Employee Wellness Program ROI

Corporate Wellness Incentives

Employee Wellness Program ROI

Interest in employee wellness programs has been around for two decades or more. However, many companies did not offer health promotion plans because there was a lack of credible data to support employee wellness program ROI. Selling employee wellness programs at the senior management level can be difficult because a positive employee wellness program ROI may take 2-3 years and can be hard to gauge.

Employee Wellness Program ROI also has many components. Medical plan cost is a component, but improved health affects other business costs as well. employee wellness programs have an impact on sick time, workers’ compensation, disability cost and will enhance productivity.

Establishing the true impact on cost of all your employee wellness programs will be tough. However, your health promotion provider can determine the employee wellness program ROI for the programs it manages. In addition, a significant number research studies published over the last several years support the contention that employee wellness programs reduce costs. These research studies all use varying measurements to determine the employee wellness program ROI. In general, employee wellness program ROI ranged from 2 to 1 on the low end and 5 to 1 on the high end. Determining an accepted industry benchmark for employee wellness program ROI is tough because of the variety of employee wellness programs that businesses implement and the differences in evaluation methods.

However, the Art of Health Promotion, published in 2003, provided a composite review of the financial impact of employee wellness programs. The research study provided a organized review of health promotion evaluation research studies. One of the key problems in determining employee wellness program ROI is a lack of consistency or agreement on how to gauge the impact of employee wellness programs. The Art of Promotion worked to get past this problem and develop a melded result for employee wellness program ROI. The
employee wellness programs established that even though methods and approaches to determining financial impact vary greatly, the results are amazingly similar.

The research study, which was updated in 2005, showed paid time off, medical plan costs, workers’ compensation and disability costs decreased by a little more than 25% after determining employee wellness programs. These results show employee wellness programs are a good strategy for helping to mitigate cost and enhance productivity.

Some employers opt not to offer employee wellness programs because of turnover issues. It is true; employee wellness program ROI is not immediate and can take somewhere between one and three years to materialize. Therefore, employers with higher than normal may not receive an acceptable level of employee wellness program ROI. These employers may want to re-look at their turnover activity. If just one specific area of your company drives the rate of turnover, it may make sense to launch employee wellness programs in stable areas and take advantage of the benefits on your stable staff base.