A recent study by RAND Corporation that was published online in the January issue of the journal, Health Affairs, revealed that when it comes to workplace wellness programs, there may be a distinct difference in the type of programs that reduce costs and lower net savings.
According to the study, Managing Manifest Diseases, but Not Health Risks, Saved PepsiCo Money Over Seven Years, “workplace wellness programs can lower health care costs in workers with chronic diseases, but components of the program that encourage workers to adopt healthier lifestyles may not reduce health costs or lead to lower net savings.”
In the accounting profession – where highly sought-after recruits and top talent have greater latitude to demand exceptional benefits and “perks,” and the deadline-driven nature of the profession makes stress relief a priority – cutting-edge workplace wellness programs are becoming a de rigueur tool for employee recruiting and retention.
In fact, many accounting firm leaders say their workplace wellness programs have little to do with concrete cost analysis or net savings. They are designed to keep employees engaged, healthy, and, most importantly, happy to create a positive and productive workplace for all involved.
Their workplace wellness programs, they noted, transcend the fiscal bottom line.
A Mixed Bag of Results
The RAND study, which provided an assessment of more than 67,000 employees in PepsiCo’s Healthy Living Wellness program over a seven-year period, found that efforts to help employees manage chronic illnesses saved $3.78 in health care costs for every $1 invested in the effort.
However, the study, which was funded by PepsiCo, found the program's lifestyle management components that encourage healthy living did not deliver returns that were higher than the costs.
“The PepsiCo program provides a substantial return for the investment made in helping employees manage chronic illnesses, such as diabetes and heart disease,” Dr. Soeren Mattke, the study's senior author and a senior natural scientist at RAND, a not-for-profit research organization, said in a written statement. “But the lifestyle management component of the program – while delivering benefits – did not provide more savings than it cost to offer.”
RAND researchers emphasized that with any prevention effort, “it is often easier to achieve cost savings in people with higher baseline spending,” as found among those who participated in the PepsiCo disease management program.
The study found that the disease management participants who also joined the lifestyle management program experienced significantly higher savings, which suggested that proper targeting can improve the financial performance of lifestyle management programs.
“While workplace wellness programs have the potential to reduce health risks and cut health care spending, employers and policymakers should not take for granted that the lifestyle management components of the programs can reduce costs or lead to savings overall,” Mattke said.
The mixed bag of results proffered by this latest workplace wellness study may once again have workplace wellness program coordinators across the country scratching their heads and re-evaluating their programs.
Should they concentrate their efforts on disease management and eschew their efforts to encourage employees to improve their daily habits? Is it still too early in the workplace wellness revolution to tell whether their campaigns are paying off? Is it just flat out impossible to measure the more intangible benefits of holistic programs like workplace meditation? And, finally, can we all stop worrying about “office appropriate” yoga attire?
At least one element of the workplace wellness debate does seem to be certain: There’s no doubt employee health and wellness programs are becoming a common component of workplace culture.
In a recent RAND study conducted for the US Department of Labor, researchers found that approximately half of US employers with at least fifty workers and more than 90 percent of companies with more than 50,000 workers offered a wellness program during 2012.
‘It’s Part of Our Culture’
Indianapolis-based CPA firm Somerset CPAs has a longstanding, formal wellness program for its 165 employees. The program offers a wide array of wellness options for employees – from on-site wellness screenings, to “healthy snack” vending machines, to corporate yoga classes.
Deborah Williams, CFO and director of finance for Somerset CPAs who also chairs the firm’s Wellness Committee, said studies, like the one conducted by RAND, attempt to take a tape measure to the effectiveness of workplace wellness programs. To say these programs are not effective makes Williams mad.
“I agree that it is very difficult to measure the cost savings of programs that encourage workers to adopt healthier lifestyles,” Williams said. “Despite these findings, we believe there’s a definite benefit to offering these programs, such as accountability. Employees say they make better snack choices because fresh fruit and vegetables are available. They take the stairs rather than the elevator because their friends are doing it. It’s part of our culture.”
In addition to encouraging healthy eating and offering a wellness reimbursement program, Williams said Somerset also has a holistic program – corporate yoga – that is a cornerstone of its wellness initiative. While “yoga progress” may be impossible to statistically measure, Williams said, employee participation and feedback indicates it’s having a definite impact at Somerset.
“Yoga class on Fridays during tax season is a much-anticipated benefit,” she said. “People start asking for it in September and tell me they really need the stretching and stress-reduction benefits it provides.”
The fact that the RAND study indicated lifestyle management programs may not reduce health care costs or lead to lower net savings will not impact Somerset’s approach to wellness, Williams said.
“Maybe we can’t measure the impact our health and wellness program has, but it is a great selling point in recruiting and retaining employees,” she added.
Porte Brown LLC, a CPA firm based in Elk Grove Village, Illinois, also offers a wide range of health and wellness options for its employees. But even though the firm considers health and wellness benefits an essential part of its culture, Porte Brown has chosen not to formalize the program.
In other words, Porte Brown officials said, the firm practices “wellness for wellness’ sake.”
Tricia Carlstrom, marketing specialist at Porte Brown, said studies about cost savings really don’t impact the way the firm supports its wellness initiatives.
“Porte Brown’s philosophy is to create a positive work environment for their staff and clients, and supporting optional wellness initiatives – like annual flu shots, health assessments, weekly chair massages during tax season, employee weight-loss challenges, and corporate sports challenges – encourages a positive environment,” she said.
Porte Brown Managing Partner Bruce G. Jones, CPA, said wellness offerings are also important for all the intangible benefits they offer, like showing the staff how much the firm appreciates their hard work. In addition, Jones said, employee wellness initiatives, once considered a fluffy “perk” by many partners, are now viewed as vital tools for recruitment and retention.
“At Porte Brown, we take pride in attracting top talent to our firm,” said Jones. “We strive to make the work environment at Porte Brown fun and engaging. We make it a pleasant place to work, and therefore, we retain our top talent.
“At the end of the day, when our staff is happy, it is reflected in their work,” Jones continued. “And our clients, in return, are happy.”