Company wellness programs improve health, cut costs

Employee wellness programs just may be the cure for companies struggling to keep up with rapidly rising health care costs.
And proponents say that in addition to saving companies money, the programs are an effective way to help employees live healthier lives.
Jeff and Linda Pond of Virginia even suggest that Linda's company wellness program may have saved Jeff's life.
Two years ago, Pond received a letter informing him that his annual blood test results indicated he might have prostate cancer. The letter advised him to consult his physician.
Pond is now six weeks out of surgery to treat early stage prostate cancer and says things are "back to normal," thanks to Linda's employee wellness program at Quest Diagnostics, which provided the free blood tests that initially detected signs of cancer.
"My cancer would have gone undetected for years, and likely wouldn't have been nearly as treatable as it is," Pond said, adding that early detection saved him from having to go through more intensive -- and expensive -- treatments down the road.
It is this concept of preventative care that spurred the CEO of Quest Diagnostics -- where Linda works as a registered nurse -- to implement the company's wellness program four years ago, said Steve Burton, vice president of health and wellness services at Quest Diagnostics.
The company's voluntary program, Healthy Quest, provides employees, their spouses and domestic partners with a personalized health report -- called Blueprint for Wellness -- based on laboratory testing. The program also provides educational materials, weight-loss support groups, fitness classes, a smoking cessation program and personal counseling sessions. Employees who participate in the free program are given $10 bi-weekly as an incentive, Burton said.
So what's in it for the company?

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Congress Plans Incentives for Healthy Habits

In its effort to overhaul health care, Congress is planning to give employers sweeping new authority to reward employees for healthy behavior, including better diet, more exercise, weight loss and smoking cessation.

Congress is seriously considering proposals to provide tax credits or other subsidies to employers who offer wellness programs that meet federal criteria. In addition, lawmakers said they would make it easier for employers to use financial rewards or penalties to promote healthy behavior among employees.

Two Democratic senators working on comprehensive health legislation, Max Baucus of Montana, the chairman of the Finance Committee, and Tom Harkin of Iowa, have taken the lead in devising such incentives.

"Prevention and wellness should be a centerpiece of health care reform," said Mr. Harkin, who regularly climbs the stairs to his seventh-floor office on Capitol Hill.

The White House agrees. One of President Obama's eight principles for health legislation is that it must "invest in prevention and wellness," a goal espoused in almost identical words by Republican senators like John Cornyn of Texas and Orrin G. Hatch of Utah.

Frank B. McArdle, a health policy expert at Hewitt Associates, a benefits consulting firm, said, "Wellness and prevention programs have become a mainstream part of the benefits offered by large employers, and it's virtually certain that Congress will include incentives for such programs" in its bill. The goals of such programs are to help people control blood pressure, fight obesity and manage diabetes and other chronic conditions.

Under Mr. Harkin's proposal, employers could obtain tax credits for programs that offer periodic screenings for health problems and counseling to help employees adopt healthier lifestyles. Programs could focus on tobacco use, obesity, physical fitness, nutrition and depression, he said.

If, for example, an employer pays the cost of gym membership for employees as part of a wellness program, the payment is often counted as taxable income to employees.

Helen Darling, president of the National Business Group on Health, which represents 300 large employers, said, "We would like Congress to change the law so it would not be taxable income if an employer provides a benefit to help employees stay healthy."

Employers who reward healthy behavior may also run afoul of a 1996 law intended to prevent group health plans from discriminating against people because of their health status or medical history.

If an employer offers financial incentives to employees for lowering cholesterol, losing weight or stopping smoking, the amount of such rewards generally may not exceed 20 percent of the cost of coverage.

Many employers would like to offer larger incentives, and many in Congress want to let them do so.
Source: IHRSA