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.