Category Archives: wellness initiatives

Employee Health Takes on New Meaning

Two different studies came to my attention at SHRM’s 2012 Annual Conference and Exposition — both underscoring a growing awareness that keeping workers working, and healthy and productive, is probably the best way to cut healthcare costs.

In essence — though as important cost-cutting factors — focusing on plan design and doctors’ and drug costs may be taking a back seat to keeping workers healthy and happy, at work.

One, a just-released report from The Standard Insurance Co.’s Workplace Possibilities program, titled Health-Related Lost Productivity: Causes and Solutions, kind of turns on its ear the notion that medical care and drug costs should be employers’ biggest worries.

It cites recent studies (one in the Journal of Occupational Environmental Medicine, “Health and Productivity as a Business Strategy: A Multi-Employer Study,” and two others by Mercer and Kronos on the Total Financial Impact of Employee Absences) showing that medical and pharmaceutical costs make up only 30 percent of the total cost of poor employee health.

The other 70 percent can be attributed to what The Standard calls health-related lost productivity costs. Those accrue through presenteeism (workers showing up but not producing at full capacity due to illness) and absenteeism. And the latter costs accrue through all kinds of demons: overtime for the workers left to pick up the pieces, turnover should patients never return, temporary staffing, working slow, late deliveries (because, let’s face it, replacements just don’t know the ropes like the employees themselves), replacement training, customer and variable product quality.

Michael Klachefsky, national practice leader of The Standard’s Workplace Possibilities program and author of the report, calls it the “iceberg concept.”

“These are the hidden costs, like the part of the iceberg under the water’s surface,” he tells me. “Our findings show the people left to pick up the slack are, on average, 15 percent to 44 percent more expensive, and 21 percent to 29 percent less productive.”

His research shows that, for every $1 employers spend on worker medical or pharmacy costs, they absorb at least $2.30 of HRLP costs.

“It’s intuitive,” says Klachefsky, “but no one ever measured it before.”

His company actually bases its services on this concept through numerous proactive fixes, such as on-site wellness and return-to-work consultants, ergonomic advice, products and services, and a blog — — devoted solely to educating employers and employees about ways to avoid medical leave and keep short-term disability from becoming long-term disability.

“We’re doing the 70 percent,” Klachefsky says. “Most others are addressing the 30 percent.”

Also at the conference, SHRM released its 2012 Employee Benefits Survey, showing more employers are offering benefits now that encourage employees to improve their health. Of the 550 randomly selected HR professionals surveyed by SHRM, 45 percent are now offering health and lifestyle coaching, up from 33 percent in 2008, and 35 percent are rewarding — through lower premiums or bonuses — workers who complete health and wellness programs, up from 23 percent in 2008.

“Employers recognize that providing employees with the opportunity to improve their health can increase morale, confidence and productivity,” says Mark J. Schmit, vice president or research at SHRM.

“Organizations continue to look for ways to manage costs as the economy slowly improves,” he says, “[recognizing that] healthier employees … help decrease healthcare costs to employers and employees.”



CEOs Urged to Pledge their Commitment to Wellness

Ever since the wellness movement began, we’ve been hearing — and writing — that a corporate commitment to wellness starts at the top. Unless the CEO and other C-suite leaders buy in to the idea, a wellness initiative will likely fall flat, and often does, we’ve heard — and written.

Enter the nation’s first-ever National Physical Activity Plan to spur that buy-in on, through it’s CEO Pledge. By taking the pledge, CEOs vow to improve their employees’ health and wellness by producing opportunites and resources for physical activity before, during or after the workday.

The Pledge was unveiled last week at the HERO Forum (the annual conference of the Health Enhancement Research Organization) in Phoenix. Earlier this week, on Tuesday, the International Health, Racquet & Sportsclub Association put out its own battle cry urging all C-suite executives to take the pledge.

“The CEO Pledge makes it clear that business leaders have an influential role to play in addressing our country’s health and healthcare crisis,” says Joe Moore president and CEO of IHRSA. “With most working adults spending roughly half their waking hours on the job on the days that they work, it is incumbent upon business and industry leaders to become part of the solution.”


Partnership Moves the Cash-for-Healthy-Behavior Trend Forward

The emerging trend of paying workers cash for healthy behavior got a boost today in the announcement by InteliSpend Prepaid Solutions that it is now partnering with Virgin HealthMiles to provide its clients with the latter’s wellness expertise, program design and program delivery.

Rewarding cash through prepaid cards strictly as a reward for achieving a wellness goal — as opposed to discounting premiums or awarding other health-based services — is “just now starting to catch on,” Deanna Baker, InteliSpend’s vice president of employee development and human resources, told me moments after making the partnership announcement the second day of the SHRM conference in Las Vegas.

