Worksite Wellness ProgramsWorksite Wellness Programs

What began more than a decade ago as a pilot program in two locations, has now developed into a global program for Motorola. The company’s Worksite Wellness Program is run by the Global Rewards team consisting of more than 50 workers and funded by an annual grant. Programs are consistently evaluated on their ability to deliver a positive return on investment and profit the collective Motorola community. central, the program reaches more than 30,000 workers, family members and retirees. Worksite Wellness Program Features:

• The company provides free membership for active workers to Wellness Centers located at 8 American locations (retirees pay a small fee).
• Workers at locations without a Wellness Center receive $240 to help cover the expense of a membership at a qualifying fitness center.
• In 2003, the company offered flu immunizations to more than 11,000 workers, dependents and retirees at 70 onsite locations.
• Motorola holds hundreds of health education seminars each year for workers.

Worksite Wellness Program Determinations:

• Among workers who regularly used onsite Motorola Wellness Centers or an alternate fitness center the company saved $3.93 for every $1 it spent, according to data from 2000.
• Participating workers cost $6.5 million dollars less in lifestyle-related medical expenses than non-participants.
• Worksite Wellness Program participants experienced annual Medical Care cost increases of 2.5 percent, compared to 18 percent increases for non-participants.

Obesity

Obesity, one of the fastest growing epidemics in America, is the most prevalent health risk among workers. Obese individuals are at more of a risk for several chronic diseases such as congestive heart failure, type 2 diabetes, stroke and hypertension. Facts:

• The prevalence of overweight and obesity has doubled since 1980.
• Two-thirds (66.3 percent) of the population is overweight or obese (using Body Mass Index as a measure); 32.3 percent are obese.
• Obesity has roughly the same association with chronic health conditions as 20 years of aging.
• More than 20 percent of very overweight workers have low morale, almost twice that of workers of healthy weights.
• Overweight and Obesity medical claims cost around $92 billion in 2002, 9.1 percent of all American Medical Care expenditures.

Mental Illness

Often ignored or misdiagnosed, mental illness is one of the most disruptive health problems in businesses. It is unique in that its indirect costs (particularly presenteeism) are often higher than its direct medical costs. Facts:

• Approximately 20 percent of the American population is affected by mental illness during a given year, with the most common form being depression; yet in 1997, only 23 percent of American adults diagnosed with depression received treatment.
• In 2001 mental illness and substance abuse treatment cost more than $104 billion, comprising 7.6 percent of domestic Medical Care spending.
• Around 217 million days of work are lost each year due to productivity decline from mental illness and substance abuse disorders, costing $17 billion each year.
• Depression is one of the most costly workplace health problems, costing the American $43.7 billion each year, including workplace costs for absenteeism and lost productivity.

Smoking

Though smoking rates have declined slightly in the U.S. over the past ten years, smokers still make up 21.1 percent of the population. For many businesses, restrictions on smoking in facilities means a greater loss of productivity during breaks, adding to the costs of the practice. Facts:

• The American Center for Disease Control and Prevention (CDC) puts a $3,391 price tag on each employee who smokes: $1,760 in lost productivity and $1,623 in excess medical expenditures.
• Workers who smoke had about two times more lost production time (LPT) per week than workers who never smoked, a cost of $27 billion to businesses.
• An economic assessment found that a Medical Care plan’s annual cost of covering treatment to help people quit smoking ranged from $0.89 to $4.92 per smoker, whereas the annual cost of treating smoking-related disease ranged from $6 to $33 per smoker.
• The direct and indirect costs of smoking are estimated at $138 million per year.43 Finding Wealth Through Wellness 19 • Quitting smoking could lower an individual’s Medical Care costs by $960 each year.
• Secondhand smoke costs the American economy roughly $10 billion a year: $5 billion in estimated medical costs associated with secondhand smoke exposure, and another $4.6 billion in lost wages.
• From 1997-2001, cigarette smoking and exposure to tobacco smoke resulted in approximately 438,000 premature deaths in the U.S., 5.5 million years of life lost, and 92 billion dollars in productivity losses each year.
• Smokers, on average, miss 6.16 days of work per year due to sickness (including smoking related acute and chronic conditions), while people that do not smoke miss 3.86 days of work per year.
• Each smoker who successfully quits lowers the anticipated medical costs associated with heart attack and stroke by an estimated $47 in the first year and $853 during the following seven years.

