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Employee Wellness Programs Gaining Popularity

Authors

Eileen Koutnik-Fotopoulos

In an environment of soaring healthcare expenditures, workplace disease prevention and wellness programs to promote healthy behaviors and lifestyles and lower costs are crucial. Implementation of employee-based wellness programs is gaining momentum, particularly due to the passage of the Patient Protection and Affordable Care Act (ACA).

A provision of the ACA encourages employers to offer wellness programs to employees and to expand any existing programs. One component of the ACA is grants to assist small businesses with providing comprehensive workplace wellness programs. From 2011 to 2015, the ACA provides $200 million in grant funds to assist small employers with the implementation of wellness programs. Small employers are defined as those with fewer than 100 employees working ≥25 hours per week and who did not already offer a wellness program when the ACA was passed. To be eligible, employers must provide access to a comprehensive workplace wellness program to all employees and include 4 components: (1) health awareness initiatives; (2) employee engagement efforts; (3) initiatives to change unhealthy behaviors and lifestyle choices; and (4) a supportive environment.

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In addition to these grants, the ACA directs the Centers for Disease Control and Prevention to provide employers with technical assistance, consultation, tools, and resources to evaluate wellness programs. Another provision of the ACA increases health insurance premium discounts an employer can extend to employees who participate in wellness programs; the discount can be up to 30%.

Impact of Wellness Programs
With the growing popularity of wellness initiatives and provisions under the ACA encouraging options, there is a need to both effectively implement and measure program success. A 2013 Aflac WorkForces Report that examined trends and attitudes among benefits decision-makers and employees across the United States found that 44% of the nation’s companies boast company-sponsored wellness programs compared with 30% in 2011. The majority of these are large companies with more than 100 employees. Programs include a combination of components, such as wellness screenings (Figure).

RAND Corporation’s recent Workplace Wellness Programs Study, which was mandated under the ACA, found that wellness programs are popular among employers. Approximately half of all US employers (≥50 employees) offer wellness promotion initiatives, and larger employers are more likely to have more complex programs. Programs often include wellness screening activities to identify health risks and interventions to reduce risks and promote healthy lifestyles. Of employers offering a wellness program, 72% characterize their wellness program as a combination of screening activities and interventions.

A Kaiser Health Tracking Poll also measured worksite wellness. The survey found that the majority of the general public (76%) are amenable to employers offering wellness programs to promote healthy behaviors, while 62% do not think it is appropriate for employers to charge workers higher health insurance premiums for not participating in these programs. Additionally, an even larger majority (74%) is opposed to the idea of employers tying workers’ health insurance premiums to their ability to meet certain health goals. Almost half of working-age individuals (48%) with employer-provided health insurance said their employers offer some type of wellness program.

Transforming Healthcare
Cambia Health Solutions, a nonprofit health insurance company in the Pacific Northwest, invests in companies that will dramatically transform healthcare to be more person-centric and economically sustainable. “What often changes lifestyles the most are businesses that come forward with innovative solutions that create fundamental change in industries and marketplaces. That is what Cambia’s cause is about in transforming healthcare,” said Dudley Slater, president of direct health solutions, Cambia, in an interview with First Report Managed Care.

Cambia has long recognized the value of employee-based wellness programs throughout its health plan subsidiaries. Cambia invested in the wellness company hubbub health, which was founded in 2011. One of the company’s most exciting programs is the technology-driven wellness solution hubbub (www.hubbubhealth.com). The idea for hubbub came about after Cambia decided to rethink the traditional approach to corporate wellness. They asked workers what they did and did not want in a company wellness program and discovered that many workers thought wellness programs were “old school” and not relevant to their daily lives, while others did not have time to participate in traditional site-based wellness programs. Based on this information, Cambia saw an opportunity to develop more creative and engaging wellness products, which led a team under Mr. Slater’s group to develop a corporate wellness platform that motivates employees to adopt healthy behaviors through a combination of social networking and gaming.

“The hubbub platform is a terrific offering [for companies]. It is built upon gamification, and what that really means is that it is fun and versatile in a way that our data indicates drives engagement,” said Mr. Slater. “People engage with the platform, and I think that is one of the most elusive attributes in the wellness marketplace.”

So, how does hubbub work? When a company initially signs up, hubbub works with them to load their employee data. Once the data is loaded, employees can customize their own profiles and user settings. This online platform allows users to develop their own challenges or participate in ones created by other members. The site offers challenges on nutrition, exercise, weight loss, stress reduction, and more. For added support, the platform is available to family members, allowing employees to create challenges within their own families.

“We want employers to think of this as a tool to help inspire their workforce to be healthy,” Mr. Slater said.

Since its launch, Mr. Slater said they have seen significant numbers of companies joining the platform and a growing number of people becoming engaged. “From a marketed validation perspective, we feel we have the stamp of approval from the marketplace,” he said. As for hubbub’s future, Slater shared that the creative team has a 5-year product roadmap that looks to various trends.

Return on Investment (ROI)
The cost of hubbub to companies is $3 per employee, per month. “What we have observed is by making it fun through gamification, social media, and challenge opportunities, people become engaged,” he said. “This rewards employers because they see their workforce using it, and with the engagement comes healthier behaviors, [which] lowers the cost of care to employers.”

Determining the ROI can have a significant impact on implementing a wellness program. Data show that programs aimed at reducing healthcare costs, increasing productivity, decreasing absenteeism, and increasing job satisfaction is worth the investment. A comprehensive analysis of 42 studies by The Institute of Healthcare Consumerism showed that companies that implemented an effective wellness program realized significant cost reductions and financial gains, including:

• 30% reduction in worker’s compensation claims
• 28% reduction in sick days
• 26% reduction in health costs
• Average of $5.93 to $1 cost savings ratio

A 2010 study found that medical costs fall by $3.27 for every dollar spent on wellness programs and that absenteeism costs fall by about $2.73 for every dollar spent [Health Aff. 2010;29(2):304-311]. A recent meta-analysis of 51 studies of wellness programs showed a lower figure with an average return of $1.38 for every dollar invested [Am J Health Promot. 2014;28(6):347-363].

effectiveness of wellness programThe RAND report found that participating in a wellness program over 5 years is associated with lower healthcare costs and decreased healthcare use. The average annual difference is an estimated $157, but the report noted that the change is not statistically significant. While there is clear evidence for company wellness programs, the 2013 Aflac WorkForces Report found that just 3 in 10 companies (32%) that offer wellness programs are able to determine the ROI. A significant proportion of companies revealed that they are uncertain about the effectiveness of their wellness programs. The Table provides a breakdown of these findings.

Although evidence of wellness programs’ effectiveness is mixed, establishing wellness programs in the workplace can benefit both employers and employees. Corporate wellness programs can provide employers with the opportunity to promote the health and well-being of its employees, while employees can become more engaged in their healthcare decisions.—Eileen Koutnik-Fotopoulos

wellness program components

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