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Wellness Program ROI Largely Uncharted

HNI Health Systems Consultant

WellnessProgramsEmployee health matters. Sick employees are less productive, and the costs of treating their chronic illnesses pile up.  Employers have a vested interest in helping employees live healthy lifestyles and manage their health effectively.

According to the Gallup-Healthways Wellbeing Index, obese employees with 3 or more chronic health conditions miss an average of 3.5 days of work per month, or 42 days per year [WOW!].   Obese Americans also spend approximately 36% more on health care costs and 77% more on medications than those with a healthy weight.

Quantifying wellness program ROI

So what are employers to do to keep health care costs in line when faced with numbers like this? Wellness programs are among the top cost-control strategies being implemented by employers.

Many employers have undertaken wellness initiatives.  But most fail to measure wellness program ROI.  According to the Society of Human Resources Professionals (SHRM)

• Only 23 percent of firms that offered wellness initiatives conducted an analysis to determine ROI.

• Only 28 percent conducted an analysis to determine cost savings derived from their wellness programs.

Quantifying wellness program ROI is no doubt challenging.  One of the biggest barriers to do so is isolating the impact of wellness programs on health care costs.  Even if a population’s health metrics are improving, it is difficult to pinpoint the source of that success. 

Insufficient data, not enough staffing, and time constraints are also certainly barriers to measuring wellness program success.

Do wellness programs have a positive ROI?

While most companies do not specifically measure wellness program ROI, most who invest time, people, and resources in such programs are still reporting them as successful. They often see improved productivity, reduced absenteeism, and lower health care costs but it's difficult to determine which portion of that is due to wellness efforts.  Companies may also report intangible benefits such as improved engagement or a happier workforce that are even more difficult to quantify.

Establishing wellness programs is the first step for employers in controlling health care costs. Examining effectiveness — determining wellness program ROI — will provide even greater benefits for employees and a firm’s bottom line.

We will be revisiting the topic of wellness program ROI in future blogs.  But first, we want to hear from you.  Where have you been successful at measuring ROI or quantifying impact?  What are you currently measuring in your wellness program?

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Topics: Construction Transportation Manufacturing HR / Employee Benefits