Where wellness shows up on the bottom line

The answer to soaring benefits costs may be as simple as getting staff off the couch
By Jacqueline Taggart and Jamie Farrell
|Canadian HR Reporter|Last Updated: 10/29/2003

Y

ear after year employers are told to expect the worst: double digit percentage increases in prescription drug costs in benefits plans, high renewal rates from plan underwriters and increasingly poor experiences in disability claims.

On top of these financial challenges, employers are often confronted by general dissatisfaction among employees with the benefits provided. Where is the beleaguered employer to turn?

One answer is to take a step back and stop doing the same old thing while expecting different results. If traditional or flexible benefits programs are not being appreciated for the investment they represent, or if a greater effort on disability claims management is not resulting in any appreciable difference in an employer’s claims experience, what is being overlooked?

It could be time to dust off that wellness initiative that’s been kicking around the HR department for several years.

Wellness programs are not new. Indeed, they were introduced several decades ago under the guise of “getting in touch with your inner self” or focusing on a holistic “mind and body” approach to employee health.

Unfortunately, for many bottom-line focused managers or directors, the whole concept of wellness programs was just a little too intangible and “left-brain” to be taken seriously.

But now everything old is new again. As the demographics of employee populations continue to grow older and the demands on these employees increase, both personally and professionally, many are looking for help.

More than that, they’re looking for a way to expand the personal ability to cope with the increasing demands and stress of their lives. If employers don’t think this affects workforce productivity, then it’s time to think again.

Employers don’t have to look hard for statistical evidence that wellness programs can make a difference. The suppliers of these programs are literally falling over themselves to provide employers with this information. A cursory search on the Internet found the following statistics available from sources as diverse as the

Business Journal of America

, the Wellness Council of America, the

Journal for Occupational Medicine

, the

Canadian Journal of Public Health

, and

Canadian HR Reporter

’s own online archives:

•At the Pillsbury Company, “each dollar spent on wellness saved the company $3.63 in health-related costs.”

•General Motors found that employees who were in a physical fitness program had a 50-per-cent reduction in on-the-job accidents, a 40-per-cent reduction in lost time and a 50-per-cent reduction in job grievances.

•A study of eight Halifax organizations, by the Atlantic Health and Wellness Institute, found firms realize a return-on-investment of $1.64 for every dollar spent on wellness.

•General Electric reduced health-care costs for members of its fitness program by 38 per cent in an eight-month period, while non-members’ health-care costs rose 21 per cent.

•The Coors Brewing Company found that, in 1999, it returned $6.15 for every dollar spent on its fitness program.

•Steelcase found that during a three-year period, medical costs for active employees were 55 per cent lower than for inactive employees.

•Tenneco discovered that the average annual medical claim was at least 50 per cent lower for fitness program participants versus non-participants.

•Dupont reduced absenteeism by 47.5 per cent over six years for its fitness program participants.

•Northern Gas Company employees who are in a corporate exercise program have 80 per cent fewer sick days than non-exercising employees.

•The Canada Life Assurance Company found turnover among fitness program participants was 32.4 per cent lower compared to non-participants.

While these statistics are primarily from the United States where health-care and group benefits systems are somewhat different, the message is that the programs demonstrably work.

Wellness programs can do more than just assist in containing annual health-care costs. They have the potential to influence multiple aspects of an operation, such as reducing absenteeism, preventing on-the-job injuries and increasing the effectiveness of disability management programs.

Wellness programs themselves have also expanded to encompass a broader definition of their services. They now focus on mental health as much as physical health by providing counselling and referral services through employee assistance programs and absence management programs, in addition to the more traditional lifestyle and exercise programs.

Employers need to re-evaluate corporate philosophies and what is really most important in the context of employee satisfaction and productivity. If traditional benefits aren’t meeting the needs of employees, why not step outside the box and try a different approach?

If employees routinely work long hours and late nights, consider making arrangements with a nearby restaurant for regular pickup or delivery services, thereby offering a healthier alternative to on-site vending machines.

If peak business periods stress out the work force, then consider an on-site wellness fair or information day where introductory neck massages or yoga sessions might alleviate some of the pressure. Be creative because there are multiple options available.

No two corporate wellness programs are the same because every organization is different. But a typical program might include: health screening, access to fitness facilities, support for lifestyle changes, tools for stress management, financial planning resources or elder and child-care referrals. What’s important is to focus on the services that will make a difference to employees and, ultimately, to business success.

Well employees are confident, motivated and enthusiastic. You can’t buy that competitive edge at any price.

Jacqueline Taggart is a principal in the communications practice of the Toronto office of Morneau Sobeco. She can be contacted at (416) 385-2119 or jtaggart@morneausobeco.com. Jamie Farrell is a consultant in the corporate accounts practice of the Toronto office of Morneau Sobeco. He can be contacted at (416) 445-2700 or jfarrell@morneausobeco.com.

Add Comment

  • *
  • *
  • *
  • *