Growing Medical Care costs show no signs of slowing in the near future. Hewitt projects Medical Care costs will jump another 9.9 percent in 2006, amounting to more than $11,000 per family (of which the company will absorb more than 60 percent of costs). More than nine of 10 members of senior staff see increasing Medical Care costs as a somber company issue that their company needs to address.

The current Medical Care climate represents an ideal opportunity for businesses to reevaluate their Worksite Wellness Program offerings and consider the more systemic approach of a robust Worksite Wellness Program. Despite the sizable number of businesses that claim to offer disease management or Worksite Wellness Program activities, as of 2005 only 23 percent of workers were eligible for Worksite Wellness and only 13 percent were provided access to a fitness center through work.

This is despite evidence that nearly two-thirds of workers would be open to company-offered HRAs and enrolling in programs that encourage healthier lifestyles.  Worksite Wellness are a chance for businesses to differentiate themselves from competitors by increasing productivity, cutting costs and establishing a healthier work environment that is valued by current and prospective workers.

Nearly onethird of workers polled in a 2004 study by MetLife given benefi ts as an important reason why they decided to work for their company and 38 percent said it is among the top reasons they remain at their job.  Gary Grates, global director of Edelman’s Change and Employee Program Engagement Group, notes, “The return on investment in a Worksite Wellness Program extends well beyond monetary Medical Care savings. These programs can play a vital role in creating a more engaged workplace environment where workers are aligned with company goals and objectives. Worksite Wellness can represent more than a human resources(HR) program, they can be a bold symbol of what you as a company stand for.”

To date, businesses have viewed Worksite Wellness as merely another benefit to be managed by the human resources(HR) department. Nevertheless, executives, and their businesses, would be better served by adopting a more strategic and integrated approach to Worksite Wellness .

Corporations that are able to develop Worksite Wellness based on sound assessment, work within existing regulations, and involve workers around initiatives, will reap important rewards in terms of cost savings and long-term strength.

After cost, poor employee engagement and inadequate communications and backing are listed as the greatest challenges for businesses administering any health benefit program.

By law, businesses are required to explain any benefits or explicit conditions of employment to all workers – this is called “due process,” and it usually takes the form of a packet of information that new workers are asked to review and sign during orientation or, in the case of existing workers, a brief communication during open enrollment periods.

Corporations that only take part in the minimally needed due process communication of a Worksite Wellness Program, however, do a disservice to the program and the company. Opinions about Medical Care in businesses represent one of the largest disjoins between management and workers.

In discussing the need for savings, most businesses (70 percent) believe their company effectively communicates about increasing Medical Care costs, while only 34 percent of workers feel increasing Medical Care costs effect their business’ ability to succeed.

When it comes to actions, 74 percent of businesses believe their workers ought to be held largely accountable for improving, managing and maintaining health, yet only 4 percent of businesses think that workers take part in these activities. Under the proposed rules, the four requirements to be a bona fide Worksite Wellness Program are:

• The total reward that may be given to an individual is limited. The departments invited comments on the appropriate level of the reward, suggesting that a limit of 10 percent to twenty percent of the total expense of employee-only coverage may be appropriate.
• The program must be reasonably designed to promote good health or prevent disease for individuals in the program.
• The reward must be available to all similarly situated individuals. More specifically, the program must allow any individual for whom it is unreasonably difficult due to a medical condition to meet the Worksite Wellness Program standard (or for whom it is medically inadvisable to attempt to meet the Worksite Wellness Program standard) an opportunity to satisfy a reasonable alternative standard.
• All plan materials describing the terms of the program must disclose the availability of a reasonable alternative standard.

Source: American Department of Labor Employee Benefits Security Administration

As Northwestern Memorial’s Kathryn Krivy says, “The most fundamental failure in any Worksite Wellness Program is not communicating. You need to tell people what you’re doing and why you’re doing it. You have to get workers engaged and educate them of what’s going on.”

