Employers are no longer using return on investment as the main measuring stick when it comes to wellness programs, but instead are focusing on overall value. Sixty-four percent of employers are focused on VOI, whereas 28% are focused on ROI, according to new Willis research.
Employers aren’t seeking dollar-for-dollar medical reductions, says Dr. Ron Leopold, Willis’ national practice leader, health outcomes. “When it comes to wellness programs, more companies are shifting to looking for value than return,” he says.
Nearly six in 10 employers have had an established wellness program for at least three years, according to the Health and Productivity Survey, which received responses from more than 700 employers — ranging from fewer than 100 employees to more than 10,000. “Wellness is growing,” Leopold says. “It’s becoming part of what companies do.”
Just 17% of employers said they don’t have a program nor do they have plans to implement one, which is “surprisingly low,” Leopold says. A lack of time and staff was cited as the top reason for not offering a wellness program.
Improving employee health and building a culture of wellness was the No. 1 goal for VOI-based employers, followed by reducing medical costs by targeting high-risk employees and reducing costs by cost-shifting. ROI-based employers cited the same three goals, however, improving employee health and targeting high-cost individuals shared the top spot.
‘Wellness requires a sustained effort’
Employers are more dedicated to improving access to care with programs such as patenting advocacy, telemedicine, onsite clinics and transparency, as well as pharmacy management, case management and disease management, Leopold says.
“More organizations are realizing that the expectation of an immediate return on investment for their wellness programs through medical cost reduction is unlikely,” he says. “Worksite wellness requires a sustained effort, including annual program review and long-term program management.”
A large percentage of employers lack a strategic plan for their wellness program. More than half, 51%, said they don’t have a written plan outlining goals, and 59% have failed to communicate those goals to all employees, the survey found.
Consultants can help employer clients sharpen their wellness program and transition it to a plan with clear focus and objectives, Leopold says. “Companies who adopt a true culture of health better position themselves for increased profitability in the long run,” he says.
While employers are looking beyond wellness programs simply to rein in rising medical costs, the latter is still a big concern, Leopold says. In fact, half of those surveyed said “they were more concerned about medical costs for the next three years than for the past three years,” and the looming Cadillac tax is a major reason, he says.
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