Employee Wellness Program Saves Company Millions on Health Care Costs

Wellness programs are sometimes seen as a nice-to-have. They make employers happy, but do wellness program save money? A recent study shows they can have a 6 to 1 return on investment. Doctors Richard Milani and Carl Lavie reported on a single employer and a random sampling of 185 workers and their spouses, who were not cardiac patients, but received cardiac rehabilitation and exercise training from an expert team. The study reported by Harvard Business Review found:

• Fifty-seven percent were converted to low-risk status by the end of the six-month program.
• Medical claim costs declined by $1,421 per participant, compared to the previous year.
• Every dollar invested in the intervention yielded $6 in health care savings.

In 2001, MD Anderson Cancer Center created a workers’ compensation and injury care unit in the employee health and wellness department. The authors also found:

• Within six years, lost work days declined by 80 percent and modified-duty days by 64 percent.
• Cost savings totaled $1.5 million and workers’ compensation insurance premiums declined by 50 percent.

Another study by Towers Watson and the National Business Group on Health, found significantly lower voluntary attrition at organizations with highly effective wellness programs (9 vs. 5 percent).

Authors of the Harvard Business Review study identified six pillars of success for these and other effective wellness programs:

1. Multilevel Leadership – From CEOs to middle management leadership, support at all levels creates a healthy culture.
2. Alignment – Healthy cultures should be an extension of your organization’s identity. These changes should be gradual and take time to evolve and should use carrots not sticks.
3. Scope, Relevance, and Quality – Wellness programs are important and must be comprehensive and well-constructed.
4. Accessibility – Services should be convenient, on-site and low to no-cost.
5. Partnerships – Build relationships with internal and external partners.
6. Communications – How a program is perceived and how it is delivered makes a difference. Learn more about employer wellness programs and other research in the Harvard