A properly started Worksite Wellness Program is designed to save a company more money with improved participation. Nevertheless, a company must match its focus on program design with an equally strategic investment in efforts to take part workers in the initiatives.

Lay out your case – Despite widespread recognition of increasing Medical Care costs, workers remain skeptical that the issue impacts company operations. In fact, only 53 percent of workers even believe what their company communicates about the subject. Corporations need to be more candid and forthcoming about the amount they spend on Medical Care and how that relates to larger budgetary constraints and potential investments.

Says Motorola’s Saenz: “We share with workers that we have been able to maintain Motorola’s Medical Care spend trend below national average over the past decade due to their participation in our various Worksite Wellness . This transparency is necessary to keep reminding people the reasons for our actions.”

An effective strategy is to focus on the cost savings and central health benefi ts to the employee and not the company. By personalizing the information in this way, it establishes a win-win scenario rather than presenting the program as a sacrifi ce on the part of the employee.

Information ought to be presented through multiple channels, constructed in a way that makes sense to all levels of workers, and provided to workers, dependents and retirees. Make it your own – Every Worksite Wellness Program will be different, and ought to reflect the culture of a company. While program areas will be determined by analyzing employee health risks, the actual offerings ought to be shaped by the nature of the company.

Younger, more active employee communities may be attracted by different programs than an older or technicaloriented employee. Additionally, a global company with mobile workers will have different needs than a company with one central location.

As noted earlier regarding PepsiCo’s HealthRoads, one strategy is for businesses to brand their Worksite Wellness . Union Pacifi c Railroad (HealthTracks), General Motors (LifeSteps) and Caterpillar (Healthy Balance) all adopted this approach to help create recognition and a larger meaning around their efforts. Having a branded program helps workers and other stakeholders see the larger goals and objectives of the Worksite Wellness Program, rather than focusing on isolated offerings.

Say it loud, say it proud – As a potential cost-saving program, Worksite Wellness ought to be given the same executive backing and internal commitment as any comparable company effort. Corporations ought to not approach wellness as simply a preventive, financially-motivated program, but rather as an opportunity for the company to distinguish itself and become more competitive.

Jeffrey Treem, analyst, Edelman Change and Employee Program Engagement Group, says that effective communication about Worksite Wellness ought to be integrated into existing company communication channels and vehicles. “This includes executive communication to external stakeholders,” he notes, “because this sends a powerful message back to workers about the priority of the programs. Worksite Wellness ought to not be treated as merely an additional employee perk, but rather a progressive and strategic effort to lower costs and create a healthier work environment.”

Talk among yourselves – The most powerful champions of any Worksite Wellness Program will be the participants. Corporations ought to discover ways to facilitate discussions about the program among workers. This could take the form of support groups, interactive media and the sharing of success stories.

Nevertheless, since Worksite Wellness touch on potentially private health problems, it is important communication remains positive and inclusive, while not pressuring workers. Discussion of wellness problems ought to be voluntary, though businesses may consider providing incentives for those willing to contribute. Motivation and information from peers is likely to carry more credibility and significance than messages from management.

Worksite Wellness: Even in an at-will employment environment, individuals are still guarded from discrimination (including wrongful termination) by virtue of belonging to a protected class. Before beginning a Worksite Wellness Program, businesses need to be alert to the relevant legal restrictions and the potential impacts these measures can have on benefits and employee behavior programs.

Title VII of the Civil Rights Act of 1964 – Prohibits employment discrimination based on race, color, religion, sex or national origin. This means that standards and offerings need to be applied equally (or possibly proportionally) to all protected classes. In other words, if a company is offering access to gyms, it ought to be sure that men and women have equal access to facilities.

Corporations ought to also consider whether individuals who may live in areas heavily populated by one race, religion or ethnicity also have access to facilities and programs. The easiest way to address this concern is to supply onsite Worksite Wellness whenever possible. This not only ensures equal access, but according to Northwestern Memorial’s Krivy, also expands participation. Corporations must also be aware that particular health problems may disproportionately affect protected classes.

Health Risk Assessments and any incentives put in place may really should be personalized to account for non-lifestyle related differences. The Equal Pay Act of 1963 (EPA) – Protects men and women who perform substantially equal work in the same establishment from sex-based wage discrimination.

