What’s Missing in the Debate Over Employer Wellness Programs

Susan-Dentzer-For-PostBy now, Americans are no doubt getting used to debates that put show over substance and skirt the genuinely profound issues the nation faces. But although we may have come to expect as much in this political season, we deserve better when it comes to contemplating the role of employers in improving employees’ health.

A recent “debate” sponsored by the Population Health Alliance about employer wellness programs – the various health promotion and disease prevention strategies that about half of U.S. employers offer,  such as weight loss, smoking cessation and onsite gym classes – fell into the depressing pattern of highlighting the largely irrelevant at the expense of the important. The debate, which took place last November 2 at the alliance’s 2015 Forum in Washington, DC, pitted two frequent combatants:Al Lewis, founder of Quizzify and co-author of a book critiquing wellness programs, and Ron Goetzel, senior scientist at Johns Hopkins University’s Bloomberg School of Public Health and leader of the “Promoting Healthy Workplaces” program supported by the Robert Wood Johnson Foundation.

The ostensible topic was whether wellness programs benefited employees, companies, and society at large, but the debate never actually addressed this broad question. Most of the time, the session’s verbal jousting focused on a far narrower issue: whether companies saw any financial return on investment (ROI) on the dollars they plow into wellness programs.

Typically this ROI question has been framed as whether a dollar invested in a wellness program produces direct savings on a company’s costs for paying health care expenses for workers, as well as in reduced absenteeism of their employees. Multiple studies have attempted to sort out the issue in recent years, producing varying results, from negative to decidedly positive. Summarizing his take on the evidence, “There is no ROI on these things,” Lewis asserted at the debate. Goetzel disputed that conclusion, pointing to programs that were shown in studies to have positive returns.

What’s more, Goetzel was willing to lower the threshold even further, asserting that, “An ROI of 1 to 1” – presumably, when a dollar spent on a wellness program saved just a dollar in a company’s health spending –“is good enough for me – as long as the money is spent on demonstrably improving employees’ health and well-being at their jobs.”

I will spare readers the tedious back and forth devoted in the 90-minute session to this narrow ROI debate. As one member of the audience, Tami Simon, JD, managing director of the knowledge resource center at Buck Consultants, a Xerox company, pointed out afterward, the discussion neglected any other impact that wellness programs might have. These factors could include employees’ “presenteeism;” their sense of engagement, morale, or loyalty to their employer; or even on the company’s image as a desirable place to work and its ability to attract and retain employees. Any one of these, Simon noted, could reasonably be incorporated into any assessment of ROI.

For that matter, a thoughtful analysis might question why we would demand an ROI from wellness programs without an equally rigorous calculus of the returns from so much else that employers do – from providing paid vacation, to employee assistant programs, or even health insurance coverage.

The far more pressing issue is considering wellness programs in the context of the broader role employers should play overall in advancing their employees’ health. Thus, here are some questions that I wish the debaters had more fully addressed:

(1) How should employers think about their role in workers’ wellness in the context of the life span of those workers? Most Americans don’t enter full-time employment until their late teens or early twenties, a time at which much of their health status has already been effectively determined. It’s increasingly understood that many chronic conditions, such as type 2 diabetes, may take root in utero. Others are linked to adverse experiences in childhood,including physical, emotional, and sexual abuse, domestic violence, or even the mental illness or incarceration of a parent.

These early influences, and other so-called social and economic determinants of health such as educational attainment, are the primary drivers of anyone’s health status. To the degree employers have any ability to influence workers’ health, they thus arrive on the scene very late in the game. Yet unless they are prepared to hire only the best educated Americans with pristine health histories – or hire everyone else and just steel themselves to shelling out billions of dollars for health care – isn’t it obvious that they have to assume a greater role in supporting workers’ health? And wouldn’t a properly designed wellness program seem to fit that bill?

(2) If the answer to that question is yes, precisely what constitute best practices in wellness programs? As one comprehensive guide co-produced by Goetzel’s group at Hopkins and the Transamerica Center for Health Studies®suggests, the strongest wellness programs “link individual-level health promotion efforts with the overall company goals and objectives and [ensure] that both leadership and the workplace environment provide support for healthy choices.” Such programs frequently include many low-cost or free interventions, such as encouraging people to take the stairs rather than the elevator, and focus on tapping into employees’ sense of “intrinsic” motivation to be healthy and engaged.