“With healthcare reform moving forward,” she said, “we’re seeing more employers who weren’t focusing on wellness before now seeing they need to. And more and more are catching on to the fact that incentives will be the big mover of this trend.”

Earlier this year, Fenton, Mo.-based InteliSpend, an employee recognition and prepaid-incentive provider, announced its exclusive MasterCard wellness prepaid card, its “venture into the incenting-wellness arena,” where the future lies, Baker said. London-based Virgin HealthMiles “already gets this,” she added, as a provider of employee health programs that pay people to get active.

What’s Working in Wellness

Monday’s Benefits Panel at the Human Resource Executive Forum® — “Is Wellness Worth It? Pursuing a Real ROI for Wellness” — went well beyond questions of investment returns and lower healthcare costs. The heart of that session’s message was more about the people: making them better, and making wellness work, by recognizing their needs.

Panelist William D. Katz, vice president of human resources for AmeriGas Propane Inc., shared his experience of coming to grips with the nature of his workforce — and getting top managers’ attentions about that too — before a real commitment could be made and real results could come in.

“Understanding wellness means understanding human nature,” said Katz. “In our workforce, there are a lot of truck drivers, and a lot of them are heavy smokers. We also have lots of obesity. We’ve had lots of results pointing to what we need to do.”

But it wasn’t until Katz took that data and compared it to his company’s life insurance data over three years that the population statistics could really made a statement — to him and the C-suite as well.

“We saw three times as many [AmeriGas employees] were dying compared to the general population,” Katz said.

Now in the company’s third year of the wellness program he was able to convincingly argue for, “our premature death rate has improved by 40 percent,” he said.

Panelist Mark Bukowski, senior health and clinical consultant for Aon Hewitt, agreed it “all comes down to letting the data help you make your wellness decisions,” not just seeking the data to prove wellness’ worth.

At Aon Hewitt, he said, “we custom-design wellness programs for each company, each location … that’s where all this is going.”

Even securing buy-in from a CEO is sometimes more effective and successful, panelists agreed, when applying a human touch.

“We find CEOs are actually more enthused by the anecdotal proof [of a wellness program’s success] from employees who’ve been through it than the hard data,” said panelist Jennifer Benz, chief strategist and founder of Benz Communications.

The group — led by moderator Michael Miele, president of healthcare analytics group for Gallagher Business Services — seemed to agree that the data going in can be more effective than the data coming out.

“We’re all seeing the power of trend data,” said Benz, “how your workforce data compares to all the other workforce data [in specific regions and otherwise].”

Top Stories on HREOnline Last Week

These were the most-read stories on HREOnline™ last week, in case you missed any:

1. Technological Revolution: Sue Meisinger’s latest HR Leadership column:

The ease of using social-media tools, combined with recent indications that the Democratic-controlled National Labor Relations Board will be examining acceptable uses of technology by employees — and not just union employees — means that HR leaders should be taking a hard look at the issue as well.

2. Bridging the Credibility Gap: a contributed article by Sarita Bhakuni and Michelle Johnston, both with CPP.

To retain top talent, organizations need to start talking to their employees. When left in the dark, people draw conclusions which tend to be worse than reality. HR leaders should also be aware of uncharacteristic behavior by their managers, which often indicates high levels of stress.

3. Court Rules for Third-Party Retaliation Claims, by Tom Starner

A decision by the U.S. Supreme Court to reactivate a lawsuit — based on a claim that a company retaliated against one employee by firing her fiancee — should result in more lawsuits being filed by spouses and significant others. But the unanimous decision did not define just how expansive the “zone of interests” is, leaving HR leaders in the dark about where to draw the line.

4. Marketing HR Messages, by Kristen B. Frasch

Should HR leaders turn over their internal communications and engagement efforts to marketing professionals? No, say HR experts, but their organizations sure could benefit by HR learning more about the marketing mind-set.

5. Temp Salaries Rising, By Michael O’Brien

Wages for skilled, temporary workers are beginning to inch up from their low points, according to new benchmarking information. And since demand for temps — which historically precedes the demand for permanent workers — is increasing, does this mean the job market is finally improving?

The Down Side of Wellness

You know those cautionary asides you see in stories — especially now that the web and newspapers are filled with articles on diet and excercise — about how individuals should check with their physicians before increasing physical activity?

Most people probably skim right over that warning. But, unfortunately, those things are written for a reason — as one HR executive in Singapore recently found out.

According to this New Zealand news site, 54-year-old Ong Joo Aun, an HR leader who was appearing on a reality show, Lose to Win, lost consciousness after the daily brisk walk of two kilometers (1.2 miles).

