Wellness programs are on the rise along with healthcare costs. Continually rising health insurance costs are due in large part to unhealthy populations from a sedentary lifestyle, obesity, stress, and tobacco and alcohol use. Employers have a vested interest in offering incentives to their employees to get and stay healthier.
Employers control healthcare costs in various ways, including downsizing their workforces to reduce the number of employees covered, eliminating comprehensive healthcare plans and offering cheaper plans with basic coverage, shifting the cost of insurance to employees, and offering wellness programs.
According to the Wellness Council of America, more than three quarters of American businesses have wellness programs like tobacco cessation classes, stress management, and exercise incentives. Businesses offer wellness benefits for recruiting and retention and to control medical insurance costs.
Research by Rand Corporation shows that lifestyle management programs offered in wellness initiatives produce long term benefits and lowered costs for healthcare. Habits like poor eating, smoking, and lack of exercise reduce or avoid conditions like pre-diabetes, cancer, and hypertension. The ratio of reductions in health care costs to the costs of offering wellness programs, even including the costs of fees and screenings, is $1.50 returned for every $1.00 spent.
Wellness programs are becoming a strategic initiative trend for 2014 according to The Institute for HealthCare Consumerism. And they are trending for reasons other than cost reduction. Employee wellness has other benefits than lower group health insurance.
Healthy employees are more productive and contribute more to business success than employees with chronic health conditions. And wellness programs help sick employees stay more productive during illness or disease and return to work faster, making them a strategic imperative for a healthy bottom line.
Other wellness program trends in 2014 include wellness programs independent of healthcare plans that ensure continuity of services even if health plans change and customizable and personalization of wellness programs for various employee population sizes and health risks.
As the value of and need for wellness programs becomes more and more important, employers are budgeting more for wellness programs. Fidelity Investments and the National Business Group on Health found employers plan to increase their incentive budgets by 15 percent in 2014, setting aside almost $600 per employee for wellness.
The Fidelity study reports that the most popular wellness programs are lifestyle management, followed closely by disease/care management programs for conditions such as diabetes, health-risk services like on-site flu shots, and environmental enhancements to encourage healthy habits such as bike racks and walking paths.
With wellness programs becoming a strategic imperative for cost reduction and employee health and engagement, they will not be going away any time soon. In fact, the signs all point to wellness programs becoming a benefits fixture even in small companies.
Contact PAYDAY for assistance in regards of wellness programs.
PAYDAY Workforce Solutions provides a single database SAAS solution for Human Capital Management (HCM) including payroll, human resources, time management, benefits administration and onboarding to companies of all sizes and in various industries.
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