than 81% of Americas businesses with 50 or more employees
have some form of health promotion program the most popular being
exercise, stop-smoking classes, back care programs, and stress management.
Most employers offer wellness programs simply because they think
the benefit is worth the cost. Yet business leaders continue to
ask themselves how to control huge annual increases in health insurance
premiums and health care costs.
For many companies,
medical costs can consume half of corporate profits or more. Some
employers look to cost sharing, cost shifting, managed care plans,
risk rating, and cash-based rebates or incentives. But these methods
merely shift costs. Only worksite health promotion stands out as
the long-term answer for keeping employees well in the first place.
is health care reform that works. Results from Americas finest
companies, summarized here, are reason enough to think about an
investment in your most important asset--your employees and the
impact this investment can have on your bottom line.
Everett Medical Center, a member of the Wellness Councils of
America, in Everett, Washington, saved an estimated 3 million or
a cost-benefit ratio of 1 to 3.8 over 9 years of an outcomes-based
employee health benefit program called the Wellness
Challenge®. By offering financial incentives ($250 - $325)
to employees who meet specific organizational and employee health
initiatives the program continues to meet cost containment expectations
in the area of healthcare use, sick time, injuries, while improving
health habits and self-care practices. During the first 4 years
of the program there was a 28% average reduction in healthcare utilization
compared to nine other Providence hospitals that were used as a
saw that each dollar invested in workplace health promotion yielded
$1.42 over two years in lower absenteeism costs at Du Pont Co. (Well
Workplace Gold in Delaware). Absences from illness unrelated to
the job among 45,000 blue-collar workers dropped 14% at 41 industrial
sites where the health promotion program was offered, compared with
a 5.8% decline at 19 sites where it was not.
Corporation claims a $3.40 return for every dollar invested
in health promotion, yielding total corporate savings of $146 million
in benefits costs. Sick leave was reduced 19% during the four-year
study. In addition to improving the overall health of 36,000 employees
and retirees by reducing poor health habits and increasing good
ones, The Travelers realized cost savings by decreasing the number
of unnecessary visits to a doctor and emergency rooms. In a similar
but smaller study, members of a Travelers fitness center were absent
from work significantly fewer days than nonmembers.
Alive & Well program at Reynolds Electrical & Engineering
Company, based in Las Vegas, cost $76.24 per employee during
the two years it has been in operation. Over half of the 1,600 employees
participated (with up to 80% participation rates in the intervention
program). Participants significantly lowered cholesterol levels,
blood pressure, and weight and experienced 21% lower lifestyle-related
claim costs than non-participant. Resulting savings: $127.89 per
participant with a benefit to cost ratio of 1.68 to 1.
Coffee and Foods, a Bensenville-Illinois-based subsidiary of Sara
Lee Corporation, attributes impressive results to the success
of the companys comprehensive wellness program. Superior showed
22% fewer admissions to a hospital, 29% shorter hospital stays,
and 42% lower expenses per admission when comparing costs for this
divisions 1,200 employees with costs for other divisions.
Long-term disability costs were down by 40%. Superior Coffee and
Foods has earned WELCOAs Well Workplace Gold award.
costs per employee at $6,000, nearly twice the national average,
Union Pacific Railroad introduced the concept of personal health
management to its 28,000 employees, mostly union and blue collar,
in 19 Western and Southern states. Beginning with a modest medical
self-care initiative at an annual cost of $50 per person, the program
achieved a net savings of $1.26 million. In addition, a voluntary
program to help employees lower health risks projected a cost-benefit
ratio of 1 to 1.57 after one year. Employees in a treatment group
lowered their risk of high blood pressure (45%) and high cholesterol
(34%); others moved out of the at-risk range for weight problems
(30%); and 21% stopped smoking.
costs of high-risk Steelcase employees--those whose lifestyles
include two to four health risks such as smoking, little exercise,
overweight--are 75% higher than those of low-risk employees. But
high-risk employees at this Grand Rapids, Michigan-furniture manufacturing
company who improved their health habits through the companys
health promotion program and became low risk cut their average medical
claims in half thus lowering their medical insurance costs by an
average of $618 per year. If all high-risk employees (20% of the
total employee population) in one location changed their lifestyles
to become low risk, the projected savings could total $20 million
over three years.
at Berk-Tec, a small manufacturing company in Lancaster County Pennsylvania,
learned self-care techniques and lowered their companys health
care costs in one year. By using a self-care guide, the 938 employees
and their family members made smart medical decisions and saved
$21.67 per employee and dependent?a nearly 18% reduction in costs.
By combining reductions in doctor visits and emergency room use,
the company saved $39.06 per employee a 24.3% decrease in costs
over the previous year.
claims-based study of 72,000 people insured through 285 Wisconsin
school districts found a lower demand for medical services among
those with access to disease prevention and self-care programs.
