wellness Programs for their staff members:

  • Increase Productivity including reductions in health care and workers compensation
    claims, rates of absenteeism, and presenteesism;
  • Reduce employer paid health care and re-insurances premiums; and
  • Increase staff member, physicians and patient satisfaction; and
  • Increase staff retention and productivity.

A recent Towers Perrin case study6 found that a ten percentage point improvement
on staff member engagement was linked to a 4.6 percentage point improvement
on customer satisfaction and revenue growth and labor cost improvements equal
to a 2.8% impact on controllable margin.

What all this shows is that providing Employee Wellness Programs and rewards
is more than just “the right thing to do.” Rather, there is a profound
business case. As workforce capacity and engagement increase, a bottom-up cultural
change takes place in your organization. These changes drive improvements in
customer satisfaction, productivity, rates of absenteeism, and presenteesism
– all of which drive improvements in profitability.

The Course of Change

As an employer, you can have a tremendous impact on the health of the community.
Here are a few suggestions on how you can engage your staff members (possibly
include flowchart):

  1. Define the Plan – Determine if you have the internal resource availability
    and knowledge to develop a formal Employee Wellness Program. Many organizations,
    due to confidentiality legal and other reasons, choose to engage outside partners
    to manage these processes.
  2. Communication – Once you have developed the plan, communicate the plan
    to all staff members – using multiple media and approaches.
  3. Lead by Example –Begin Employee Wellness Programs at the top (walk the
    walk). Allow yourselves the opportunity to go through a health risk assessment
    and a financial assessment. If you can, communicate your results and your
    action steps to staff.
  4. Develop rewards for Staff Participation – Here are a couple of financial
    rewards you can provide staff that are low cost and optimally have a return
    on investment (ROI):

    • Pay staff members to take a risk assessment
    • Lower employee contributions to medical plan for those with reduced
      risk of chronic disease and correspondingly increase employee contribution
      to medical plan for those with increased risk of chronic disease
  5. Make available Personal Risk Assessment Counseling – Make available
    resources that can meet one on one with each staff member to understand their
    health risks and opportunities
  6. Eliminate Trans-Fat from Your Dietary Offerings – If you have workplace
    food facilities, and haven’t been required by legislative statute, you
    should eliminate trans-fatty oils from the staff member and customer meals
  7. Eliminate Smoking Areas for Workers – More and more organizations, including
    large cities, are now banning tobacco use on their facilities.
  8. Make available Proper Monitoring Programs – Probably the hardest component
    of the plan, the ongoing monitoring is critical. Some organizations are large
    enough to own or build wellness centers – but even then, many staff
    members feel uncomfortable in using them. Typically the users of wellness
    centers are those least in need. The good news is that there are many external
    and web-based tools and options that are available today.
  9. Encourage Other Local Businesses to Make available Employee Wellness Programs.
    In some cases (e.g. hospitals), there are options where this can even generate
    revenue and/or deepen relationships with the communities you serve.

Wellness Programs: Potential Legal Issues

When thinking about a Employee Wellness Program, one must take into account
certain requirements under ERISA, the Internal Revenue Code (Code) and the Public
Health Service Act (PHSA). All three laws were amended by the Health Insurance
Portability and Accountability Act of 1996 (HIPAA) to provide for improved portability
and continuity of health coverage. HIPAA also added Code section 9802, ERISA
section 702 and PHSA section 2702, each of which prohibits discrimination in
health coverage based on health status.

To be a bona fide Employee Wellness Program, the plan must satisfy
the following requirements:

  • An individual’s total reward must be limited. A limit of 10 percent to 20
    percent of the total cost of employee-only coverage may be appropriate, according
    to the DOL.
  • The program must be reasonably designed to promote good health or prevent
    disease.
  • The reward must be available to all similarly situated individuals. The
    program must allow any individual for whom it is unreasonably difficult because
    of a medical condition to meet the Employee Wellness Plan standard (or for
    whom it is medically inadvisable to attempt to meet the Employee Wellness
    Plan standard) an opportunity to satisfy a reasonable alternative standard.

Source Information:
1 2005 Preventing chronic disease: A important investment. World Health Organization
2 2007 Working Towards Wellness: Accelerating the prevention of chronic disease.
World Economic Forum
3 2007 The Value of Health and Longevity. Kevin M. Murphy and Robert H. Topal,
University of Chicago
4 2004 Employer/Employee Equation Research on Worker Types, Preferences and
Engagement Issues – Concours Group, Age Wave and Harris Poll
5 1997 Neal E. Cutler, Ph.D
6 2003 Talent Report: New Realities in Today’s Workforce – Towers
Perrin

2009-03-06T04:53:20+00:00 Wellness Programs|0 Comments

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