Wellness programs pay off in lowering health care costs
Healthcare costs are rising, but employers are proactively working to curb costs and create healthier workforces -- and employees are getting onboard, according to a survey released by Virgin HealthMiles, a company that provides technology-based employee health programs that pay people to get active.
While 76 percent of American businesses report healthcare cost increases of as much as 10 percent year-over-year, nearly 90 percent are now relying on employee health and wellness programs to lower costs. Seventy percent of employers now offer incentives to employees to participate in wellness initiatives. The approach is working: nearly 88 percent of employees said incentives were an extremely or somewhat important contributor to long-term participation in wellness programs.
Additionally, social networks are creating organizational cultures of good health. Forty-four percent of employers said leveraging an individual's social connections with its workplace wellness programs has increased employee engagement. Almost 60 percent of employees said community and social elements of wellness programs were either "extremely" or "very" important in staying committed to good health.
The survey was released to mark June's National Employee Wellness Month. In its third year, the initiative was created by Virgin HealthMiles with support from the Strategies to Overcome and Prevent (STOP) Obesity Alliance, the Partnership to Fight Chronic Diseases, and the Healthy Weight Commitment Foundation. More than 90 companies across the U.S. and over 40,000 of their employees are participating.
"Employers and employees recognize they play a role in bending the healthcare cost curve -- and it must start with prevention," said Chris Boyce, CEO of Virgin HealthMiles. "More companies are implementing prevention-based wellness initiatives and using tools such as incentives and social connections to drive long-term participation and healthy behavior change. The value of these strategies is powerful, and our survey results show they create healthier workforces."
Key Survey Findings:
- Implementing Wellness and Education Programs Helping to Offset Rising Costs: More than 42 percent of employers said improved employee health from wellness investments would lower costs. Other strategies include education to make employees better healthcare consumers and increasing emphasis on work/life balance.
- Incentives Aren't One-Size-Fits-All: More than 38 percent of employers reported offering incentives in the $100-500 range and 22 percent in the $501-1,000-plus range.
- Measuring Program Impact Poses Challenges: More than 65 percent of employers said they measured the impact of wellness initiatives, but the approach is largely not validated and cumbersome. More than 61 percent rely solely on manual approaches, anecdotal data or periodic employee surveys to measure program impact. Correspondingly, more than 35 percent of employers said it is difficult to accurately track overall employee health improvements and impacts on healthcare costs. Only 23 percent leveraged technology to gain validated reporting to measure program impact.
- Employees Want Employers to Help Create Healthier Workplaces: Nearly 88 percent of employees said an employer has a responsibility to take a leadership role in encouraging and promoting workplace health.
- Employees Reap the Benefits of Improved Health: Employees who participate in wellness initiatives report improved activity levels, feel healthier and happier, and pay less in healthcare premiums.
The survey was conducted April 27 - May 13, 2011, via e-mail. The employer portion of the survey was completed by a combination of large employers across the United States and Virgin HealthMiles clients, with a total of 145 employer respondents. The employee survey was completed by 1,382 employee Virgin HealthMiles members.
About National Employee Wellness Month
National Employee Wellness Month is an annual initiative that helps business leaders learn how companies have developed successful strategies around prevention and good health. It showcases how supportive social communities, such as the workplace, can help to improve employee health and productivity and lower healthcare costs, and how leveraging an individual's social connections helps create and sustain a workplace culture of health. Together, the supporting National Employee Wellness Month organizations and their employees understand intelligent health decisions and supportive social communities can create a healthier, more productive workforce.