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CCH® BENEFITS — 02/10/10

Employers Committed To Employee Health And Wellness Programs: NBGH

from Spencer’s Benefits Reports: Most midsize and large companies in the United States are strongly committed to continuing to invest in health improvement programs for their employees in 2010, according to a recent survey from Fidelity Investments and the National Business Group on Health (NBGH). Fidelity and the NBGH conducted the survey, which includes online responses from 121 firms between Sept. 11 and Oct. 5, 2009. The survey results reveal employers’ strong commitment to health improvement programs for their employees, regardless of any health care reform changes in Washington (91% expressed such support).

Employer annual per-employee spending on health improvement and wellness programs averages 2% of employers’ total spending for medical claims, Fidelity and the NBGH found. The 2% figure excludes costs associated with employee incentives, onsite health centers, and human resources staff dedicated to wellness programs, they explained. Most employers have implemented an average of 21 programs focused on prevention, lifestyle wellness, medical condition management, and communication and education. Half (51%) of all employers planned to implement at least one additional health improvement program in 2010, and 89% expected to maintain the current programs they offer.

ROI And Measurement

The study revealed that six out of ten companies with health improvement programs do not know their return on investment (ROI) across all of their programs. In fact, companies ranked outcome measurement as their number one challenge, followed by employee engagement and participation. More than one in four (27%) companies, however, do not measure the outcomes of these programs, and 65% of companies have no measurable goals for their initiatives.

“Wellness programs are now a standard workplace benefit, as employers recognize the need to invest in initiatives that help employees to better manage their health given that health care costs continue to soar,” said Sunit Patel, senior vice president of Fidelity’s consulting services business, which commissioned the study with the NBGH. “However, when it comes to measurement, wellness programs are in their infancy. Most employers need help establishing clear program goals and measuring the impact these programs have on the overall well-being and productivity of their employees.”

“Offering wellness programs and encouraging employees to maintain healthy lifestyles can be enormously beneficial to any organization, as well as to its workers,” said Helen Darling, NBGH president. “Employers, however, won’t see meaningful results from these programs unless they effectively communicate information about them to employees and provide incentives that will motivate employees to participate and focus on taking the necessary steps to improve their own health.”

In order to encourage participation in wellness programs, more than half (57%) of the surveyed companies said that they use incentives with a cash value. The most common incentives offered are to reduce the employee’s health care premium, followed by cash and contributions to a health reimbursement arrangement or a health savings account. One out of five companies (20%) spends more than $400 per employee per year on incentives alone. Nearly one-third (29%) spend less than $100 per employee.

Prevention And Treatment

Companies are spending nearly the same amount of money on prevention and wellness programs (45%) as on programs to manage conditions after the onset of disease or illness (43%). The most prevalent programs in the prevention and wellness categories are worksite flu shots (90% of companies offer them), preventive care reminders related to screenings or annual exams (68%), employee assistance programs (92%), stress management (68%), and smoking cessation (66%). The top condition-management programs used are telephone hotlines where nurses are available to answer questions (79%); diabetes disease management (74%); and coronary artery disease, congestive heart failure, and asthma disease management (69%).

For further information, visit http://www.businessgrouphealth.org.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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