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Saving Millions

For organizations small and large, health care expenditures make a significant impact on their bottom line and healthcare costs are only rising. In an ideal world, all employees are healthy. They have minimal healthcare associated costs, reduced payout on insurance and decreased absenteeism and productivity losses. However, in reality, common chronic diseases (diabetes, heart disease, etc.) alone in the US costs more than one trillion dollars in direct costs and indirect productivity losses.1 More and more employers are shifting over to higher deductible plans, making it extremely costly or impossible for employees to afford.2 Although this may decrease insurance payout in the short term, there may be long term consequences, such as increased turnover rate or productivity loss due to lack or improper medical care.

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Despite the bleak reality and fluctuating healthcare policies, there may be a solution to these problems in the form of healthy employees. So how does an organization improve their overall employee health? There may be a simple solution: corporate wellness programs. More and more companies are increasing their focus on corporate wellness programs as a way to target employee health and happiness. Corporate wellness programs can encourage weight loss through better diet and exercise, smoking cessation, drinking moderation, more preventative care and screenings, reducing health risks, and overall living a healthier lifestyle. Although easier said then done, corporate wellness programs can increase overall health of employees, decrease absenteeism, increase productivity, and decrease bottom line expenditures.

Implementing a corporate wellness program to achieve the outcomes outlined above can prove to be challenging for a multitude of reasons. One reason comes from the mere fact that being healthy and making healthy life choices are hard. Obesity has become an epidemic in the U.S., and millions of Americans have been on a diet before, are currently on a diet, or will be on a diet some time in the future. However, weight loss and increased activity that is sustainable can be extremely difficult to achieve. Additionally, there may be problematic approaches to the way how the employers will be able to encourage wellness programs and increase participation. The employer can offer incentives as part of the program, which may result in low participation rates, or impose penalties on those who do not participate, which may generate dissatisfaction among employees or discrimination of those with pre existing conditions.3

The solution comes from a delicate balance of both incentives and penalties. The Human Resources department should be cognizant of avoiding any discrimination that may result from the implementation of the wellness program, whether it be direct or indirect. Having a holistic and long term approach of the program is important, as it is easy to lose sight of the long term goal (healthy employees) by focusing just on the current bottom line. Having a well structured corporate wellness program that has a proven track record of success can highly increase your chances of implementing a successful corporate wellness program. For more information, please visit www.imagicalph.com or contact Will Yeaton at will@imagicalph.com, or 602-509-4023.

Healthy employees achieved through corporate wellness programs can not only save your organization millions of dollars but also may reduce the risk of diseases in your employees, saving their lives.

  1. Milken Institute, “An unhealthy America: the economic burden of chronic disease,” October 2007. (http://assets1b.milkeninstitute.org/assets/Publication/ResearchReport/PDF/chronic_disease_report.pdf)
  2. PWC Health Research Institute, “Medical Cost Trend: Behind the Numbers 2016,” June 2015. (http://www.pwc.com/us/en/health-industries/behind-the-numbers/behind-the-numbers-2016.html)
  3. Mujtaba and Cavico (2013). Corporate wellness programs: implementation challenges in the modern American workplace. International Journal of Health Policy and Management, 1(3), 193–199
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