Healthy Employees Cost You Less

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Since 1995, the percentage of Johnson & Johnson employees who smoke has dropped by more than two-thirds. The number who have high blood pressure or who are physically inactive also has declined—by more than half. That's great, obviously, but should it matter to managers?

Well, it turns out that a comprehensive, strategically designed investment in employees' social, mental, and physical health pays off. J&J's leaders estimate that wellness programs have cumulatively saved the company $250 million on health care costs over the past decade; from 2002 to 2008, the return was $2.71 for every dollar spent.

Corporate Wellness programs have often been viewed as an extra, not a strategic imperative. Newer evidence tells a different story. Yes! Government incentives or not, healthy employees cost you less... according to a team of researchers led by Leonard L. Berry of Texas A&M University, Ann M. Mirabito of Baylor University and William B. Baun of the University of Texas MD Anderson Cancer Center.

Their research shows that the return on investment on comprehensive, well-run employee wellness programs is impressive - sometimes as high as six to one.

The findings are compiled in a comprehensive piece in the December issue of Harvard Business Review titled "What's the Hard Return on Employee Wellness Programs?" The subhead reads, "The ROI data will surprise you, and the softer evidence may inspire you."

Wellness Wheel (Image) 

Behind the research are Berry, the Presidential Professor for Teaching Excellence who also holds the rank of Distinguished Professor of Marketing as well as the M.B. Zale Chair in Retailing and Marketing Leadership at Mays Business School, Texas A&M University; Mirabito, an assistant professor of marketing at the Hankamer School of Business, Baylor University; and Baun, manager of the wellness program at the MD Anderson Cancer Center, a director of the National Wellness Institute and a director of the International Association for Worksite Health Promotion.

Berry has spent more than 30 years studying corporate service quality, and conducted an in-depth service study of the Mayo Clinic to uncover fresh and innovative approaches to serving patients. He also serves as a Professor of Humanities in Medicine in the College of Medicine at The Texas A&M University System Health Science Center.

....even in terms of ROI - Wellness is not just a mission-it's a message.

Creating a culture of health takes passionate, persistent, and persuasive leadership at all levels-yes!

A corporate wellness program should be a natural extension of a firm's identity and aspirations.

Wellness programs must be comprehensive, engaging, and just plain excellent.

Aim to make low- or one-time or no-cost services a priority.

Of course on-site integration is essential because convenience matters.

Active, ongoing collaboration with internal and external partners can provide a real good corporate wellness program with some of its essential components and many of its desirable enhancements.

PROVEN OUTCOMES

Lower Costs

The savings on health care costs alone make for an impressive ROI. Doctors Richard Milani and Carl Lavie demonstrated that point by studying, at a single employer, a random sample of 185 workers and their spouses.

The participants were not heart patients, but they received cardiac rehabilitation and exercise training from an expert team. Of those classified as high risk when the study started (according to body fat, blood pressure, anxiety, and other measures), 57% were converted to low-risk status by the end of the six-month program.

Furthermore, medical claim costs had declined by $1,421 per participant, compared with those from the previous year. A control group showed no such improvements. The bottom line: Every dollar invested in the intervention yielded $6 in health care savings.

Greater Productivity

Participants in wellness programs are absent less often and perform better at work than their nonparticipant counterparts. In 2001 MD Anderson Cancer Center created a workers' compensation and injury care unit within its employee health and well-being department, staffed by a physician and a nurse case manager. Within six years, lost work days declined by 80% and modified-duty days by 64%. Cost savings, calculated by multiplying the reduction in lost work days by average pay rates, totaled $1.5 million; workers' comp insurance premiums declined by 50%.

Higher Morale

Most analyses of workplace wellness programs focus on hard-dollar returns: money invested versus money saved. Often overlooked is the potential to strengthen an organization's culture and to build employee pride, trust, and commitment. The inherent nature of workplace wellness-a partnership between employee and employer-requires trust. Because personal health is such an intimate issue, investment in wellness can, when executed appropriately, create deep bonds.

Yes- healthy employees stay with your company. A study by Towers Watson and the National Business Group on Health shows that organizations with highly effective wellness programs report significantly lower voluntary attrition than do those whose programs have low effectiveness (9% vs. 15%). At the software firm SAS Institute, voluntary turnover is just 4%, thanks in part to such a program; at the Biltmore tourism enterprise, the rate was 9% in 2009, down from 19% in 2005. According to Vicki Banks, Biltmore's director of benefits and compensation, "Employees who participate in our wellness programs do not leave." Nelnet, an education finance firm, asks departing employees in exit interviews what they will miss most. The number one answer: the wellness program.

Now the question is...

What is your corporate wellness strategy?

Does your company invest in employee health?

Dr Das Suman

www.realgoodsolutions.com

 


About

Dr Das Suman (Doctor-Da) is a New Age Entrepreneur, Very popular Business Profit Consultant, Innovative Fundraiser, Natural Well Science Visionary, CEO of Real Good Solutions.

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