The current buzzword in employer circles is wellness. Companies now more than ever are offering employees various options for preventive health care and maintenance in order to keep them healthy and to motivate workers.
Some employers offer incentives such as rewards or discounted insurance rates for coverage. Some businesses are offering multiple options within their suite of health care benefits. Employers may be given services as part of an employer-paid benefits package, and many are opening up voluntary offerings to employees in an effort to maintain a healthy work force.
Regardless of your current offerings to your employees, wellness should be a key element of any health benefits plan design you offer. To not do so is to ignore the detrimental overall effects that unhealthy employees have on your bottom line. Current studies show that wellness programs work and provide a good return on investment, especially when properly implemented and when engaged by workers.
When considering your investment in human capital, you cannot afford not to have a wellness program in place.
Human capital refers to the stock of competences, knowledge and personality attributes embodied in the ability to perform labor so as to produce economic value, according to Paul Rauseo, Fox Business commentator. The success of a company depends very heavily on the productivity and work performance of its human capital, its people. The ability to function and perform at a high level consistently is greatly enhanced by employee wellness programs. Wellness programs focus on the physical well-being of employees, looking after medical requirements and ensuring personal health is a priority and in return higher productivity.
According to Advanced Benefit Strategies of Virginia, as a result of the PPACA, there is increased interest in employee wellness programs by employers striving to lower the profit-suffocating cost of offering health insurance to their employees. Health reform has clarified the incentives, both positive and penal that will be allowed by the Department of Labor. Surprisingly, there is wide latitude employers may use with incentives and penalties tied to wellness plan participation.
There is mounting evidence that wellness programs can significantly lower health costs when implemented with proper incentives. Here are five reasons:
- Although definitive studies have been difficult to quantify in the past, evidence is currently emerging that strong incentive wellness programs can significantly lower employer health care costs. The key to success lies in getting the participation of all employees. Significant financial incentives such as a $500 cash incentive for completing an evaluation, or significantly lowering contributions for participants who meet certain goals, has proven to be cost effective.
- Healthier employees are productive. With the recession still working itself out, employees are being asked to be more productive than ever, just as business owners must be more productive with the resources they have to stay competitive. Keeping your human resources (people) in top shape with preventive maintenance is a common sense way to gain an edge on the competition.
- It´s been proven that employees utilize medical care more efficiently when they have "skin in the game.” In other words, people care more about making smart choices when they have a financial stake in the outcome. Wellness programs demonstrate to employees that the employer cares about their well being and that their actions have an impact on the company. The movement toward "consumer driven" health plans with higher deductibles that give employees a greater stake in their care are perfect partners for wellness programs. Employees easily see the advantage of becoming healthier and spending less on out-of-pocket costs.
- This may seem to be common sense, but absenteeism and sick leave costs are significant, and improving the health of employees is proven to lower the rate of absenteeism. Wellness programs educate employees extensively on how to avoid illness and often provide personal health improvement strategies to engage employees on a specific level and reduce sick days for a large portion of the employee population.
- Although difficult to put a price on, employers implementing wellness programs report a surge in employee morale and loyalty to the company. When employees feel their employer is truly interested in their best interest, they tend to be loyal, hard workers in return. Reduced turnover and recruiting costs are also part of this equation, as a happier workplace results in less turnover.
Many companies that implement wellness tied to meaningful incentives are experiencing double digit decreases in health insurance costs and sick leave. Legal concerns about strong incentive-based wellness programs have been a deterrent to the adoption of programs by some companies. The Obama administration´s health reform guidance that permits and actually encourages tough requirements for wellness programs has reinvigorated the market for employer-sponsored wellness plans.
Educating your employees on the validity and importance of wellness is critical to your overall business success. When focused on providing benefits that work, make sure you include a wellness platform that augments your major medical and ancillary benefits. Providing services to your employees that help them makes you look like a superhero. Your employees may not say it out loud, but they will appreciate the fact that you are concerned for their well being. Make it so!