The Case for Workplace Wellness Initiatives

Wellness programming means different things to different organizations. Effective wellness initiatives can be as simple as bringing bushel baskets of fresh fruit into break rooms to encourage better eating. They can be as extensive as building fitness facilities onsite or paying for obesity treatments.

A driving factor behind the push toward wellness spans organizations of all types, sizes and cultures: that is, health care expenses are spilling over the corporate belt buckle. The annual cost of medical services in the United States is increasing at seven times the rate of inflation. And the rise in medical costs is one boom pundits expect our economy to sustain.1

This trend makes it increasingly challenging for organizations to maintain current levels of insurance coverage. In 2003, health care inflation forced 65 percent of organizations to increase workers’ share of health costs.

Seventy-nine percent of large firms said they will increase workers’ share of health costs in 2004.2 But with lost benefits and increased financial burdens come lost morale and productivity.

Corporations are searching for another way. While organizations cannot control many of the supply-side elements contributing to increasing health care costs—malpractice insurance rates, the nursing shortage—they can help curb demand. That’s why efforts are being redirected from illness to wellness.

The case for Workplace Wellness Initiatives is supported by an ever growing body of evidence demonstrating the high costs associated with controllable health risks:

• One study reports that obesity raises health care costs by 36 percent and medication costs by 77 percent.
• Michigan officials estimate physical inactivity cost the state nearly $8.9 billion in 2002, a cost estimated to be largely borne by organizations through insurance premiums and lost productivity.
• The not-for-profit National Committee for Quality Assurance reports that the estimated average cost for postnatal care for women who did not receive prenatal care was $2,341 more than for women who had. And the indirect costs of unhealthful behavior can be just as high.

Information shows that healthier workers are more productive, spending more time at work and showing increased “presenteeism,” or productivity, while there. Further, healthier workers use fewer medical services. The five leading causes of death in the United States — heart disease, cancer, stroke, chronic obstructive pulmonary disease and diabetes —  are directly linked to unhealthy lifestyles. Clearly, encouraging healthful habits presents an opportunity to improve workers’ well being, reduce the need for health care services and help control costs.

Offering staff member wellness benefits — large or small — represents an intersection between corporate social responsibility and responsibility to stakeholders. Between staff member health and corporate health. It’s frequently the right thing to do for workers and organizations.

Research by Traveler’s Corp. shows a $3.40 return for each dollar invested in Workplace Wellness Programs. For many organizations, the choice to offer staff member wellness benefits is easy—one where conscience and pragmatism align.

The challenge arises in selecting the initiatives that will deliver the most impact based on trends in your workers’ health risks and medical claims costs. From large organizations to the corner deli, corporation owners welcome ways to boost productivity, reduce rates of absence and cut costs. Likewise, Workplace Wellness Initiatives can range from modest to elaborate.

In determining where to focus a corporation’s limited resources, looking at costs, benefits and best practices is a good starting point. This section profiles six aspects of wellness and explores their benefits to workers and organizations.