1. | 20 | JANUARY 2014
healthcare costs wellness programs employee assistance programs
HR NEWS MAGAZINE
A
lthough wellness programs are gaining in popularity, some
recent evidence calls into question their effectiveness.
According to a 2013 Rand Corporation report, although 92
percent of employers with over 200 employees offer some sort of
wellness program, most are plagued with low levels of participation,
averaging less than 25 percent and fail to produce significant ROI.
Why do so many wellness programs fail to reach their potential?
First, there is an issue of definition – what defines a true “wellness
program.” Not all “wellness programs” are created equal, and every
effort to promote health in the workplace, while laudable, is not
guaranteed to produce measurable results. Some organizations
experience significant cost savings and engagement through their
programs. Others, well, not so much. But all are included in
statistics that, unfortunately, tend to support the notion that
investing in employee health may not be worthwhile.
One way to distinguish between successful programs and
unsuccessful initiatives is through the concept of Wellness 1.0 versus
Wellness 2.0 Programs that fit the definition of Wellness 1.0 tend to
offer activities in an inconsistent, piecemeal manner. These are your
gym reimbursements or lunch-and-learns that
only attract a small percentage of the workforce. Employees are
expected to improve their health without any real accountability,
established benchmarks and limited incentives. Such initiatives are
viewed as a fringe employee benefit, not an ingrained part of
corporate culture.
Alternatively, Wellness 2.0 programs are culturally-focused, tied to
significant incentivizes and constantly measured to promote
accountability. They are strategically designed and administered as
part of the organization’s vision and values, and consistently deliver
what it’s supposed to –containment of health-related costs (both
direct and the indirect costs, such as absenteeism) and more
productive employees.
This article will describe the six defining principles of a top-
performing Wellness 2.0 program. While adopting these six
principles may be difficult, and won’t produce overnight success,
their presence in your wellness initiative guarantees that your
organization is among the elite.
By Victor Adefuye, Esq.
WELLNESS 2.0
The Six
Principles
of Top
Performing
Wellness
Programs
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healthcare costs wellness programs employee assistance programs
WELLNESS 2.0 PRINCIPLE I:
Strategic Planning
You can’t know where you’re going unless you know where you are.
Therefore, to institute a successful wellness program, it is necessary
to take a step back and assess your organization’s needs. This is the
principle of strategic planning and it is crucial to the success of any
program.
Here is a brief overview of the critical steps involved in Strategic
Planning:
1. Evaluate Population Health. Health Risks Assessments and
biometric screenings can identify employee health problems and
risk factors, and provide targets for improvement. When viewed
in aggregate, they provide a snapshot of your organization’s
health profile. It is important to work with a third party vendor
to collect and review such personal health data. This prevents
the employer from reviewing individual health information,
which builds trust with employees and ensures compliance with
various state and federal privacy laws.
2. Determine Individual Needs and Interests of Employees. In
addition to evaluating workforce health, it is important to assess
the opinions of employees regarding their work experience and
the types of wellness activities that should be offered. This is
accomplished through conducting Employee Interest Surveys.
By involving employees in the design and implementation of
the wellness program, and showing that their opinions matter,
you are more likely to ensure engagement, enthusiasm and
participation.
3. Review Workforce Policies and Environment Regarding Health.
The culture and environment of a worksite can have a major
impact on employee behaviors and health. The goal of such an
evaluation is to make the healthy choice the easy choice for
employees, and all policies and practices that frustrate this
objective must be heavily scrutinized.
4. Determine Wellness Goals. After reviewing collected data, a
clearly defined and realistic set of goals for the program should
be established. Ask yourself: why are we establishing this
wellness program, and how will we know whether we’re
successful? Is the objective to improve employee health by
reducing the number of people with certain risk factors? Is the
goal to improve employee morale and engagement or reduce
absenteeism? Perhaps you’d like to decrease the number of
employees reporting workplace stress. The success or failure of
the program should be judged by the organization’s ability to
achieve these goals within a specific time period. By setting and
prioritizing specific goals and objectives for your organization,
the wellness program design will be more focused.
