by Vince Wolf
Employers can raise deductibles and co-pays only so much before employees begin to doubt the value of their health benefits. So, organizations are looking for other ways to get meaningful savings as health costs continue to rise.
Enter the employee , believed to save employers between 3 and 6 percent on health plan costs—not including the savings from having a healthier work force that’s more productive and out sick less often.
Yet, as wellness programs become staples of large organizations, small employers remain reluctant to embrace them.
In our medical benefits survey of 335 companies in Pennsylvania, Ohio and West Virginia, 73 percent of organizations with more than 1,000 employees offered some sort of wellness program. But just 41 percent of firms with fewer than 500 employees have even a barebones wellness benefit program. Our sense is that wellness isn’t a consideration at all for the smallest employers.
A long-term investment
Why? Wellness is one of those “it-costs-money-to-make-money” propositions. When you engage employees in a wellness program, the first thing you do is send them to doctors to gauge their health and their risks. People who rarely or never go to the doctor make appointments and go. Some of them discover that they’re sick and need treatment.
That costs money. In fact, a wellness program that properly assesses the health of a work force will initially increase claims-related costs by around 1 or 2 percent. The 3 to 6 percent savings comes later, when those same employees are healthy because that first trip to the doctor stopped a potentially expensive medical condition from materializing.
Small business owners often feel they can’t absorb that 1 to 2 percent. In addition, they often can’t afford formal risk assessments, on-site gyms and other wellness benefits that might help to keep their workers healthy. They figure they don’t have enough volume to recoup the expense via fewer medical claims.
That doesn’t mean small employers can’t take small steps to help their employees stay healthy and show them they care about their well-being. Here are some ways they can:
- Ask your insurance provider if your employees can tap its online risk assessment or educational materials about prevention and treatment.
- Spread success stories around the office. If an employee is healthy because of an early diagnosis and wants to share his or her story, publicize it in the employee newsletter or during a staff meeting.
- In a small company, HR is likely to hear about the employees’ common health problems, like high cholesterol or asthma. Purchase disease- programs that target the conditions you know your small staff struggles with.
- Form an employee wellness committee to recruit co-workers to sign up for gym memberships, for example, and then approach the gym for a group discount.
- Partner with nearby small employers to pump up your purchasing power at a local gym.
- Ask local vendors how they can help. A company near our office takes orders from employees for fresh fruits and vegetables and delivers them here for free.
Vince Wolf is executive vice president of Cowden Associates, a benefits consulting and actuarial firm in Pittsburgh. Contact him at (412) 394-9330.
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