“Lose To Win” encourages participants to lose weight, up to 5Kg (about 11 pounds) per month through numerous nutrition workshops, physical exercises and fitness assessments. The cash prize for the winner is reportedly $5,000.

This is probably something HR leaders should keep in mind as their organizations roll out their wellness initiatives and incentives.

U.S. Businesses Still Not Measuring Wellness Effectiveness

Came across this release about a new study by Buck Consultants, a Xerox company, showing that U.S.-based companies are spending more on wellness programs, but have yet to figure out how to measure their results.

The study, Working Well: A Global Survey of Health Promotion and Workplace Wellness Strategies, Buck’s fourth annual global wellness survey, anaylzed responses from more than 1,200 organizations in 47 countries representing more than 13 million employees. It found employers worldwide — including in the United States — spent 35 percent more on average (about $220) per wellness-program participant in 2010, compared to the survey’s 2009 findings.

Yet, only 37 percent of U.S. employers actually measure their program’s effectiveness, according to the report.

“Organizations that measure the impact of their wellness programs are more successful at improving their employees’ health and overall wellness,” says Barry Hall, a Buck principal who directed the survey. “However, many simply don’t know how to measure their results, or they don’t have the resources to do so.”

This should tie in nicely with a March 15 session at our magazine’s upcoming Human Resource Executive Forum® in New York, entitled “Is Wellness Worth It? Pursuing a Real ROI for Wellness.” (The Forum, which covers other key HR-leadership concerns, runs March 14 through 16 at the Grand Hyatt New York. Here’s a link if you’re interested.)

Our description of the session mentions that the “verdict is still out on just how effective these programs are in improving the health of employees and the bottom line.” Clearly, the Buck study confirms there’s a good reason for that: Too few companies are properly measuring that effectiveness.

It also underscores the right timing of our session’s exploration into how best to go about this.

Wellness Lives On

The U.S. Equal Employment Opportunity Commission issued final regulations today to implement the Genetic Information Non-Discrimination Act of 2008 — and to the relief of many employers, the regs permit the use of financial incentives for filling out health-risk assessments.

And that means, says Larry Lorber, a partner in the Washington office of Proskauer, that employers can continue to provide wellness programs for workers.

“They are now allowing that to happen whereas in their [preliminary regulations] … they did not allow that to happen,” he says. “It’s a significant change.”

And it’s why the final regulations “were held up so long” as a compromise was sought, Lorber says. The rules go into effect in 60 days.

The first lawsuit filed under GINA was from a woman who said she was fired from her job after mentioning she was susceptible to breast cancer.

Total Rewards with a Twist of Customization

Two studies released Monday at the WorldatWork’s Total Reward 2010 Conference in Dallas, Texas shed light on what employers might want to do differently as they begin to staff up again.

During a session on the conference’s opening day, researchers from Texas A&M University shared the findings of a recent study of accounting students that found the influence of particular rewards and benefits frequently depended on the outcomes being sought (i.e. attraction, motivation or retention). The study, “The Relative Influence of Total Rewards Elements on Attraction, Motivation and Retention,” found that career development was especially important to students pursuing a career in accounting. Meanwhile, work/life benefits and performance recognition were much more important to those who ended up employed at one of the Big Four account firms for several months. (Response rates of the different groups studied over the several year period ranged from 159 to 232.)

Similarly, a study entitled “Beyond Compensation: How Employees Prioritize Total Rewards at Various Life Stages” found that respondents valued different rewards at different stages of their lives, with development significantly more important for employees under 40 and benefits much more important to breadwinners, especially female breadwinners. (The study of 678 adults was conducted by Next Generation Consulting and Dieringer Research Group.)

Most HR leaders aren’t going to be terribly surprised by the studies’ conclusions. Indeed, both seem to be in line with the findings of earlier research projects. But if there continues to be any doubting Thomases out there who still think they can get away with a one-size-fits-all approach to total rewards—and one suspects there are—then perhaps these findings will give them reason to pause and reconsider.

Rebecca Ryan, CEO of Next Generation Consulting, suggested to attendees that employers might be well served by stealing a lesson from Starbucks’ playbook and the way it was able to build its business by customizing coffee and latte drinks—as in “I’ll have a triple decaf Grande Latte with skim”—when it comes to designing their total-reward programs.

Meanwhile, Mercer Senior Partner Steve Gross is scheduled to share the findings of a third survey on Tuesday that found companies continue to invest in their total-reward programs during the economic downturn and modify the elements of “total rewards.”

The study revealed that 50 percent of the 741 responding multinational companies responding consider “work-life initiatives” a staple of total rewards, while four in 10 reported they either enhanced or added wellness programs during the past 12 months.

All three studies were sponsored by WorldatWork. The Total Rewards 2010 Conference runs through this Wednesday and is expected to attract around 1,500 attendees.