Benefits, incentives and programs need to be applied equally to men and women. A company can’t set a weight goal for men and not for women, even though a company can set health parameters by job function. The Age Discrimination in Employment Act of 1967 (ADEA) – Protects individuals who are 40 years of age or older from discrimination based on age.

Policies not only need to be available to individuals of all ages, but program goals and objectives, restrictions and incentives need to be designed with age appropriateness. While older workers (or retirees and dependents) may inherently pose a higher health risk, their actions ought to be evaluated in terms of demographically appropriate measures.

Title I and Title V of the Americans with Disabilities Act of 1990 (ADA) – Prohibits employment discrimination against qualified individuals with disabilities in the private sector, and in state and local governments.

Similar to other workplace offerings, any Worksite Wellness , such as a fitness center or health clinic, would have to make reasonable accommodations for workers with disabilities. One area of equivocation is whether obese workers qualify as disabled.

The issue is complicated because obesity is caused by several factors (genetics, environment, behavior), some of which may be out of the employee’s control. Generally, for workers to qualify for disability based on obesity, the condition must signifi cantly impair their physical or mental ability to perform their job.

This determination would need to be made by a qualifi ed physician. Although this label may affect the types of incentives and program requirements provided, it likely would not affect the central implementation of behavioral-focused initiatives. Civil Rights Act of 1991 – Provides monetary damages in cases of intentional employment discrimination.

This legislation allows individuals to sue businesses for improper treatment. Compensation can be in the form of actual damages such as lost or expected wages, compensatory damages for a position that causes public embarrassment, or even punitive damages meant to send a message to a company for egregious or habitual violations.

While these laws govern all company activities, there are even more stringent restrictions with regard to Medical Care problems. Most policies, communications and data collection regarding employee health are governed by the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Under HIPAA businesses can’t deny eligibility for benefits or charge a higher premium on the basis of:

• Health status
• Medical condition (including both physical and mental illnesses)
• Claims experience
• Receipt of medical care
• Medical history
• Genetic information
• Evidence of insurability (includes activities such as riding a motorcycle, skiing, snowmobiling and other similar pursuits)
• Disability

Nevertheless, because wellness programs may not incorporate medical treatment or be insurance related, and may instead be confined to behavioral initiatives, HIPAA’s nondiscrimination provisions do not fully apply.

To address this, in 2001 the American Department of Labor, the Internal Revenue Service and the American Department of Health and Human Services jointly issued a proposed regulation to help clarify the lawful provisions of a “bona fide Wellness Program” in the context of HIPAA’s existing language.

Although the regulation is not yet final, businesses that comply with the measure will be viewed by the government as making a good-faith effort to avert discrimination in wellness programs.

Complete Worksite Wellness are still relatively new to corporate America and the legal implications of implementation and enforcement are not fully known. By their very nature, these programs potentially expose businesses to discrimination lawsuits, disengaged workers and negative public relations.

Nevertheless, businesses that make a good-faith effort to comply with current Medical Care-related laws, discover ways to involve workers, and communicate strategically, will be able to minimize these risks while finding plenty of room to develop a creative and effective Worksite Wellness Program.

For many businesses, a smoking ban would not even apply to all workers. That is because currently 30 states and the District of Columbia prevent businesses from banning off-duty smoking.21 Additionally, 13 states prevent businesses from banning alcohol use away from work. Only six states have broad statutes that prevent businesses from prohibiting any lawful behavior.

Michigan is the only state that expressly prohibits discrimination on the basis of weight, however the cities of San Francisco and Santa Cruz, Calif., also have this provision (San Francisco makes exceptions for police offi cers, fi refi ghters and the San Francisco 49ers football team). When beginning Worksite Wellness , businesses ought to keep in mind local statutes as well as established common law.

Savings of Voluntary Worksite Wellness Program = (number of participants x savings per participant) – (expense of program) Savings of Incentive-based Worksite Wellness Program = (number of participants x savings per participant) – (expense of program + expense of incentives) Savings of Mandatory Worksite Wellness Program = (number of participants x savings per participant) – (expense of program + expense of policy-related turnover + expense of limited talent pool) Constructing Worksite Wellness Program policies in a company that employs unionized workers can pose unique challenges.

