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Does an Investment in Corporate Wellness Pay Off?

Every year, employers spend $2 billion on wellness programmes. This is according to market researcher IBISWorld, which doesn’t even take into account the cost of corporate wellness plans that companies develop in-house. That’s a lot of cash to stake on your employee’s, and your business’, wellbeing, but the real question is; does it pay off?

The short answer is, experts still don’t know. Some studies have suggested that, for every dollar spent on wellness programmes, companies save three dollars or more in savings. However, most of this research is done by comparing workers who participate with those who don’t, and do not account for their different levels of motivation. A Rand Corp. analysis last year concluded that the evidence is insufficient ‘to definitively assess the impact of workplace wellness on health outcomes and cost.’

Plus there’s a side to corporate wellness programmes which implies that the employee’s wellbeing is not the greatest concern to companies, but rather the cost of their care. Under the Affordable Care Act, companies may charge workers premiums of up to 30% more if they don’t meet certain health goals, and Alan Balch, vice president of the Preventive Health Partnership, an alliance of the American Cancer Society, the American Diabetes Association, and the American Heart Association, argues that this could keep the sickest workers from affording the care they need. He asserts, ‘If it becomes a tool for shifting health-care costs, you might undermine the whole idea of workplace wellness.’

Yet, HR professionals are convinced that properly designed corporate wellness programmes save money. According to Bruce Elliott, manager of compensation and benefits at the Society for Human Resource Management, ‘It’s an investment, and it’s an investment that does take some time.’ He notes that helping your employees to quit smoking or unhealthy diets will save you money over three to five years, but you shouldn’t use penalties to try to coerce workers to change their behaviour. ‘The one thing that does worry me is the utter lack of metrics and really, the utter lack of thought,’ Elliott says. ‘We’re now more at a herd mentality.’

Jeffrey Harris, director of the Health Promotion Research Centre at the University of Washington, adds that deep changes to the workplace are needed, rather than just starting up a wellness programme. He says that the workplace metamorphosis needed ‘is hard, and it’s hard to outsource that to an outside firm, so most companies don’t try.’ Harris suggests that companies who lavish employees with free snacks could be adding to worker obesity, commenting, ‘Strongly consider whether you want to try to change the culture around a place by removing the bowl of Hershey’s Kisses.’

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This entry was posted on July 9, 2013 by and tagged , , .
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