Most employers have wellness programs, although they vary in breadth and depth. This seems to be based on the organizational culture relative to wellness and determining if there truly is a return on investment for wellness programs.
To document ROI and value, a recent study by Health Enhancement Research Organization followed stock performance of 45 publicly traded companies identified as following best practices in employee health and wellness from 2009 to 2014. This group outperformed the S&P 500 in several areas, including the following:
- 235 percent appreciated shareholder value compared to 159 percent for S&P 500 — nearly 48 percent better;
- 16 of 24 fiscal year quarters out-performed S&P 500 — 67 percent of the time; and
- 1.97 percent dividend yield at end of study versus 1.95 percent for S&P 500.
This clearly demonstrates wellness programs’ value and ROI. While many local organizations are not publicly traded and may wonder if/how this impacts your organization, I will expand to demonstrate how/why wellness achieves this great ROI.
Wellness programs empower employees to improve their health, lowering your bottom line. Reducing expenses related to chronic disease and catastrophic care are the most common reasons to achieve the strong ROI. More than 75 percent of total U.S. health care spending is spent on chronic diseases — many of which could be prevented with exercise and nutrition.
Per the Centers for Disease Control and Prevention, nearly half of all U.S. people have at least one chronic disease and 25 percent have two or more. Employees with chronic conditions have more unplanned absences, reduced work effectiveness, increased accidents, and more disability claims — costing 400 percent more than investing in helping treat these individuals.
Employers with more comprehensive wellness programs understand the investment in a better and more detailed program ultimately helps employees by providing them better resources to manage their health care. The other option is not doing anything or having an inadequate wellness program, which pushes health care costs to employees, causing more lost time. Giving employees the resources to empower them to improve their health is the best option.
An example is an employee who came to the HFM Health and Wellness Center Servicing The Chamber of Manitowoc County members. The individual, complaining of stomach pain, was quickly diagnosed as needing emergency care, which resulted in emergency gall bladder removal surgery. Consider the savings because the employee used these low-cost health care services.
There are many examples of employees accessing health care and “saved lives” who would never have gone without employer assistance. The bottom line may be ROI; although it is also about making employees happy and engaged in your work environment, so they remain working for you.
Treating employees respectfully and generously at work directly affects their physical and mental health; and ultimately how they treat others at home, work and in our community. Let’s be part of the solution to improve this at work, home and in our community.
About the author.
David Yeghiaian is the interim vice president of strategy at Holy Family Memorial. Reach him at firstname.lastname@example.org.