Global wellness strategies are neither ubiquitous nor fully established. Approximately half of the organizations surveyed have a wellness strategy, but more than two-thirds of them haven’t fully implemented their strategy.
Geographically, wellness programs are most prevalent in the United States, where 86% of employers report having them. Outside the U.S., wellness programs are 50% more likely to be offered by multinationals.
Reasons for offering wellness initiatives differ geographically as well. Canadian employers’ chief objective is to attract and retain employees. U.S. employers, on the other hand, are concerned primarily with reducing their healthcare costs—not surprising in an environment where challenges of cost control and global competitiveness have put tremendous pressure on employers to reduce the financial burden of providing health benefits. In European countries, reducing employee absences and improving productivity, morale and safety tend to be the top priorities.
Program design
Established program elements such as employee assistance programs and immunizations have been around for years, but are gaining more interest as health vendors enhance their offerings. Health risk assessments (HRAs) have achieved a strong foothold in recent years. They are especially prevalent in Europe, where 70% of employers offer them, or are planning to offer them this year.
Technology-driven tools, such as Web portals, online programs and personal health records, top the list of fastestgrowing program elements, with some geographic areas predicting 30-50% growth in these elements over the next one to three years. By increasing the degree of personalization, these tools seek to deliver greater participation and results than the one-size-fits-all efforts of early wellness initiatives.
Team activities promoting weight loss, nutrition, physical activity and smoking cessation are also growing in popularity with all employers.
Costs and incentives
Employers spend an average of $130 per employee on wellness programs each year. But these annual per-employee expenditures can range widely—from $0 to more than $500. The cost typically reflects the amount of investment in educational resources, health services, health screening, coaching, technology and employee communications. Employers expect their financial investment to be offset by economic and other benefits.
Many employers also provide incentive rewards (or penalties) intended to motivate individuals to participate in wellness programs or achieve measurable health status results. The rewards are typically financial in nature, though some employers also offer non-financial rewards, such as merchandise and vacation days.
The use of financial incentives to promote wellness is primarily a U.S. practice, reflecting a strong motivation to reduce healthcare costs. More than half of U.S. employers offer at least one financial incentive, compared to only one in four Canadian employers. The amounts of these incentives range from minimal sums to more than $500 per employee annually. On average, U.S. employers spend $95 per employee on financial incentives. Outside the U.S., the amount is approximately half that.
While the popularity of incentive rewards is growing, many employers don’t see them yet as particularly effective in changing employee behaviours. This may be because incentive rewards are a new approach and many employers are still figuring out how to utilize them most effectively.
Program effectiveness
A surprising result from the survey is the relatively low perceived success of wellness programs. According to half of the organizations surveyed, wellness initiatives have little or no impact on employees. The remaining half says their programs have a major impact on employee morale and retention. This is the case for Canadian employers, in particular. Only onethird of U.S. employers attribute a reduction in their healthcare costs to wellness initiatives.
The fact that employers continue to offer wellness programs, however, suggests their intuitive value. This remains a major motivator, even if program effectiveness proves difficult to quantify. Employers may also recognize that health and behaviour changes are likely to take multiple years to manifest as measurable savings.
Metrics
Relatively few wellness managers provide program metrics and results to stakeholders. According to the survey, only 18% of them share results with employees (surprising, as employees are the key stakeholders and beneficiaries), 13% report results to their board of directors, and a mere 3% report findings to shareholders. Despite executive management holding ultimate budget authority, only 53% of wellness managers report program metrics and results to other managers. This statistic may reflect the program facilitator’s lack of, or lack of confidence in, available data, or an inability to provide such reporting. Clearly, upward feedback would seem vital to building leadership support and paving the way for funding and organizational change.
Employer interest in workplace health has increased steadily over the past several years, with a corresponding explosion of offerings from health and wellness vendors eager to assist organizations with their objectives. The marketplace activity, along with the results of the survey, provides strong evidence that businesses are increasingly recognizing and valuing employee health for the resulting benefits to organizational success.
Top Strategic Objectives for Wellness Programs
| United States | Canada | Europe |
| Reducing healthcare costs | Attracting and retaining employees | Reducing employee absences |
| Improving worker productivity | Improving worker productivity | Improving worker morale |
| Reducing employee absences | Improving worker morale | Improving workplace safety |
What wellness managers want Building a compelling business case for a wellness program can be challenging. When a recent Buck Consultants survey asked corporate wellness managers to name their greatest success with their wellness programs, one survey respondent said it was “actually getting it approved in the first place.” But once those programs take flight, what other ambitions do wellness managers have for their programs? Here’s what some survey respondents said: 1. engage 100% of employee population 2. expand programs to spouses and communities 3. change corporate culture to support healthy lifestyles 4. develop an integrated culture of wellness where healthy activity and engagement “become second nature, part of the way we do business” 5. build a robust health portal with tightly integrated tools, services and reporting 6. have greater integration between health vendors to better serve employees 7. develop a complete health-and-productivity database for program planning and evaluation 8. have specific ROI measures “that I can believe and present with confidence to senior management” 9. have a more coordinated global program rather than “pockets of excellence” 10. make a difference in the health and happiness of employees while delivering a noticeable ROI to the company |
Barry Hall is a fellow of the Society of Actuaries and a principal with Buck Consultants, an ACS company. To order a copy of the complete report, visit www.bucksurveys.com.
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