Worksite Wellness may be perceived by some unions as a condition of employment and therefore would be subject to collective bargaining between the parties. Nevertheless this postion can represent an opportunity for both groups, as a policy agreed upon between union leadership and management is likely to be received more favorably by workers.

The United Auto Workers and General Motors worked together to create and position a joint Worksite Wellness Program which has successfully reached more than 800,000 participants. (See Case Studies, UAWGeneral Motors LifeSteps Worksite Wellness Program, p.21)

Worksite Wellness: Unless specifically stated otherwise, most company-employee relationships in the U.S. are governed by the principle of at-will employment. Under this system a company, or the employee, can terminate the relationship without any needed showing of cause.

This at-will standard gives private businesses large power in governing the behavior of workers. In this environment, businesses can Finding Wealth Through Wellness 10 creatively design Worksite Wellness based upon their specifiic corporate culture.

Worksite Wellness generally take three main forms: Voluntary Worksite Wellness – The most popular form of employee Worksite Wellness Program, in most cases they are made available to workers but participation (or lack thereof) is not linked to any type of consequence.

Due to ineffective communication, often workers are either unaware of these offerings or confuse them with insurance-based healthcare. Incentive-based – Worksite Wellness based on incentives reward workers for participation in Worksite Wellness Program activities.

Incentives generally include reduced Medical Care premiums, gym membership or personalized support offerings. In these programs, employees’ behavior can be linked to a particular reward. Mandatory Worksite Wellness – Some businesses require, or ban, certain health-related actions. These can take the form of mandatory Health Risk Assessments for workers and restrictions on smoking or alcohol use.

While mandating behavior is an effective method to eliminate high-risk behavior, the cost savings must be gauged against the potential message sent to existing and prospective workers. Given that workers are already under various levels of scrutiny in the workplace, individuals may resist attempts by businesses to regulate off-duty actions.

Additionally, some workers may fi nd it diffi cult to comply, forcing businesses into the uncomfortable position of punishing an otherwise productive employee. In the short-term a mandate-based Worksite Wellness Program can lead to an increase in turnover, as workers either choose to leave or are fi red for noncompliance.

In the long-term, the policy may prevent the company from hiring an otherwise qualifi ed applicant, or may serve as a deterrent for individuals thinking of the company. Limits in recruiting, for instance, led CNN to rescind a 13-year ban on hiring smokers.

Corporations need to make sure that Worksite Wellness are aligned with the values and culture that lead company operations. If a company emphasizes trust and individual responsibility, then a mandate-based program will likely cause more dissension than it would in a company that already heavily regulates company actions.

Moreover, a work environment with a sizable disengaged population will likely have poor participation in a voluntary-based program. When calculating cost savings, businesses need to take a wider view and consider the effects on long-term employee engagement.

In 2005, Michigan-based insurance benefits provider Weyco instituted a smoking ban for all of its nearly 200 workers. Workers are subject to random testing and if they fail a mandatory breathalyzer test, they will be fi red.

It is believed that Weyco is the first company to use testing to enforce a smoking ban – most businesses ask workers to self-report behavior. Four workers (more than 2 percent of the total labor force) left Weyco as a result of the policy. A year prior to the ban the company started a $50 smoking fee, which would be waived if a employee passed a nicotine test or agreed to take a smokingcessation class.

Weyco’s president Howard Weyers reported that 20 workers quit smoking through this program.20 Workers were told they had one year before the total ban would go into effect. Under the new Worksite Wellness Program, Weyco does offer $35 a month for workers who want to use a fi tness center and another $65 a month for workers who meet fitness goals and objectives.

