Blog Post

Workplace wellness programs: Are they worth the investment or not?

January 14, 2014

    Paige Bashuck, Daily Briefing

    About half of employers use workplace wellness programs, but are they worth the investment? Definitely, argued a panel of wellness experts at last week's 2014 International CES conference—even though there's strong evidence suggesting otherwise.

    RAND: Workplace wellness programs don't deliver

    According to a much-anticipated 2013 RAND report, wellness programs don't save employers on health costs or greatly improve employee health. And at CES, panel moderator and RAND report co-author Kristin Van Busum reiterated that her group didn't "detect statistically significant decreases in cost and use of emergency department and hospital care" as a result of the programs.

    Why wellness programs might be worth the investment

    But other panelists—who specialize in employee wellness programs—had a different take.

    "If you are a CFO of a company and you want me to show you how these programs will save money, then you aren't the right company for us," said Derek Newell, CEO of Jiff, a company that creates, tracks, and stores employee wellness program information. "I'm not saying that we cannot provide cost savings…but our aim is to dramatically change an employee's experience with wellness programs and give them a human experience."

    "What we've found is that employees in wellness programs are more engaged in their workplace and are happier…when you give your employees value, they give it back to you in their work…we can't prove it on paper yet," Chris Boyce said,  CEO of Virgin's employee wellness offshoot company Virgin Pulse.

    Why wellness programs might not be

    John Workman of the Advisory Board's HR Investment Center says he doesn't disagree with these sentiments, but remains "skeptical of any hard-dollar savings from wellness programs."

    He added "wellness offerings can be an effective engagement driver, depending on your workforce, but it's important to keep your end goal in mind when designing wellness programs. Organizations looking to reduce benefits costs will be disappointed, while some organizations have geared wellness to improving engagement and seen some early success."

    From the HR Investment Center
    Achieving Return on Wellness Initiatives

    And while the Affordable Care Act offers inducements to launch a worker wellness program, there's no requirement under the law to do so. So "what do you say to companies about the value of investing in wellness programs?" Rand's Van Busum added.

    Evolution of wellness programs

    Advocates of employee wellness programs contend that many programs weren't set up to succeed. And the design of these programs is crucial, they add—that employees are most likely to thrive when the program includes incentives, competitions, and the ability to add friends or family members, according to Newell. That fits with another 2013 RAND report, which found that employee weight-loss programs worked best when competition was a factor.

    The best worker weight-loss programs add a competitive edge

    One way to encourage employees to improve their health? Provide them with real-time health tracking, like wearable fitness devices, argues Jawbone Health and Wellness vice president Christine Robbins.

    "People respond to real-time data on the steps they are taking and calories burning…and employees put these devices in a different class—they feel that their information is safer when it comes from the bottom up versus having it come from above," according to Robbins.

    From the Daily Briefing blog: The coolest wearable devices at CES

    However, the notion that wellness programs may allow employers to view employee health information is "the big white elephant in the room in our industry," Robbins said, adding that newer wellness programs are designed to keep employers' noses out of employee health records.

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