This is the first in a multi-part series about wellness programs in small businesses. This article looks at what’s involved in providing a wellness program that supports employee well-being, and ultimately creates a healthier organization.
Turn on the news, or look at the front page of any news outlet, and chances are you’ll see a report about America’s health crisis. It’s no secret that the majority of Americans (nearly 70% in 2011) fall into the “overweight and obese” category. According to the State of Obesity Project, obesity is “one of the biggest drivers of preventable chronic diseases and healthcare costs in the United States.”
Estimates indicate that healthcare costs in the U.S. range between $147 billion to more than $200 billion per year. Whether they’re a large or small organization, today’s employers are on the frontline when it comes to feeling the impact of those costs in the workplace. Increased health insurance premiums and other business expenses (larger chairs, sturdier toilets, more spacious office spaces, etc.) are taking a toll on company budgets across the country.
Offering health and wellness is no longer optional; for many companies it’s become a financial imperative. In 2012, the National Small Business Association conducted a survey of more than 1,000 small business owners that found:
- 93% of respondents said the health of their employees was important to their bottom line, while only 22% offered health and wellness programs.
- High stress levels were a top health concern, followed by psychological well-being, weight management, and drug or alcohol addictions.
- More than half of the small businesses employing more than 50 said health and wellness programs are critical for employee recruitment and retention.
- Lowering long-term healthcare costs, followed by improved morale and increased productivity, were the biggest motivators driving workplace wellness programs.
Source: National Small Business Association
Like larger corporations that have been implementing programs for several years, many small businesses are looking for cost-effective and smart ways to help employees get—or stay—healthy.
Here are three considerations when creating a wellness program for a small business:
Wellness programs come in different shapes and sizes
The Center for Disease Control defines workplace health programs as “a coordinated and comprehensive set of health promotion and protection strategies implemented at the worksite that includes programs, policies, benefits, environmental supports, and links to the surrounding community designed to encourage the health and safety of all employees.”
At first glance, a fear of policies, “environmental supports” and program costs might be what make small business owners back away from the idea of providing a wellness program for employees. But programs don’t need to be extensive to be effective.
Employer wellness strategies vary when it comes to what programs they offer. Components might include:
- Screening activities to identify health risks (e.g., measurement of body weight)
- Prevention interventions or lifestyle management (e.g., health coaching)
- Health promotion activities (e.g., free gym membership)
Some programs also incorporate incentives to encourage employees to take advantage of workplace wellness benefits. Those incentives might be linked to program participation, or to changes in health behaviors such as quitting smoking or decreasing body weight.
Research conducted by the Small Business Majority found that the most common wellness programs offered by small businesses (up to 100 employees) are flu vaccinations and health risk assessments. Other popular wellness programs address nutrition, tobacco cessation, alcohol and substance abuse, and fitness.
“I offer my employees a $100 per month budget for them to use on health benefits such as a gym membership, or other health benefits they choose,” says AJ Saleem, Director of Suprex Learning, a private tutoring and test prep company based in Houston, Texas.
Saleem has offered this benefit since Suprex Learning opened its doors in 2011. With nine employees on staff, the program and process is fairly simple. Employees choose where they will spend their health budget, and then submit a receipt (up to $100/month) for the cost (e.g., gym membership, physical check-up, etc.). Suprex Learning then reimburses the employee for that approved, health-related cost.
“I decided, why spend money on expensive insurance policies when I can offer employees proactive opportunities to protect their health instead,” Saleem says.
Wellness programs benefit employees and the business
For many small business owners, an important outcome of a wellness program is a happier, healthier employee. Survey results gathered by the Small Business Majority indicate that small business owners see additional positive outcomes of implementing a wellness program, including:
- increasing employee productivity
- improving morale
- reducing insurance rates
- helping to lower costs in the healthcare system overall
- reducing on-the-job injuries
- utilizing a federal or state tax incentive
An investment in health can really pay off for employees, as shown in the wellness program which began in 2009 at Allegacy Federal Credit Union, an organization with about 300 employees in North Carolina.
“Allegacy employees have seen a 50 percent reduction in risk factors since the wellness program began. Biennial culture surveys have also shown measurable increases in both employee engagement and trust during that same timeframe,” said Garrick Throckmorton, assistant vice president, organization development at Allegacy.
The investment pays off for the business, too.
“Our research has shown that for every dollar we invest in employee well-being, we are receiving a two dollar return,” said Throckmorton.
Health Affairs, a journal of health policy thought and research, reports similar findings based on their analysis of available data regarding wellness programs. Their analysis indicates that medical costs “fall by about $3.27 for every dollar spent on wellness programs and that absenteeism costs fall by about $2.73 for every dollar spent.”
Although these findings require further research to determine their applicability, the initial exploration indicates that businesses experience a return on investment. Offering a wellness program can be beneficial for small business budgets, while also improving employee health.
Wellness programs depend on financial and organizational readiness
Before offering a wellness program, it’s important to consider if it’s the right decision and at the right time for the business. It’s critical to take time to evaluate three important factors that will help identify if the organization is ready:
- Financial Costs: Wellness programs save money in the long run, but small businesses should identify and evaluate any up-front costs (e.g., sign-up fees, equipment, training expenses, etc.) before launching a program. To engage employees and realize the financial benefits, you must be able to commit to offering a wellness program for the long-term. Start small—identify how much money is available to allocate to a wellness program now, and plan to expand the program in the future, as your budget increases.
- Administrative Requirements: Maintaining a wellness program (even if it’s just tracking involvement, or communicating about the plan) requires at least a few hours from a staff member each month. If you’re going to run the program in-house, be sure you have staff available to keep the program running. If you’re hiring an outside firm or vendor, be sure you know what administration covers and what it will cost.
- Organizational Readiness: The success of your program depends on the readiness of your leadership team, as well as employees. Leaders need to be ready to support and communicate about the benefits of what you’re offering. Their demonstrated commitment to making health and wellness a priority makes it much more likely the program will succeed. Likewise, before you begin setting a strategy, confirm that your employees are interested, willing, and prepared to take action to improve their health. Engaged employees who are ready to participate will help the program gain traction among the larger employee population.
These factors are the foundation of building a successful program. Once readiness for a wellness program is confirmed, a plan needs to be put in place. Companies that have effective programs are anything but random in their approach.
“We know from research—and personal experience—that random wellness programs rarely thrive or provide the desired results over time. It’s only when an organization builds a strategic plan for creating a culture of health that is unique to their needs that sustentative and sustained results are seen,” said Throckmorton regarding the wellness program at Allegacy Federal Credit Union.
Allegacy’s wellness program—called AllHealth—began with goals focused on doing the right thing for the wellbeing of their employees. Over the last seven years, the program has evolved and now incorporates a holistic approach towards wellness. Today AllHealth addresses the many dimensions of wellness including physical, mental, social, financial, and individual purpose. Clearly, Allegacy is doing something right when it comes to wellness. In May 2016, the credit union once again earned the Best in Class honor in the Triad’s Healthiest Employers Awards; it’s their fifth such award since 2011.
Whether or not they’re winning awards, small business owners want the best for their employees. For companies that demonstrate financial and organizational readiness, a wellness program provides a way for businesses to contribute to their employee’s success. It’s an opportunity to positively impact employees’ health, increase overall engagement, and realize the economic benefits of a healthier workforce.
When the U.S. is faced with a health crisis that costs more than $200 billion a year, employers that provide wellness programs are also making a contribution to our society. A lot of good can come from helping employees learn and adopt new life skills that lead toward balanced and healthy lifestyle choices. Those choices will ultimately benefit not only the employee and the workplace, but the larger community as well.
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