Ever-rising Healthcare Costs can be Curtailed with Employee Wellness Programs

by: Nichole Gunn July 12, 2011

Health and wellness programs are becoming more and more essential as a front line barrack against ever-rising healthcare expenses. Business 360 reported that the Business Roundtable, which consists of CEO’s of major American businesses, stated the forecast trends show business owners healthcare expenses will go on rising throughout the next 10 years.

While the employer healthcare burden for 2009 was $10,743 per employee, studies indicate that burden will jump to $28,500 per employee by 2019. This trend has employers apprehensive and looking for strategies to curtail theses increases through corporate wellness and health reform plans.

Reinforcing these predictions, Mercer, a worldwide human resource information provider, conducted a December 2011 study revealing that employers expect an almost 12 percent jump in their healthcare costs just within this year. These employers are scrambling to redesign their existing employee wellness programs to make them more effective in efforts to help reduce the expected increase. Analyzing program designs already in place, as well as vendor costs will hopefully lower the percentage to 7.4 percent.

Another strategy that over 33 percent of the respondents have in mind is to pass some of the health benefit expenses on to the workers by: upping the out-of-pocket maximums, and increasing co-payments and deductibles. Twenty-eight percent cited plans were in effect to increase the workforce’s insurance premium contributions.

To help ease the potential extra healthcare cost burden to their employees, Midwest Metal Products, an Iowa-based company, initiated an employee wellness program in 2010; the new program consists of offering healthy lifestyle classes, revamping its vending machine contents, helping finance glyconutritional supplement costs, providing free yearly flu shots, and providing healthy lunch choices.

Realizing the importance of analysis and feedback, Midwest Metal Products conducted an in-house survey of the wellness program’s participating workers, which consists of just under 50 percent of the entire workforce. The results indicate that participating employees have an increased level of mental clarity, motivation, and energy, as well as weight loss and lower blood pressure levels.

One other example of the effectiveness of a corporate wellness employee incentive initiative is Charlevoix, a city in Michigan. In an interview with WPBN-7, Charlevoix’s HR assistant Jennifer Nash noted, “It’s about money, but it's not all about money – it's about the people, and just getting them healthier.”

The Charlevoix program, Ride a Path, consists of 42 percent of the city’s workforce and fosters eating healthy and a variety of exercise options. The incentive to employees; track their inputs into the program, such as diet changes and activities, to earn a number of awards, including massages. Time off is the top award.


About Nichole Gunn

Nichole Gunn is the VP of Marketing at Incentive Solutions, an Atlanta-based incentive company that delivers advanced, agile B2B customer loyalty and channel sales incentives programs.