Corporate Wellness Blog : The Case for Corporate Wellness Programs
Posted by Corporate Wellness | Posted in Corporate Wellness, Health Program Ideas, Health and Wellness | Posted on 21-05-2009
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Corporate Health Promotion Programs first became popular during the economic boom of the late 1980s and early 90s. Programs featured on-Site fitness centers and massages, and were used as recruitment tools for young staff members searching for nontraditional work environments. Nonetheless, when the tech bubble burst, so too did the willingness to spend money on perceived perks, and corporations returned to a more antiquated benefit structure focused on managed medical care.
In recent years, as Health Care costs have spiraled out of control, companies have explored the potential of Corporate Health Promotion Programs as a cost-saving strategy. Corporations such as Johnson and Johnson, General Motors, Motorola and Union Pacifi c Railroad have all seen a signifi cant return on investments in employee health (See Case Studies, p.20). Corporate Health Promotion Programs can help decrease the costs associated with:
Health Care premiums – The expense a organization pays for healthcare insurance: According to a 2005 study by Hewitt, the Health Care expense per employee in the American in 2006 will average $8,046, with employers absorbing nearly two-thirds of that expense.
Prescription Drug costs – The price of a drug plan: According to a 2005 study by Mercer, the average annual drug costs for large corporations grew 11.5 percent, making it nearly a decade straight of double-digit rises in cost.
Short-term disability (STD) – The price of offering short-term disability insurance to staff members: According to a 2004 study by insurance provider Cigna, the average short-term disability claim results in $13,094 in direct disability payments and medical costs. The report also found that 26% of claims related to healthcare events were a result of chronic conditions that could likely be mediated through Company Health Promotion Programs, and that these cases amount for 56% of the STD-related medical costs.
Absenteeism – The cost of missed work: Absenteeism cost organizations $660 per employee in 2004, with nearly one-third of organizations characterizing the trend as a genuine problem.
Presenteeism – The price associated with staff members who work at decreased productiveness levels: Sixty% of the total cost of employee illnesses come from presenteeism, according to a 2004 study by the Institute for Health and Productivity Studies at Cornell University.
The evidence is clear that strategically designed Corporate Wellness Programs can reduce both direct and indirect Healthcare costs. A 2004 review of Corporate Wellness Programs revealed that, in total, an investment of $1 by a company in Wellness Programming returned a median cost savings of $2.05 to $4.64.

