WASHINGTON – Both the public and private sectors took steps last month to test the concept that keeping employees healthy will save money on healthcare.
In Washington, two senators have introduced a bill that will encourage businesses through the use of tax credits to implement comprehensive workplace wellness programs.
Within a day of that announcement, the Midwest Business Group on Health announced a partnership with a vendor to provide administration for incentive programs for companies that belong to the group.
Both announcements lend support to the trend of employers providing more health and wellness options for employees as a way of reducing healthcare expenditures. In June, results of a survey sponsored by the ERISA Industry Committee found increasing implementation of health and disease management programs by employers.
The proposed legislation, the Healthy Workforce Act of 2007, is co-sponsored by Sens. Tom Harkin (D-Iowa) and Gordon Smith (R-Ore.). It would provide tax incentives to businesses, particularly small and medium-sized employers, that provide opportunities for employees to lead healthier lives and prevent chronic illnesses.
The act would provide a tax credit of as much as $200 per employee for the first 200 employees, and as much as $100 per each additional employee, to businesses that offer comprehensive wellness programs that include three of the following categories: health awareness programs, behavioral change programs, a supportive environment to encourage participation in wellness programs or an employee engagement committee to tailor the wellness program to the needs of a company’s workforce.
In touting the proposal, Harkin said employer spending on health promotion and chronic disease prevention is a good investment.
“Studies have reported a proven rate of return ranging from $2 to $10 for each dollar invested,” he said. “Workplace wellness programs also are economical, averaging $30 to $200 per employee.”
The American Medical Association, Disease Management Association and American Hospital Association, among other groups, are supporting the proposal.
“The legislation rightly joins employers, health providers and Americans together to fight chronic disease and foster healthier lifestyles,” said AHA Executive Vice President Rick Pollack.
In related news, The Midwest Business Group on Health signed an agreement with IncentOne of Lyndhurst, N.J., under which IncentOne will offer health and wellness incentive programs to 80 MBGH-member companies, which have more than 2 million employees.
The effort to find a company to operate health and wellness incentive programs is in part a response to members’ interests, said Larry Boress, president and CEO of the business group.