According to a recent Towers Watson study, 46 percent of employers are considering implementing wellness plans in the workplace, nearly four times as many as three years ago. On the surface, the idea is that healthier employees are cheaper to insure, take fewer sick days and are more productive. For employees, wellness programs can be a value add because they can mean lower out-of-pocket costs and improved health.
Some employers are going beyond encouraging fitness and an active lifestyle. An article in The Washington Post recently reported businesses are offering cash incentives for employees to improve specific health measures, including body fat, cholesterol and blood pressure.
ACHP member UPMC Health Plan conducted a five-year observational study on its own comprehensive wellness, prevention and chronic disease management program, “MyHealth,” which offers incentives in the form of annual credits to one’s health insurance deductible. The study, published by the American Journal of Preventive Medicine, found there were significant improvements in health-risk status as well as increases in the use of preventive and chronic disease management services among program participants.
The study also found a positive effect on the overall cost of health care for participants. In fact, it found “savings will accrue for the combined group of health care workers who reduce risks, primarily because of significant reductions in medical costs for those who achieve the lowest health risk levels and therefore require fewer or less expensive services than those that maintain or increase risks.”
From UPMC’s results, it would seem that employee wellness programs are beneficial not only for providers and employers, but also for enrollees because they provide cost savings and encourage healthier lifestyles.
However, not all programs are designed and implemented as successfully. According to an article in The New York Times, research shows wellness programs often do not work as advertised.
Yes, companies can save costs by implementing programs, but sometimes cost savings can stem from shifting higher costs to employees For example, an employer may offer financial benefits to employees who are not smokers and exercise regularly, and higher premiums to those who smoke or don’t exercise.
It’s important to note that the Affordable Care Act encourages wellness programs and allows employers to reward or penalize employees up to 30 percent of their annual premium for participating – or not.
While the jury is out on whether these type of programs are beneficial, UPMC research supports the idea that employee wellness plans with incentives can benefit consumers by lowering out-of-pocket expenses and encouraging healthier lifestyle choices.