Importantly, the planning process should include as much
employee involvement and feedback as possible. Too often,
wellness programs are designed without employee input; they are a
top-down imposition versus a bottom-up reflection of what
employees want. Thus, it should be no surprise when employees
fail to participate. One important way to include employees in
wellness planning is by creating a wellness committee. The
committee should be staffed with employees from different levels
of the organization, to provide feedback on how considered
initiatives will be received by the population. Members of the
wellness committee are also “champions” of the wellness program,
who can help encourage participation and answer questions about
the program’s objectives.
WELLNESS 2.0 PRINCIPLE II:
Incentives Tied to Benefit Plan and
Outcome-Based Incentives
Top-performing wellness programs tend to incorporate incentives
into the employee benefit plan; specifically, by linking wellness
participation and goals to employee health insurance premium
contributions. This is advisable because it establishes the
organization’s seriousness about wellness, and promotes the natural
connection between benefit costs and health. It’s also an effective
way of communicating the wellness program, since every
organization has an open enrollment period where employees focus
on health coverage. Indeed, firms who tie wellness program
engagement to employee premium contributions typically see
higher participation rates.
There are two types of wellness incentives: participatory and health
contingent. Participatory programs are those that either do not
provide a reward or do not include any conditions for obtaining a
reward that is related to a health factor. For example, a
participatory incentive may be given to an employee who engages
in a health-related event, like a health fair or seminar, or reimburses
an employee for the cost of the gym membership. As the name
suggests, the reward is linked to participation and is unrelated to
the employee’s health. Most wellness incentives are participatory.
Alternatively, the second category, “health-contingent” wellness
incentives, ties rewards to employees achieving a specified health-
related standard. In other words, to receive an incentive, an
employee is either (1) asked to perform an activity related to a
health factor, but is not required to attain or maintain a specific
health outcome (e.g., completing a walking, diet or exercise
challenge, due to the employee having a weight issue) or (2) asked
to attain or maintain a specific health outcome (such as not
smoking or achieving a certain body mass index, or BMI, based on
a biometric screening). The latter definition is usually referred to as
an “outcome-based” incentive.
Whether a participatory or health-contingent program is best for
your organization depends on your unique circumstances. Indeed, a
mix of both types of incentives is often adopted. While both
participatory and health contingent incentives can serve useful
goals, there is a growing trend towards adoption of health-
contingent models. According to a recent study by Towers Watson,
54 percent of employers currently tie incentives, like premium
payments, to tobacco use, and 26 percent do so for other biometric
CONTINUED ON PAGE 22
3. | 22 | JANUARY 2014
outcomes, like BMI, blood pressure and cholesterol. These
numbers are expected to grow to 71 percent and 68 percent,
respectively, by 2016.
WELLNESS 2.0 PRINCIPLE III:
Build a Culture of Wellness
Studies have shown that the use of extrinsic motivators alone, like
financial incentives, are not enough to create the kind of lasting
behavior change that is often required to live a healthier life. Top-
performing wellness programs seek to promote intrinsic
motivation, where employees strive for goals because they truly
desire change, not simply to get a financial reward. They
accomplish this by creating a supportive culture of health and
making wellness an ingrained part of the organization’s values and
practices.
For example, an organization may implement a policy change that
promotes wellness by encouraging employees to take regular
“stretch” breaks. Some companies also incorporate wellness
participation standards into evaluations of middle management.
Simple environmental changes can also have a big impact, such as
establishing safe walking paths, company quiet rooms or offering
healthy food options in company vending machines or the
cafeteria.
Together, these modifications to the policies and practices of an
organization establish health promotion as a norm, thereby
creating social pressures that positively impact in the decisions
employees make regarding their health.
WELLNESS 2.0 PRINCIPLE IV:
Engagement Through Technology
and Gamification
Wellness shouldn’t be viewed as an obligation imposed by the
employer against the will of employees - it should be fun and
engaging. This is reflected in the fourth principle of wellness:
technology and gamification.
Technology is increasingly impacting the field of workplace
wellness. Successful programs often leverage state-of-the-art,
interactive web-based information management and resource
platforms, telecommunications and mobile applications. These
tools benefit both the employer and employee. Mobile
technologies, for example, can expand the ability of employers to
communicate with employee populations that are highly dispersed.
For employees, wellness technology solutions make wellness more
accessible and fun, thereby increasing program participation. They
also promote health knowledge and the personalization of wellness,
by granting employees on-demand access to health risk assessment
tools and health information, and allowing them to track progress
towards their health improvement goals. Finally, the best wellness
technologies incorporate social media, allowing employees to
encourage each other along their wellness journey.
