Employers Try To Boost Success Of Health And Productivity Programs

To boost the success of health and productivity programs, employers have to address lifestyle risk issues, improve employee engagement, and articulate a strategy in order to establish a workplace health culture, an essential factor for success, according the 2013/2014 Staying@Work Survey, conducted by Towers Watson, and the National Business Group on Health (NBGH). In nearly all of the countries or regions that participated in the study, the same three lifestyle risks arose as the biggest workforce issues: stress, obesity, and lack of physical activity. These risk factors can result in increased employee illness, higher medical costs, and lost productivity due to unplanned absence and decreased efficiency at work, according to Towers Watson and the NBGH.

To combat these issues, companies have to overcome poor employee engagement. Seventy-seven percent employers view a lack of employee engagement as the biggest obstacle to changing behavior. Despite offering a variety of health and productivity programs, employers report that actual program participation is low.

“Companies have long maintained that a healthier workforce is a more productive workforce, and many are considering innovative tactics to improve employee health and well-being,” said Shelly Wolff, senior health care consultant at Towers Watson. “But along with the urgency of health care reform and the coming excise tax, there is a realization that companies need to manage these programs more effectively and encourage employee participation and engagement. An essential part of increasing engagement and success is for companies to link a health and productivity strategy to their overall employee value proposition.”

Effective health management programs foster behavior change. In the U.S., highly effective companies (where employees are more engaged in their health and well-being) have a differential in annual health care costs of more than $1,600 per employee. According to the survey, these companies are:

• gaining the commitment of senior leadership;
• developing a comprehensive strategy;
• implementing employee engagement strategies;
• engaging managers as role models;
• communicating frequently to employees;
• reducing employee stress;
• providing easy access to high-quality health care services; and
• understanding health and productivity outcomes by establishing metrics.

Use of incentives and penalties to hold employees accountable. Seven in ten U.S. companies identify developing a workplace culture where employees are responsible for their health as necessary and understand its importance as a top priority of their health and productivity programs. Employers are increasing use of financial incentives, specifically penalties and outcome-based incentives, to hold workers more accountable and improve health outcomes.

In 2014, 36 percent U.S. companies will use penalties such as an increase in premiums and deductibles for individuals who do not complete the requirements of health management activities (with a jump to 61 percent for 2015/2016). Outcome-based incentives that reward or penalize employees based on tobacco use will grow from 54 percent next year to 71 percent in 2015/2016. In addition, rewards or penalties for other biometric outcomes (e.g., health-contingent targets such as BMI, blood pressure or cholesterol level) will dramatically increase from 26 percent in 2014 to 68 percent in 2015/2016.

Need for a clearly articulated strategy. Nearly half of U.S. respondents (49 percent) believe that health and productivity programs are essential, and 84 percent plan to increase support of these programs over the next two years. However, only three in ten respond that they have effectively communicated a strategy and value proposition, making it difficult for employees to understand the purpose of these programs and their roles in them.

Driven by the imperative to have a high-performing health care program that is cost effective, avoids the 2018 excise tax and encourages a healthy workforce, companies are beginning to understand the importance and value of an organized approach. Virtually all employers (94 percent) plan to articulate a health and productivity strategy with stated objectives in the next three years.

“More than ever, employers view health as a total business issue that links to worker performance. Highly effective organizations do a number of things differently, and their results are far better than those of their peers,” said Helen Darling, president and CEO of the NBGH. “They take a holistic view of health and productivity programs and benefits to foster a culture of health in their workplaces and promote healthy lifestyles, and that approach will serve them well in the years to come.”

For more information, visit http://www.towerswatson.com.

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