Workplace wellness programs are becoming increasingly popular among employers but they are not likely having immediate positive effects on the amount employers end up spending on healthcare coverage for their employees, found a recent study by the RAND Corporation.
Study author Soeren Mattke, senior scientist at RAND and managing director at RAND Advisory Services, and his fellow researchers combined a literature review, a national survey of employers that included almost 600,000 employees and dependents at seven employers, case studies of workplace wellness programs, and statistical analysis of the current use of workplace wellness programs in the U.S. to estimate the effect of these programs on employee health and healthcare costs.
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Mattke found that around 50 percent of employers with 50 or more employees offer wellness programs as a workplace benefit and that employers remain optimistic about their impact. But while well-executed programs appear to improve employee health, significant reductions in healthcare costs may take more time to materialize.
Lifestyle management programs, which are often part of workplace wellness programs, may reduce certain health risk factors, such as smoking, and increase healthy behaviors, such as exercise, he said.
“We find that these effects are sustainable over time and clinically meaningful,” the researchers said in the report. “This result is of critical importance, as it confirms that workplace wellness programs can help contain the current epidemic of lifestyle-related diseases, the main driver of premature morbidity and mortality in the United States.”
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The catch, Mattke explained, is that their research showed that the average annual savings for employers over a five-year period came out to around $157 per employee. Typical program costs are around $150 per employee per year.
“Overall, these programs are not saving employers any money, but they aren’t costing them any money either. There are significant and clinically meaningful impacts on certain health risks shown. Roughly the employers get those benefits at no extra cost to them,” said Mattke.
The reason that better health of employees will not bring cost savings right away is because not every health risk necessarily causes a disease or major health problem in every person, and many risk factors, such as obesity, take a long time to lead to the development of a disease, such as diabetes, he said.
With sustainable effects from workplace wellness programs on health risks, over time, it’s likely that employers will eventually see lower rates of chronic diseases, which leads to lower healthcare costs in the long run.
“With well-executed wellness programs, I think employers will see these results,” said Mattke. “The programs are turning out to be cost neutral. In addition, the better health of the employees might yield other cost savings, like better productivity among workers due to less smoking and better health overall.”
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