Thousands of businesses spend millions of dollars on wellness programs, but is it money well spent? Do wellness programs provide a return on the investment? To find the answer to this question one must first consider how the ROI of any wellness program should be measured.
Combining Lifestyle and Disease Control in one Wellness Package
In a study from Rand, Do Workplace Wellness Programs Save Employers Money? Their answer was yes…but. Lifestyle programs, which are how most people define wellness programs, had little or no direct health care savings (notice I said direct). Lifestyle programs include weight loss, smoking cessation, and physical conditioning.
On the other hand, disease control wellness initiatives saved $136 per participant accounting for a 30% reduction in corporate health care costs. Disease control targets employees with existing chronic conditions such as diabetes, high blood pressure, or depression, and then offers consultation, reminders, and best practices.
Driven by disease control and aided by lifestyle wellness, the ROI of wellness programs is measurable. Up to 50% of insurance claims are avoidable. The combination of lifestyle and disease control programs, as well as education, can be the vehicle to reduce claims. Consider this; eliminating 25 emergency room visits saves a corporation approximately $50,000.
What Do Lifestyle Wellness Initiatives Bring to the Table?
Measuring the ROI of lifestyle wellness programs is not as straight forward as disease control plans. There is little or no direct health care savings. However, there is a direct correlation to employee engagement that can be attributed to lifestyle programs and that can be measured.
In the Gallup poll, How Employee Engagement Drives Growth the effect of employee engagement on an organization’s bottom line was calculated. Employees with a sense of wellbeing at work paid off to employers in the following ways:
- Reduced absenteeism, as well as improved presentism
- Higher level performance with increased production and fewer product defects
- Improved employee retention
- Reduced workers compensation claims
- Fewer safety incidents
- Lower shrinkage
Do Lifestyle Wellness Plans Engage Employees?
The question becomes, do lifestyle wellness programs work? If in fact, these programs engage employees then the answer is yes as outlined in the Gallop poll above. However, where’s the proof that lifestyle initiatives engage employees? The proof is available, all you have to do is google it, but I’m not going to quote and link to one more study. I’m going to share from personal experience.
At TKO Graphix, our HR team, partnered with our insurance carrier, administrates both lifestyle and disease control programs, and we have a wellness committee. In February the wellness committee concentrated on smoking cessation. A number of employees have since quit tobacco, and that will lead to a direct cost saving in our benefits plan, but what might be more important is that employees were engaged. Teammates, who had previously quit tobacco, reached out and helped those attempting to break the habit, Knockout Smoking.
In March we began another weight loss initiative, Thin it to Win it. And once again employees were engaged. One of the side effects of programs such as this is silo busting, How to Tear Down the Walls of Silo Thinking. Bringing teammates together from multiple departments, in a group effort, is a great way to get to know each other, and that improves workplace communication and performance.
So, What is the ROI of Wellness Programs?
The ROI of a wellness plan is measurable. Insurance and health savings from disease control programs are significant and can be directly measured. At the same time, lifestyle initiatives also have an ROI. The return may not be direct, it might not immediately lower insurance premiums, but it is real. Engaging employees through lifestyle programs reduces employee turnover, increases productivity, and improves the product, and that can be counted in dollars and cents.