HJAR Jan/Feb 2020

HEALTHCARE JOURNAL OF ARKANSAS I  JAN / FEB 2020 17 plethora of other options that will benefit the employee. Examples include discounted gym memberships, free counseling, group exercise activities, and social responsibility activities. Now that we have a better understanding of wellness programs, the question remains— do employer sponsored wellness programs reduce costs? Many reports say they do not. The determination of whether or not wellness programs produce savings for employers is based on two principles: employee bias and statistics.  Employee bias is based on the idea that wellness programs only appeal to those employees who are interested in personal wellbeing. For example, John enjoys jogging and tries his best to maintain a healthy diet. Therefore, when John’s employer offers a wellness program that requires him to log his weekly exercise and gives him tips on healthy food choices, John is more than happy to sign up. On the other hand, Bob does not exercise, eats a lot of fast food, and smokes a pack of cigarettes every day. Bob enjoys his lifestyle, and is not motivated to make changes in his life that include exercise, improvements in his diet, and giving up his cigarettes. Therefore, Bob does not enroll in the program. Now, let’s compare John and Bob. On average for the past ten years, John has seen his primary care physician for his annual exam and once during the spring for a common cold. John’s medical claims typically average about $400 for each visit, in addition to the cost of his generic sinus medication. Each year, John’s health insurance pays out roughly $900 in medical claims. Bob has not had an annual exam in twelve years. Three months ago, Bob was having severe chest pains that resulted in an emergency room visit, a two-day inpatient hospital stay, and a regimen of medication to control his hypertension. Last year alone, Bob’s health insurance paid out $41,000. Until Bob comes to the realization that his lifestyle needs to change, there is nothing a wellness program can do to help Bob’s employer. The failure of the statistics is simple to understand because the primary player gathering statistics is the wellness program. They are biased because they want their pro- grams to work. Asalesperson for the wellness program has to come into the employer’s of- fice and sell that employer on how the well- ness program can save them money. Sta- tistical data can be manipulated in order to bolster the wellness program’s performance and the salesperson’s point. The task of de- termining cost savings would fall upon the employer to evaluate the wellness program’s monthly or bi-monthly cost reduction. Em- ployers are busy people, and they often do not have time to evaluate a wellness program. According to a recent survey, 73 percent of employers offer a wellness program 4 . There- fore, the employers who are investing large amounts of money in wellness programs want employee engagement and participa- tion. As seen in the example of employees John and Bob, the more employees who participate, the more potential savings the employers can experience. Therefore, em- ployers are giving employees an incentive to participate in the wellness program. For ex- ample, ABC Company will give an employee a $200 gift card if he gets his annual physical from his primary care physician each year. Or, XYZ Company will pay employees $100 a quarter if they log wellness activities like blood work, annual dermatology skin exams, exercise, dental wellness exams, dieting, etc. Some companies are even punishing employ- ee wellness behavior that does not meet the requirements of the wellness program. For example, Bob is happy with his unhealthy lifestyle and decides not to get an annual physical, which is required by XYZ Compa- ny’s mandatory wellness program. Therefore, XYZ deducts $25 from Bob’s paycheck for not complying with the wellness program’s rules. Furthermore, if Bob does not comply with other rules within the wellness program, like screenings or physical activities, then he can be fined up to $300 a year 5 . Wellness programs that are put into place with poor employee communication and lit- tle to no accountability will most likely fail to provide cost savings for employers. Similarly, would a manager expect a new employee to do well if there was poor communication and no accountability for the employee’s ac- tions? Of course not. Therefore, if an em- ployer is interested in a wellness program, they should do their homework in order to choose the right wellness program vendor. Employers should choose vendors who are technologically advanced, with an emphasis on employee communication that will drive better engagement. More employee engage- ment in the wellness program can equal more cost savings. Also, an employer needs to de- cide whether he will reward good employee behavior with incentives, or punish poor behavior with loss of employee pay. If the employer chooses employee punishment, the company’s wellness rules should be fair, ethical, and non-discriminatory. Also keep in mind that employee punishment may de- crease employee morale. Employee account- ability within the wellness programwill equal more cost savings.  If you, as an employer, are undecided about whether or not your company should offer a wellness program, you should ask yourself if you have adequate management person- nel available to ensure your wellness pro- gram is successful. If you have two hundred employees and only two people within your human resource department, then a well- ness program may not be appropriate for you. However, if you have the proper staff- ing, the desire to improve your employees’ overall health, and the diligence to see the plan through, then a wellness program can potentially save your company money. n SOURCES 1 “Medical Care Priced at $1,000 in 2000 -> $1,894.22 in 2019”Historical Pricing for Medical Care in 2000 18 September 2019 2 “Early Cancer Diagnoses Saves Lives,CutsTreatment Costs”World Health Organization 3 February 2017 3 “How to Live Longer, According to Science” The Healthy 2 January 2019 4 “10 StatisticsThat Make the Case forWorkplaceWell- ness”SFMTheWork Comp Experts 15 August 2018 5 “The Scourge of Worker Wellness Programs” The New Republic 2 September 2019 Andrew Olinde, Jr. is a graduate of the University of Louisiana at Monroe with a Masters of Business Ad- ministration. He began his career in the health and wellness industry in 2008.Prior to joining the Gallagher Benefit Services’Baton Rouge office,Andrewworked as an internal sales representative at Vantage Health Plan.Andrew is a certified health insurance counselor in the state of Louisiana,and is currently pursuing the Certified Employee Benefit Specialist designation.