Steps to Developing a Worksite Wellness Program

1. Undertake a utilization assessment – While businesses can’t get health information on individual workers, insurance providers will supply businesses with reports that detail patterns and rates of employee use for things such as physician visits, hospital stays and prescription use. This information is vital for a company to set a benchmark of its current health risk status.Data from human resources(HR) can be integrated with benefits information to supply a complete picture of employees’ health-related costs. Then, businesses can determine the specific level of behavior transformation necessary to result in cost savings. The utilization assessment helps a company identify the areas in which it ought to focus its Worksite Wellness Program to reap the greatest benefits.
2. Build a company case – Once a utilization assessment is in place, businesses are able to quantify the Medical Care cost savings that will result from specific levels of lifestyle transformation and risk reduction. This can be done by setting goals and objectives in terms of reductions in identifi able insurance utilization, attendance or disability variables, or by aiming for reductions in health risks and projecting the associated cost savings.Effective estimates factor in the expense of the Worksite Wellness as well as the necessary internal marketing efforts that will surround the program. Says Betty-Jo Saenz, American Medical Care Strategy lead for Motorola, “When we started our programs, our focus was on the 20 percent of workers that made up 80 percent of the costs. We’ve discussed that, and now we’re paying attention to those who are active and Finding Wealth Through Wellness 8 keeping them healthy. Wherever you are on the continuum, there are opportunities.”
3. Develop a cross-functional wellness team – Corporations need to identify potential team members who can be champions of wellness within the company. It is important that the team is representative of the demographic and functional diversity of workers so that it can credibly address any specific needs groups may have.This team will serve as the voice and face for the Worksite Wellness Program within the company. Best practice businesses integrate members from human resources(HR), communications, company development and senior staff. Using the utilization analysis as a template, the wellness team ought to evaluate what programs would be most effective within each particular corporate culture, aligning health-risk priorities with initiatives that workers will be receptive to.
4. Build buy-in from senior staff – The most effective Worksite Wellness have backing from the highest levels of a company. Backing from management, both in words and in action, sends the message that Worksite Wellness are a priority for a company.The utilization analysis can be a powerful tool to build the company case for Worksite Wellness and convince executives that initiatives are worthy of investment and attention. Meaningful wellness-related messages are integrated into company communications and aligned with corporate objectives.
5. Develop a comprehensive Employee Program Engagement plan – The most brilliantly conceived Worksite Wellness Program is meaningless if no workers take part. Effective wellness communications emphasize both health and monetary benefits at the personal and company level.According to a 2004 survey by Towers Perrin, only 28 percent of workers say their company communicates about Medical Care problems other than cost. In addition, wellness-related information ought to be a part of existing company communications efforts and not coupled solely with benefits communications. This helps elevate the priority of Worksite Wellness and align initiatives with company objectives.

   Moreover, communications around Worksite Wellness can share personal success stories and supply company progress updates. Successful businesses not only use existing communications channels to generate discussion around activities, but also consider more interactive tools like message boards, forums, blogs and wikis. This helps personalize initiatives and allows for the sharing of best practices within the company. A lot businesses involve medical professionals to advise in the construction, communication and backing of the program.

   The use of outside authorities such as these will increase the credibility of the Worksite Wellness as well as combat skepticism from workers who may view the company’s motives as merely self-serving. Another strategy available to businesses is to brand their Worksite Wellness Program. This move can increase the visibility and acceptance of the offering.

   Branded wellness programs are most common when businesses are also promoting an external campaign around Worksite Wellness . An example of this is PepsiCo, which launched its HealthRoads Worksite Wellness Program internally along with a consumer campaign, Smart Spot, that puts special labels on healthier food and drink options.

   These efforts are more effective when they are not owned solely by the internal communications department, but rather when managers serve as leaders of, as well as take part in, Worksite Wellness within businesses. This establishes more immediate accountability and motivation.

6. Measure constantly and consistently – At every step of implementation, a Worksite Wellness Program must be able to verify its value to a company. Worksite Wellness ought to be designed to allow businesses to set benchmarks and evaluate behavior transformation. Measurement ought to consider not only quantitative health measures, but also qualitative measures of stress and employee engagement. Less than 10 percent of businesses do extensive management of medical care expense, employee health risk status or employee satisfaction with benefit offerings, and less than half of businesses do any assessment in these areas at all.16

Measurement is only useful if a company explicitly specifies what data would constitute success. Potential measures of success include:

• • Participation rates
  • Better employee engagement
  • Reduction of risk status
  • Reduction of direct health costs
  • Decreased absenteeism
  • Less disability claims

Motorola’s Saenz advises administrators of Worksite Wellness to track as many measures as possible from the start, even if management only requires one, because it is very difficult to retrieve data later. She notes that even if leadership begins by looking at participation rates, they will eventually want to know about reductions in claims and costs. Frequent assessment is the only way to build backing among management and workers.

