The Economic Value of Employee Wellbeing (article)
With health care reform a reality, top-performing employers understand that pursuing the objective of healthier, happier employees is beneficial to the individual as well as the business’ bottom line. There is now a fair amount of validated research demonstrating the effectiveness of successfully implemented wellbeing programs to deliver value beyond money.
Even if a business’ medical plan is fully-insured, has a pooled group premium or is utilizing exchanges, the additional benefits to productivity, performance and the competitiveness of the business are compelling reasons to implement workforce wellbeing and engagement programs.
Improved employee health, health care cost control, increased productivity and absenteeism reduction are quantifiable goals, and their value can be monetized, allowing for a calculation of savings and an estimation of a return on investment (ROI). Yet broader motivations, including low turnover rates, attraction of top candidates, job satisfaction, and recruitment and retention of workers, are now contributing to employer commitment to wellbeing programming. This is evident in the proliferation of “best places to work” lists in major markets across the country.
Toward this end, best practices focus on modifying the environmental, cultural and lifestyle systems in the workplace that can lead to poor wellbeing, preventable health risks and unchecked costs. This is a major paradigm shift in thinking about the economic value of health and overall wellbeing. The issue is no longer whether to offer a wellbeing program but how best to implement a program that fully engages employees to return clear, measurable outcomes and a real return on this significant business investment.
As health care reforms have been introduced over the last several years, changing benefit design has been a challenge for employers and at times a potential source of stress for employees. Surveys tell us that the biggest challenge to maintaining affordable coverage is employees’ poor health habits, followed by high-cost catastrophic cases and underuse of preventive services. Clearly, there are preventive and mitigation opportunities to address these challenges. Such programs have goals to:
- increase employee education and awareness of health risks
- engage the workforce in active, healthy lifestyles
- reduce moderate and high risk prevalence in the population, specifically weight, stress, blood pressure, cholesterol, diabetes and tobacco use
- reduce medical claims expense, as well as absences, disability and worker’s comp injuries
The ‘real’ answer to these problems is to focus on improving employee wellbeing, energy and engagement. Performance will follow. Leading evidence suggests we need to go upstream to fix the system leading to the defects.
Businesses can begin to manage the wellbeing of their workforce by designating a wellbeing leader and endorsing a mission of wellbeing, then setting out to formally construct and implement the plan. The Society for Human Resource Management (SHRM) suggests a step-by-step program that includes the following actions:
- Set program goals.
- Determine the company’s level of involvement.
- Establish a budget and expected ROI.
- Choose employee rewards.
- Write and communicate your policy.
Enlisting the aid of an expert wellbeing consultant at the program’s inception will help to ensure you infuse your program with best practices and a construct that allows you to capture the value gained by your investment.
Clearly, workplace wellbeing programs bring value beyond financial or economic factors, such as physical and mental health, quality of life, perceived health status and functional capacity. Senior leadership can ignite a strategic business initiative of wellbeing which ultimately will deliver a return of value. That strategy develops a workforce culture where employees are engaged, accountable self-leaders who are supported in their pursuit of health, wellbeing and life accomplishment.
For additional information about employee benefit programs, including workforce wellbeing, call or email Todd Gordon, Vice President, CBIZ Benefits & Insurance Services, Inc., (770) 858-4801.