Wellness investments bring healthy returns

Lynne Haggerman: ROI can be hard to quantify with insurance rates on the rise.

Tiffany McClain: Metropolitan National Bank’s health-risk assessment is up 23 percent.

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As health insurance rates generally continue to climb, businesses and organizations across the Ozarks are seeking to save money where they can. For some, investments in wellness are the key to financial health.

According to a 2013 study of nearly 600,000 employees at seven large companies by nonprofit research and policy group Rand Corp., overall return on investment for employers in wellness programs was $1.50 for every dollar spent.

Sheila Bowen, employee wellness coordinator for Missouri State University, said wellness efforts the past eight years have helped the school’s health insurance cost per employee stay roughly flat at about $6,720 annually. That’s nearly half of the $12,500 per year other schools with more than 500 employees pay, Bowen said, citing a 2015 Mercer National Survey of Employer-Sponsored Health Plans.   

“We are heavy on nutrition programming because most people don’t get education on nutrition in grade school, high school and college,” Bowen said, adding MSU’s wellness programs stretch into such areas as financial management, relationships and stress management.

MSU’s employee wellness annual operating budget, which includes Bowen’s salary, is $175,000, and serves around 3,600 employees and their family members. Based on Mercer’s estimate of average expenses, MSU saves around $2 million per year on health care costs, but Bowen noted the university is self-insured, which also helps.

“We have an on-site and wonderful health clinic here on campus with 19 board-certified physicians. That’s a unique and special thing that faculty, staff and their families can go to, and that drives costs down,” she said.

“And we have a pharmacy on campus as well, so that drives costs down.”

MSU isn’t alone in beefing up its wellness offerings to maximize savings. According to a January survey from the Society for Human Resource Management, 76 percent of the 380 member respondents indicated they offered some type of wellness program, resource or service, and 72 percent of those employers felt their initiatives were somewhat or very effective.

Wellness as a benefit
At Metropolitan National Bank, wellness programs fall under a single initiative dubbed the Quality of Life program.

“We embrace many dimensions of wellness,” said Tiffany McClain, assistant vice president and strategic initiatives manager. “It’s not just about counting calories and hitting the gym. It’s about emotional wellness and financial wellness.”

The company had a traditional wellness program, but made a switch two years ago to a broader approach because few employees were actively involved. Now, Metropolitan sees its Quality of Life efforts as another employee benefit where the more people are engaged in the program, the more they get out of it.  

“We value your quality of life, and as part of our culture, we want to see your personal and professional growth,” McClain said.

Each month, employees are challenged to pursue wellness in a new area. The challenges might be meeting a personal budget goal or participating in a healthy-eating challenge.

“Healthy teammates are productive teammates, and that impacts the bottom line,” she said.

At Metropolitan, this year’s health-risk assessment for its 160 employees improved 23 percent compared to last year, said Whitley Lancaster, vice president and human resources manager. However, Lancaster wasn’t sure if that improvement would result in decreases to the bank’s health care expenses.

“There really is no way to guarantee what the final cost will come in at,” she said via email. “So far this year, we are trending nicely, but we still have three months left in the year. Additionally, our plan covers dependents.”

Calculating ROI
Return on wellness investment can be difficult to quantify. Employee health conditions and buy-in into wellness initiatives can vary greatly depending on factors such as company culture.

“Companies absolutely believe it is worth their time and effort,” said Lynne Haggerman, owner and president of Springfield-based human resources consultancy Lynne Haggerman & Associates LLC, adding she often sees double-digit percentage increases in the cost of care from year to year.

According to California-based Kaiser Family Foundation, health care costs are still climbing, but much less steeply than in the past. In 2014, costs were up about 3 percent with annual premiums for employer-sponsored family health coverage averging $16,834. However, over the past five years, those premiums rose 26 percent, which compares to a 34 percent increase in the previous five years.

According to the Kaiser health care reasearch and education group, in the late 1990s and early 2000s, annual increases were routinely in the double digits.  

“Health care is so expensive that anything employers can do to decrease cost will help. And, of course, the larger the employer, the more significant the impact can be,” Haggerman said.

Exposure to wellness initiatives generally is increasing because many health insurers, such as Humana, have built-in programs with incentives to fight the rising cost of care. Even so, local insurers say it can be hard to track the ROI of wellness programs because variables, such as the length of time a program is in place, employee turnover and the health of dependents, can affect rates.

“It has to be part of the culture. If the executives and HR don’t buy into it, it doesn’t work,” said Andrea Croley, co-owner of Croley Insurance and Financial Inc., adding it could take a number of years for a program to impact the bottom line. “You can’t go gung ho the first year. People aren’t going to stop smoking right away.

“And what works for one business, doesn’t necessarily work for another. For example, if you have a trucking company, you can’t have the same program that you might have for an attorney’s office. It has to fit the needs of that culture and company.”

Complete health
According to the Rand study, disease-management programs are the most effective. In general, wellness programs save employers around $30 per employee per month, but 87 percent of those savings come from disease-management efforts.

The study credited those programs with reducing hospital admissions among participants by nearly 30 percent.  

At MSU, wellness initiatives include a comprehensive seven-week effort called the Complete Health Improvement Program, which emphasizes nutrition in the effort to fight such diseases as diabetes and heart disease. There also is a Couch to 5K program, tai chi, restorative yoga and a Mindfulness and Meditation program, which Bowen says is popular.

“I want to try and get everyone involved in something,” said Bowen, who built the university’s wellness programs from the ground up, noting wellness is about more than just a person’s physical health. “I take it a bit further than a lot of organizations.”