Nearly half of businesses feel a lack of useful data is a top barrier to their ability to manage employee health, and at least 20 percent of businesses don’t know how effective existing Worksite Wellness are regarding various outcomes. Corporations ought to conduct utilization analysis each year and reevaluate Worksite Wellness Program priorities based upon changes. Additionally, progress ought to be shared with the wider business community to build backing for initiatives.

Managers and executives throughout a company are likely to backing a program that can prove increased productivity among workers. Effective Worksite Wellness are designed to be fl exible so they can respond to changes in both company goals and objectives and larger health variations.

Worksite Wellness first became popular during the economic boom of the late 1980s and early 90s. Programs featured onsite gyms and massages, and were used as recruitment tools for young workers searching for nontraditional work environments.

Nevertheless, when the tech bubble burst, so too did the willingness to spend money on perceived perks, and businesses returned to a more old-school benefit structure focused on managed healthcare. In recent years, as Medical Care costs have spiraled out of control, businesses have explored the potential of Worksite Wellness as a cost-saving strategy.

Corporations such as Johnson and Johnson, General Motors, Motorola and Union Pacifi c Railroad have all seen a signifi cant return on investments in employee health (See Case Studies, p.20). Worksite Wellness can help lower the costs associated with:

Medical Care premiums – The expense a company pays for health insurance: According to a 2005 study by Hewitt, the Medical Care expense per employee in the American in 2006 will average $8,046, with businesses absorbing nearly two-thirds of that expense.

Pharmaceutical costs – The price of a prescription plan: According to a 2005 study by Mercer, the average annual prescription costs for sizable businesses grew 11.5 percent, making it nearly a decade straight of double-digit increases in cost.

Short-term disability (STD) – The cost of offering short-term disability insurance to workers: According to a 2004 study by insurance provider Cigna, the average short-term disability claim results in $13,094 in direct disability payments and medical costs. The report also found that 26 percent of claims related to medical events were a result of chronic conditions that could likely be mediated through Worksite Wellness , and that these cases amount for 56 percent of the STD-related medical costs.

Absenteeism — The cost of missed work: Absenteeism cost businesses $660 per employee in 2004, with nearly one-third of businesses characterizing the trend as a somber issue.

Presenteeism — The cost associated with workers who work at decreased productivity levels: Sixty percent of the total cost of employee illnesses come from presenteeism, according to a 2004 study by the Institute for Health and Productivity Studies at Cornell University.

The evidence is clear that strategically designed Worksite Wellness can lower both direct and indirect Medical Care costs. A 2004 review of Worksite Wellness revealed that, in total, an investment of $1 by a company in Wellness Programming returned a median cost savings of $2.05 to $4.64.

Employee Program Engagement is the level at which workers are aligned with and working toward company goals and objectives. Employee Program Engagement is persuaded by a wide range of factors that include internal communications, company structure, benefits and recognition.

Corporations that have high levels of employee engagement profit from improved productivity, retention and execution than peers with disengaged workers. Levels of engagement among workers in the U.S. have been declining over the past decade as individuals have become disillusioned with the treatment of workers by businesses.

The inability to involve workers is one of the reasons why, despite steady increases in hours worked, America lags behind several other nations in terms of employee productivity per hours worked. Worksite Wellness may increase employee engagement in several ways.

First, when communicated properly, they verify to workers that the company cares about their well-being. This can improve retention and turnover as well as supply more of a discretionary effort from workers. During a period of significant downsizing, Motorola found a greater interest in its Worksite Wellness as managers recognized the value of providing for the health and well-being of workers.

In addition, the health improvements will cut down on absenteeism and presenteeism (when workers continue to work despite decreased productivity), allowing for more time spent at full productivity.

Lastly, healthier workers are more likely to have increased morale, which translates into a more enjoyable and more effective work environment.