Reductions in medical services results in savings for the Wisconsin
Education Insurance Group of as much as $4.75 for each $1 spent,
higher savings were found in the group receiving access to a 24-hour
phone-based nurse advice line, a self-care reference book, and health
Healthy Babies prenatal program delivered an average savings
of $5,000 per birth by providing expectant mothers with educational
materials and rewarding early and regular prenatal care. And 80%
of participants had normal births without complications compared
with 50% for non-participant. CIGNA is a member of the Wellness
Councils of America.
estimated to be as high as $8 million, the California Public Employees
Retirement System sent its 55,000 retirees a health risk appraisal
followed, in some cases, with individualized reports and letters
and self-care materials to encourage change and help reduce health
risks among retirees and at the same time reduce the health care
claim costs. In another study, Bank of America retirees in California
who chose the full health promotion and demand reduction program
showed a decrease in total direct and indirect costs of 11% compared
with an increase of 6.3% for those who completed only a simple health
health care claims, medical costs decreased 16% for employees in
the City of Mesa (Arizona) who participated in the comprehensive
health promotion program. The city realized a return of $3.60 for
every dollar invested in the health of city employees.
back injuries among its employees, a county in California targeted
white- and blue-collar workers, offered classes and fitness training.
As a result, there was a significant increase in employee morale,
reduced workers comp claims, medical costs and sick days related
to back injuries producing a net cost-benefit ratio of 1 to 1.79.
Wisconsin Education Insurance Group: Internal study
conducted by the OPTUM division of United Healthcare Corporation,
Bank of America: Two-year results of a randomized controlled trial
of a health promotion program in a retiree population: The Bank
of America study. James F. Fries, D.A. Bloch, Harry Harrington,
Nancy Richardson, Robert Beck. American Journal of Medicine, 1993,
vol. 94, pp. 455-462.
effect of a medical self-care program on health care utilization.
Don R. Powell, Stephanie L. Sharp, Shelley Farnell, P. Timothy Smith.
1996. In press.
A cost-benefit analysis of a California countys back injury
prevention program. L. Shi. Public Health Reports, 1993, vol. 108,
no. 2, pp. 204-211.
Employees Retirement System: Randomized controlled trial of
cost reductions from a health education program: The California
Public Employees Retirement System (PERS) Study. James F.
Fries, Harry Harrington, Robert Edwards, Louis A. Kent, Nancy Richardson.
American Journal of Health Promotion, vol. 8, no. 3, pp. 216-223.
Healthy Babies program is delivering healthier babies. National
Underwriter, Sept. 12, 1994. Stewart Beltz, Director of CIGNA Employee
Health Management, press release.
City of Mesa:
Influence of a mobile worksite health promotion program on health
care costs. S.G. Aldana, B.H. Jacobson, C.J. Harris, P.L. Kelley,
W.J. Stone. American Journal of Preventive Medicine, 1994, vol.
9, no. 6, pp. 378-382.
Du Pont: The
effects of workplace health promotion on absenteeism and employment
costs in a large industrial population. Robert L. Bertera. American
Journal of Public Health, September 1990, vol. 80, no. 9, pp. 1101-1105.
Hospital: Controlled trial of a financial incentive program as a
component of a hospital-based worksite health promotion program.
Larry Chapman. 1996. In publication. Providence General Medical
Center press release, June 19, 1995.
& Engineering Co.: Anthem Health Systems, Inc., Indianapolis,
Ind. Staying alive and well at Reynolds Electrical & Engineering
Co., Inc., 1993.
medical claim cost distributions and factors associated with high-cost
status. Louis Tze-chingYen, Dee W. Edington, Pamela Witting. Journal
of Occupational Medicine, May 1994, vol. 36, no. 5, pp. 505-515.
and Foods: Speech by Lee Ahsmann, Vice President of Human Resources,
at Well Workplace awards dinner, Worksite Wellness Council of Illinois,
A benefit-to-cost analysis of a worksite health promotion program.
Thomas Golaszewski, David Snow, Wendy Lynch, Louis Yen, Debra Solomita.
Journal of Occupational Medicine, December 1992, vol. 34, no. 12,
pp. 1164-1172. Impact of a facility-based corporate fitness program
on the number of absences from work due to illness. Wendy Lynch,
Thomas Golaszewski, Andrew Clearie, David Snow, Donald Vickery.
Journal of Occupational Medicine, 1990, vol. 32, no. 1, pp. 9-12.
Railroad: Office of the Medical Director, Union Pacific Railroad,
Omaha, Neb. Well Workplace Gold award-winning application, 1996.
C. Everett Koop Award winner, 1995.
of Health and Human Services, National Survey of Worksite Health
Promotion Activities (Office of Disease Prevention and Health Promotion),
1992. Obtain the Summary Report from the National Health Information
Center, PO Box 1133, Washington, DC 20013-1133.