Wellness plans are often viewed as an ‘extra,’ not a necessity. But with tax incentives and grants under recent federal healthcare legislation, US companies have the opportunity to decrease ever-expanding healthcare costs, which are only increasing with an aging workforce. Not only does a wellness plan save money, but healthy employees will stay with your company.

A study by the National Business Group on Health shows organizations that have effective wellness plans report lower voluntary attrition, at 9 percent vs. 15 percent for those without. Additionally, the Centers for Disease Control (CDC) tells us that 75 percent of all medical expenses can be attributed to negative lifestyle habits leading to chronic disease (diabetes, heart disease, cancer) and they are potentially preventable or avoidable altogether. Implementing wellness plans can help your employees stay healthier and help everyone avoid some of these costs.

Wellness Plan Rationale: Positive Outcomes for All

Wellness plans naturally have a positive impact for the health of the individuals involved, but they also have a positive bottom-line impact for the employers that implement them. In a recent BLR webinar, Emily Richards outlined some of the positive outcomes for both employers and employees.

Positive outcomes for employers include:

• Lower healthcare and disability costs.
• Enhanced employee productivity. "When you have healthier, happier employees, their productivity rate increases without much effort." Richards said.
• Reduced employee absenteeism.
• Decreased rates of illness and injuries.
• Decrease in workers’ compensation claims. "When you have healthier individuals, the likelihood of injury goes down significantly." Richards explained.
• Improved employee morale.
• Improved employee recruitment and retention.
• Increased organizational commitment and creation of a culture of health.

Positive outcomes for employees include:

• Improved health.
• Increased well-being, self-image, and self-esteem.
• Improved coping skills with stress or other factors affecting health.
• A safer and more supportive work environment.
• Lower costs for acute health issues.
• Lower out-of-pocket costs for health care services (e.g. reduced premiums, deductibles, or co-payments).
• Increased access to health promotion resources and social support.
• Improved job satisfaction.

Measuring Wellness Plans: What is the Return on Investment (ROI)?

Despite all of these benefits, when you’re creating a wellness program, you still must be able to prove the cost savings. To measure the ROI, you will need a comprehensive program to apply to all employees – both healthy and at-risk employees. You will need to establish the appropriate measurements and then track these measurements at regularly-scheduled intervals.

Examples of metrics to measure:

• Aggregate weight and weight lost
• Average BMI
• Number of biometric screening participants
• Average number of times employees exercised per week
• Wellness event attendance/participation
• Number of group exercise participants
• Average daily caloric intake
• Yearly average blood pressure values
• Yearly average cholesterol levels
• Yearly average blood glucose levels
• Average stress level at work (these types of measurements are measured on a scale, for example from 1 to 10, as reported by employees)
• Average general stress level
• Average satisfaction/sense of purpose in workplace
• Sense of connectivity in the workplace
• Retention/turnover rate
• Biometric screening results
• Number of sick days taken (absenteeism)
• Cost of insurance claims
• Cost of workers’ compensation claims

When you look at these figures at the aggregate level, how much did the needle move? Movements toward a healthier workforce translate directly to savings in insurance claim costs and to increased productivity.

For more information on implementing wellness plans and measuring their effectiveness, order the webinar recording of "Wellness Programs: Manage Activity, Reduce Costs, and Boost Participation." To register for a future webinar, visit http://catalog.blr.com/audio.

Emily Richards, founder and president of Sade Clarity, oversees business development, directs creative initiatives, and formulates the strategy for Sade’s client base. A fitness guru, marathon runner, and self-proclaimed health nut, Ms. Richards embraces the importance of a life balance in body, mind, and spirit.