So at NextJump (www.nextjump.com), a $2 billion New York-based e-commerce company that handles customer loyalty programs for firms like Hilton Hotels, employees are encouraged to work out twice a week for 20 minutes in the onsite company fitness center; take boxing, dance, and other fitness classes; compete in a weekly “Fitness Challenge” enabling teams to win up to $1,000; and eat trail mix and other free healthy snacks. NextJump’s leaders believe that they have already seen the payoff, pointing out that investing in workers, such as through the wellness program, is the only variable they have identified that can help to explain a four-fold increase in sales growth over the past several years. “The way we look at it is, why wouldn’t you invest in your employees?” Meghan Messenger, NextJump’s co-founder and chief of staff, asks in a video on the Promoting Healthy Workplaces web site.

(3) Whatever good they may accomplish, when dowellness programs cross the line into being unnecessarily invasive and or punitive, rather than supportive of workers’ health?At the Population Health Alliance Forum debate, just about the only topic that Lewis and Goetzel agreed on was that some programs went too far. Exhibit A: The short-lived Pennsylvania State University program that would have subjected employees to as much as $1200 in annual fines for not completing biomedical screenings or responding to intrusive online questionnaires. (After protests, the university jettisoned the plan.)

Lewis called the Penn State program “a disaster,” and Goetzel agreed that no evidence exists to support effectiveness of any such “surcharge” program. Meanwhile, there is also concern in some quarters about provisions of the Affordable Care Act and accompanying federal regulations that authorize incentives of up to 30 percent of the cost of health coverage– in effect, up to several thousand dollars annually – if workers participate in wellness programs. Although Simon of Buck Consultants notes that employers rarely set incentives that high, she says many companies believe that they still need these types of inducements to encourage workers to participate in wellness programs and induce healthier behavior. On the other hand, if incentives are too large, they could effectively trump other federal requirements that such programs be “voluntary.”

Of equal concern are other proposed regulations that would seem to conflict with the federal prohibition on genetic discrimination, and allow employers to ask employees and spouses covered under an employer’s health plan to undergo health risk assessments (HRAs) or be charged thousands of dollars more for health insurance. These HRAs could clearly unearth family health history, which under other aspects of federal law constitutes genetic information.

Drawing the line between a wellness program that serves employees and dependents, and one that is unduly intrusive or coercive, is obviously important. “If you got rid of these types of programs” that imposed surcharges for not participating in wellness programs, or denied workers hefty discounts on health insurance,that make participation seem less than voluntary, “there wouldn’t be such a [debate] over this,” said Debbie Chalfie, a senior legislative representative for financial security and consumer affairs at AARP. Lewis agreed: “Wellness should be done for employees, not to employees,” he said.

But the ultimate reason that wellness programs should be organized and executed for employees is that so many are predisposed to ill health long before they show up in the workforce. Workers whose health is or may be compromised can clearly benefit from well-designed interventions, and more robust research should be conducted to determine how substantial this benefit could be.

And who knows? Companies that give careful thought and attention to workers’ wellness may then to be moved to think about the bigger picture: How they can also affect the many large social and economic forces, from poor education to income inequality, that incline so many Americans to such poor health.

Susan Dentzer is the Senior Policy Adviser to the Robert Wood Johnson Foundation.

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5 replies »

  1. Nicely written blog post on the interesting, but ultimately useless debate about the ROI of employee wellness programs, or lack thereof.

    Most research looks at ROI measures too narrowly, both in terms of time and space, to make a proper ROI case one way or the other — the results from investing in the well being of your employees may or may not show up on the P&L over any meaningful budgeting period, or in directly measurable savings on Employer Sponsored Health Insurance costs.

    However, no one can credibly dispute that a) eating healthy, b) exercising regularly, c) sleeping well, d) reducing stress, and e) giving back to one’s community has a very direct impact on one’s quality of life and productivity. So, the only question really worth debating is whether employers, as a whole, have a broader societal role to play in providing tools, processes and incentives to help people achieve the 5 key things.

    When the ROI is not measured in percentages or multiples, but in orders of magnitude, the question simply becomes one of how can you, as an employer, not make the investment?

  2. At the risk of being annoying – while we’re asking questions of employer-sponsored “wellness” let’s ask the even more basic, fundamental one …

    Why is America the only industrialized country with employer-sponsored health insurance (ESI) at all?

    Everyone acknowledges that ESI is an accident of history and it creates tons of misaligned incentives – for both sides (here, let me put that Fitbit on the dog while I play tennis ball fetch so I can qualify for the “wellness” prize turkey).

    That aside – employer wellness AND ESI don’t just invade our personal privacy (as in health related issues), but often fundamental and deeply personal religious beliefs. How about these questions for HR during the hiring process?

    Should either (or both) employer (and employee) be required to disclose their religious beliefs during the hiring process? Some companies (like Hobby Lobby) are leveraging health insurance in pursuit of a religious agenda.