The social nature of wellness is also encouraged by gamification,
which is the use of game-like features to intrinsically motivate
behavior change. Employers incorporate gamification into their
wellness programs by organizing health competitions, like a
walking or weight loss challenge, or providing access to online
games and health quizzes. Gamification taps into the competitive
spirit and creates social pressure to participate in wellness activities.
Along with offering state of the art technology solutions, the use of
health challenges can result in greater program participation and a
feeling that wellness is fun: something the employer is doing for
employees, rather than to them.
WELLNESS 2.0 PRINCIPLE V: Wellbeing
The definition of wellness includes more than simply physical
health or the absence of disease. To work at peak performance
levels, employees must also have a strong sense of emotional,
intellectual and social wellbeing. The Gallup organization, in
collaboration with Healthways, Inc., defined wellbeing as having 6
dimensions:
Emotional health
Physical health
Work environment
Basic access
Healthy behavior
Life evaluation
Although it is impossible to expect an employer to play psychiatrist
for every employee, there are steps employers can take to encourage
this more expansive notion of wellness.
For example, to encourage wellbeing, your organization may
provide access to an EAP service, or lower co-pays for psychiatric
services. Through workforce surveys, you can measure the
reporting of stress in your population and use that information to
evaluate aspects of your culture that contribute to the problem,
while providing education on stress reduction techniques. You can
also measure job satisfaction among employees and take steps to
discover and encourage workers to use their strengths at work. As
is often noted, employees tend to quit their managers, not their
employers. Given the costs of rehiring and retraining new workers,
an employer can potentially save considerable sums by simply
tracking feedback provided by employees regarding their direct
managers and intervening before a valued employee quits. Studies
have also shown a direct link between depression and absenteeism,
with some estimating an annual cost of $23 billion a year. There
are also links between emotional health, unhealthy behaviors and
worker productivity. For example, two Gallup survey in January of
2013 found that American workers, who are engaged in their work
and workplace, are more likely than their counterparts to report
healthier lifestyles. Another survey in June of 2013 found higher
incidence of emotional distress among smokers. By embracing and
healthcare costs wellness programs employee assistance programs
HR NEWS MAGAZINE
Wellness 2.0 CONTINUED FROM PAGE 21
4. promoting all aspects of wellness, an employer can reap benefits
beyond those typically associated with the absence of disease.
WELLNESS 2.0 PRINCIPLE VI: Metrics
As the saying goes, “you can’t manage what you can’t measure.”
If the goal is to effectively manage the health of a workforce, a
constant focus on measuring and analyzing the impacts and results
of a wellness program is crucial.
There is a wealth of discussions about the difficulty of measuring
wellness ROI. Although numerous academic studies have shown a
positive return on wellness dollars, the difficulty lies in accurately
capturing the costs of a non-event, like preventing a heart attack or
stroke. Frankly, there is no way to prove definitively that an individual
who lost significant weight or lowered their cholesterol would have
developed an expensive, chronic condition. However, the link between
risk factors and chronic, expensive diseases is well established, and
there are numerous strategies that allow employers to measure the
impact of a wellness program on the health of the population.
For instance, an organization can evaluate trends in:
Levels of program participation.
Health expenses per employee.
The number of employees with specific risk factors or chronic
conditions.
The number of lost work days due to illness.
Other health-related expenses, like worker’s compensation or
disability claims.
Employee wellbeing metrics, like reported job satisfaction and
stress levels.
These factors can be studied over time (before and after the
wellness initiative), and compared to similarly-situated
organizations, to get an accurate assessment of where your
program stands.
The guiding principles described in this article are to provide a
greater understanding of the key factors necessary for a top-
performing Wellness 2.0 program. The objective is to create a
sustainable and accountable culture of wellness, thereby
maximizing your organization's likelihood of success.
Victor A. Adefuye, Esq. is an attorney and president of
WellnessRebates, LLC, a consultant to a mid-size and large employers
looking to enhance productivity and control health costs through
comprehensive, results-oriented wellness programs. For more
information, please email victor.adefuye@wellnessrebates.com,
or call (888) 208-2788. —N
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