The Business Case for Wellness Programs

Considering a wellness program for your organization this year? Research has shown important links between employee job satisfaction, health and productivity, customer satisfaction, and a solid return on investment — ultimately the bottom line. If you have a wellness program in place already for your employees, super! There are ways to assess the costs and outcomes of your efforts, as well as to convince management that spending money will benefit the bottom line (see “Measuring Success” and “Making the Case to Management” below). If you haven’t invested in the health of your employees yet, consider this: Health issues are costly to employers: • Employees with four lifestyle risk factors are absent over 50% more often than those without risk factors, and cost two to three times more in health costs. • Employers pay an extra $488/year for every sedentary employee. Companies that invest in the health of their employees, on the other hand, increase their company profile. This helps to attract and retain high-calibre employees, according to Kingston, Frontenac and Lennox & Addington (KFL&A) Public Health. They also protect themselves from liability due to hazards caused by stress, injury and accidents, and have satisfied customers because healthy employees are more satisfied with their work and are more productive. Benefits over the short term, according to KFL&A Public Health can include: • Positive changes in three to six months • Increased job satisfaction within one year • Decreased health costs in three to five years. In a recent survey of 667 Canadian employers, 97% of respondents agree that employee health is directly related to corporate success -- no doubt an encouraging outcome. The 2011 Buffet National Wellness survey, conducted by Buffett & Company Worksite Wellness (acquired by Sun Life in 2011), provides an up-to-date “snapshot” of how public, private and non-profit organizations are supporting the health and wellness of their employees. So what is the most serious wellness issue facing employees today? According to the survey results, Canadian employers consider work-related stress to be the most important health risk facing the employees in their organizations (56% of respondents), followed closely by smoking (35%), mental health issues (35%), and high blood pressure (35%). The concern regarding work-related stress presents an opportunity for organizations to make a large impact on employee health and associated bottom-line outcomes, says Lori Casselman, Assistant Vice-President of Health & Wellness Group Benefits at Sun Life Financial in Toronto. Do wellness programs work? Absolutely, she says. “According to the survey, organizations with highly effective workplace wellness programs have performed more than 55% better than their industry peers, achieved higher average revenue per employee, and experienced fewer incidences of absences and disability, less total turnover and lower annual medical costs.” Stressed employees are also the most likely to rate their health as poor and spend more on prescription medications, in addition to elevating absence costs by up to 19%, disability costs by up to 30% and turnover costs by up to 40%, according to the survey. Trends in wellness programs One of the biggest trends in wellness programs is health coaching, according to Casselman. “There is much more of a focus now on what employees can do following health screening programs, and follow-up support is provided,” she says. “There is also a greater emphasis on the importance of employee engagement, along with smaller changes, such as policies for healthy snacks and refreshments at meetings that can be implemented to create a culture of a healthy workplace without the expense.” Finally, environmental health and healthy work environments are also becoming a top priority for employers. How do you get employees on board with wellness initiatives? Using incentives to drive participation can work, claims Casselman, and this is becoming another hot trend in workplaces. Yet many companies fail to take the important step of asking employees what they want and what meets their needs in a wellness initiative, according to the LinkedIn U.S.-based group Wellness is a Business Strategy. Feedback from the group has been that employees value “minimal time spent on wellness”, and wellness programs that do not interfere with work. Since time is such a valuable commodity, some group members are certain the next trend in wellness will be employees who are able to incorporate work with wellness through new technological devices, such as wearable sensors and 3D wearable devices that can use body movements to steer digital input. According to Bill McPeck, Director of Employee Health and Safety for the Maine State Government, the latest trends in wellness programs include social media tools, as well as an “increasing recognition that employers need to address family wellness as well as employee wellness”. McPeck claims that more and more employers are jumping on the wellness bus without having a clear understanding about how to best accomplish what they want to achieve. To take a lead from companies that have successfully implemented wellness programs, employers can follow the example of companies in the U.S., where wellness initiatives have taken off, and specifically those that have received awards for developing successful wellness programs. One example of such is the Well Workplace Award by the Wellness Councils of America (WELCOA), or the C. Everett Koop National Health Award, in which employers have wellness programs that measurably change behaviours and reduce health risks, as well as generate cost savings. Corporate Health and Productivity Management (CHPM) is another award and is given by the Institute for Health and Productivity Management. To receive this award an employer must show a corporate commitment to employee health as well as program innovation and documented measurement of the program’s impact. Measuring Success Measuring the results of wellness programs is “very important for employers”. Yet only 31% of organizations calculate a return on investment, according to the wellness survey. Incidentally, researchers from Harvard University have recently looked more closely at the ROIs of wellness programs. In a February 2010 meta-analysis on workplace wellness programs from Harvard researchers found that medical costs fall by about $3.27 for every dollar spent on wellness programs and that absenteeism costs fall by about $2.73 for every dollar spent. Sun Life is currently partnering with the Richard Ivey School of Business to look at the return on investment, and they will begin to see results of the three-year study in the first quarter of 2012. “Typically, the U.S. has been leading in the area of wellness and much more able to capture data because of its health-care system,” says Casselman. Ideally, employers should gather baseline data about employee absenteeism, turnover, performance and benefit costs to give organizations an evidence-based approach to allow them to assess which initiatives are most worthwhile, advises Catherine Connelly, Associate Professor, DeGroote School of Business at McMaster University in Hamilton in the Buffet wellness survey overview. If this seems overwhelming, one strategy is for organizations to focus on one area of measurement, such as engagement scores, absences and employee benefits. The success of your wellness strategy should not be based solely on financial outcomes, but rather a broader overview of success, experts recommend. Making the Case to Management One of the best ways to get support for a wellness program and to get management on board is to get stakeholders involved in the planning and promotion of programs. If there is a workforce with multiple locations, ensure there are stakeholders and representatives who are coming to the table and who are directly engaged. “Peer promotion and communicating with employees is key, not just from management or one specific leader,” Casselman says. She also advises to be sensitive about the sharing of personal information within a program.

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