    Should group insurance rates increase for those companies (like Hobby Lobby) that ELECT to deprive women of reproductive health? Today the Federal Government is essentially picking up that tab – but that’s (yet another) workaround that (potentially) fractures any continuity of care.

    Quick refresher to Uwe Reinhardt’s quote (from Top 10 Healthcare Quotes of 2014 – #5: http://onforb.es/1qgQSr9 )

    “The [Hobby Lobby Supreme Court] ruling raises the question of why, uniquely in the industrialized world, Americans have for so long favored an arrangement in health insurance that endows their employers with the quasi-parental power to choose the options that employees may be granted in the market for health insurance. ”

    That’s the real question I see – not what benefit or ROI accrues to an employer for a “wellness” program.

  3. Some great points, Joe. Quizzify maintains its status as “a good place to work” by NOT having a “pry, poke and prod” program, which would drive a wedge between us and our employees. I try to encourage other technology companies in “Silicon Alley” to implement very comprehensive “pry, poke and prod” programs, so that they drive away their best employees and we can hire them..

  4. Al once again demonstrates his healthy spleen.

    Asking whether wellness programs have a positive ROI is the wrong question — a question we cannot get a useful answer to — three ways.

    First, we can’t make any sensible statement about “wellness programs” without defining what we mean. Organizing an employee hiking club could be a “wellness program.” So could heavily penalizing people that don’t complete a health risk assessment and get a health adviser.

    Second, we can’t make any sensible statement about positive ROI without defining what we mean. Confining the analysis to medical bills or the cost of self-funded insurance is probably not the right question to ask, since that is surely not the question the employer is asking. The employer is looking at all factors contributing to the bottom line. There is little doubt that employee retention, loyalty, group cohesion, and a feeling that “this is a good place to work” is good for the bottom line: lower hiring and training costs, higher sales, more continuity with customers, all that. These are the same reasons why many employers offer their employees many things that would not seem to directly contribute to the bottom line, such as offer them help getting college degrees — because a happy, cohesive, loyal work force is a powerful corporate asset.

    Finally, asking the question in such a blanket way elides the boundary between “wellness programs” and more comprehensive medical assistance programs such as Boeing’s, which offer extra medical help to employees who really need it for multiple chronic conditions. These are significantly more expensive up front, but the evidence from a number of such programs is that they more than repay the costs by lowering direct medical bills, before we even get to such questions as employee retention, and avoiding valuable employees taking early retirement for health reasons.

    If employers want to make smart policy decisions, they need to ask the questions with clarity and precision, honed to evoke real answers that actually make a difference to them and their bottom line.

  5. Obviously since you work with Mr. Goetzel you had a different view of the debate than Employee Benefit News and other non-affiliated observers. I don’t think it’s “irrelevant” that all the ROI figures in this field are blatantly made up, and that companies are wasting their money and – as you can see from my THCB posting – sometimes even harming their employees with “pry, poke, and prod” wellness programs.

    Ron, of course, is one of the leaders in fabricating outcomes, through his role on the Koop Committee. I recently showed that all of their figures are made up. http://theysaidwhat.net/2015/12/02/albert-einstein-meets-the-c-everett-koop-wellness-award/

    It must be frustrating for RWJ that you pay him all this money to do stuff like Graco, and in five minutes I find a bunch of rookie mistakes and suppressed data that invalidates the whole thing. http://theysaidwhat.net/2015/06/04/the-graco-goetzel-bravo-plot-thickens-more-twists-and-turns/

    Are you able to get your money back in those situations? Surely suppressing data is not up to RWJ standards.

    And I noticed you didn’t mention in the ”back and forth jousting” both that I presented a mathematical proof that wellness hasn’t and can’t save money, and that Ron admitted doctoring old original materials after one of my exposes, in order to cover up the fact that he accidentally admitted his beloved participants-vs-non-participants study is also completely invalid.

    And let’s be clear about Penn State. There are about 310,000,000 people in the US. 309.999,996 of them can say they did not participate in a press conference headlined as “Penn State Takes the Offensive in Wellness Controversy.” Ron was one of the other 4, so claiming he did not participate in pushing this program onto the backs of PSU employees is rather disingenuous, wouldn’t you say?

    Are you able to get your money back in those situations? Surely doctoring data and attempting to pass it off as legitimate – and saying you were not involved in a program when you were in the room defending it — is not up to RWJ standards.

    Also, the link with productivity was analyzed in the American Journal of Health Promotion. It turns out it’s a massive loser productivity-wise to give employees time off to work out. http://theysaidwhat.net/2015/11/01/american-journal-of-health-promotion-admits-massive-wellness-losses/