Why should your company offer worksite wellness programs?

Lower Health Care Costs Reduced Absenteeism Higher Productivity Reduced Use Of Health Care Benefits Reduced Worker's Comp/Disability Reduced Injuries Increased Morale and Loyalty Worksite Wellness Works !

With increasing evidence supporting health promotion programs in the workplace, more companies than ever are implementing health and wellness strategies to reduce injuries, health care costs and long-term disability. We want to hear from you! How healthy is your company? Take our online poll and let us know if your company has some sort of health promotion program established in your workplace.


Escalating health care costs continue to remain an issue of great concern for many health professionals, employers and insurance companies. The latest statistics establish that 80% of illnesses and disease in Canada and the United States are preventable. This accounts for eight of the nine leading causes of death, of which there are more than 980,000 per year. Unfortunately, cardiovascular (heart) disease is still the biggest killer and makes up for more than 50% of this number. Yet heart disease is still one of the most preventable diseases in this country. Here are some of the latest statistics concerning health care. More

According to the Wellness Councils of America (welcoa.org), more than 81% of businesses with 50 or more employees have some form of health promotion program -- the most popular being exercise, stop-smoking classes, back care programs, and stress management. Most employers are offering wellness programs to offset the rising costs of health care. Yet many business leaders continue to ask themselves how to control massive increases in annual insurance premiums and health care costs.

For many companies, medical costs can consume half of corporate profits -- or more. Some employers look to cost sharing, cost shifting, managed care plans, risk rating, and cash-based rebates or incentives. But these methods merely shift costs. Only worksite health promotion stands out as the long-term answer for keeping employees well in the first place.

Worksite wellness is health care reform that works. Results from North America's finest companies, summarized here, are reason enough to think about an investment in your most important asset -- your employees -- and the impact this investment can have on your bottom line.

Reduced Absenteeism

Reports show that healthier employees spend fewer days away from work due to illness, saving the company thousands and even millions of dollars on down time and temporary help.   Wellness programs can also help alleviate depression and help employees manage their time and stress levels better, all of which are contributing factors to missed work days. 

In one study, members of a Travelers fitness center were absent from work significantly fewer days than nonmembers and in another four year study, sick leave was reduced 19%.
WELCOA -- 1999  

At DuPont, each dollar invested in workplace health promotion yielded $1.42 in lower absenteeism costs over a 2 year period.
American Journal of Public Health, September 1990

Johnson and Johnson reduced their absenteeism rate by 15% within two years of introducing their wellness program. They also cut their hospital costs by 34% after just three years.
Human Resources Executive, April 1993

To prevent back injuries among its employees, a county in California offered classes and fitness training to all it's workers. As a result, there was a significant decrease in sick days related to back injuries, producing a net cost-benefit ratio of 1 to 1.79.
WELCOA – 1999

Northern Gas Company employees who participate in the company's corporate exercise program take 80% fewer sick days than non-exercising employees.
Health Promotion and Education Programs, Riverside Occupation Health Services, 1991

At Mesa Petroleum, wellness program participants were absent 1.6 fewer days per year than non-participants.  Given the number of employees, this resulted in significant cost savings.
The Benfield Group, St. Louis, Missouri, February 1996

Coors has saved over $2.3 million in lost wages due to absenteeism and $1.9 million in rehabilitation costs and cost avoidance.
Business and Health, November 1992

Reduced Health Care Claims

The average annual health care cost per person in the United States far exceeds $3,000.  And preventable illness makes up approximately 70% of the total costs of illness. Because much of these costs are linked to health habits, it is possible for employers to take aggressive action toward reducing health care utilization and containing costs by implementing a health promotion program.

         Yearly Claims Costs of an Unhealthy Employee
It costs employers an average of $1500 MORE per year to insure and obese employee than it does someone of average weight.  This includes medical services, expenses, premiums etc... The total cost for employees in categories listed above is assumed to be even higher when other factors such as absenteeism and productivity are taken into account.
Employee Benefit News; May 1997

Sony Corp. of America analyzed claims data from 1988 to 1990 and found that 50% of its indemnity plan costs were incurred by employees with medical conditions that were lifestyle-related, or that could be changed.
Employee Benefits Plan Review, January 1992

Waste Management, Inc. implemented a pilot, stress management program for employees and their families; it reduced the total number of claims for the company and resulted in estimated savings of between $3,750 and $15,000 per participant, per year.
Business and Health, November 1992

As the result of a pilot program at Honeywell, Inc. which offered a $200 cash incentive based on participation in certain program areas, program coordinators estimated a 70% to 150% return on investment from reduced medical claims alone.
Business and Health, November 1992

In 1990, The Canada Life Assurance Company (CLAC) compared its per-capita medical claims to a comparable insurance company that, unlike CLAC, did not provide a wellness program for its employees. The study found that the other insurance company's per-capita medical expenses climbed from $170 to $229 (Canadian currency), while CLAC's per-capita cost remained constant at $170.
Worksite Health Promotion Economics, 1995

A 1992 analysis of the employees of GE Aircraft showed that medical claims submitted by the company's fitness center members decreased by 27%, while claims made by non-members actually rose by 17%.
Worksite Health Promotion Economics, 1995

At the Westinghouse Electronic Assembly Plant, workers who participated in the worksite fitness program cost the firm approximately $1,715 less than workers who did not participate.
Benefits Today, August 1992

Studies show that employees who exercise as little as once a week incur healthcare costs that are one-third to one-half lower than those who don't.
Sales and Marketing Management, June 1995

Reduced Employee Turnover

Company sponsored wellness programs send a clear message to employees that management values them and their well-being.  Secondly, healthy employees tend to be happier and not as restless to leave. The healthier and happier the work force, the less a company has to spend on hiring and training new personnel.

The annual turnover rate for wellness program participants of the Canada Life Assurance Company of Toronto was 1.8%, compared to the company-wide average of 18%.
American Journal of Health Promotion, April-May 1993

British Columbia Hydroelectric's wellness program participants had an annual turnover rate of 3.5%, compared to a company-wide average of 10.3%.
Benefit of Employee Health Programs, Cigna, 1991

A study at Tenneco found that employees who participated in the fitness program had a much higher probability of continued employment than non-participants.

Improved Productivity and Morale

As businesses continue to streamline their resources, worker productivity becomes a key success factor.  Although not as easy to measure as a reduction in healthcare costs, improved employee productivity and morale can have a considerable impact on an organization and its profitability. Corporate wellness programs play a key role in maintaining and improving productivity and employee morale.  

Union Pacific Railroad found that 80% of its workers believed that the company's exercise program helped to increase their productivity and that 75% felt that regular exercise was helping them to concentrate better at work.
Incentive, June 1995

A NASA study reported a 12.5% increase in productivity in their fitness program participants versus non-participants.  They also found that participants were able to improve their work performance as well as enhance their concentration and decision-making powers.
Company Employee Fitness Programs, The Association for Fitness in Business, 1991

A study by Saatchi & Saatchi Advertising revealed that 63% of the employees enrolled in the company's fitness program believed that it improved their productivity; 75% said that it boosted their morale.
Good Health Good Business, Johnson & Johnson, Second Quarter, 1990

Overall Return on Investment

Since 1980 there have been over 50 studies of comprehensive worksite health promotion and disease prevention programs.  Every study has indicated positive health outcomes.  And of the more than 30 which were analyzed for cost outcomes, 29 proved to be cost effective. 

IRSA, the Association of Quality Clubs –1992