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The importance for any business of establishing ROI around health and wellness costs can hardly be overstated. As the Affordable Care Act brings changes — and as employees bring new benefits expectations — business leaders need to stay on top of their math.
Mark Chasen, CEO of AWE Global, Inc., writes in the Huffington Post that “the ROI on comprehensive, well-run employee wellness programs can be as high as 6 to 1 (Harvard Business Review, 2010) and eco-conscious, sustainability programs on average have a ROI of 2 to 1 (Bloomberg, 2011).”
However, Chasen adds that “despite the groundswell of evidence supporting the profitability of health and sustainability programs, many executives today are stuck in an old mindset that categorically views such programs as ‘fluffy' cost centers not profit centers.”
To help clarify, the piece provides examples of companies that have integrated various wellness activities into their employee management: “As leading companies such as Google, Zappos, Whole Foods, GE, Microsoft, Cisco and Nike have successfully demonstrated the pragmatism of valuing employees with such things as a healthy culture (e.g., exercise, nutritious food, live-work balance, child care, telecommuting), generous health plans and social responsibility, enterprise is waking up and starting to get healthy — because it makes good business sense.”
“According to Forbes, the current healthcare spend in the U.S. is a crippling $3.8 trillion. About 70 percent of the diseases contributing to this crippling cost are avoidable with preventative measures including heart disease, obesity, diabetes, osteoporosis, insomnia, depression, chronic back pain and muscle spasm. And most of these diseases are incubated in a sedentary, stress-filled, junk-food eating and dehumanizing work environment.”
“Aon Hewitt's analysis showed the average health care cost per employee was $10,471 in 2013. When added to Mercer's estimates of an average of $14,000 per employee per year resulting from absenteeism and inefficiency, the total is $24,471 on average per employee per year. It's pretty astounding what poor health is costing both enterprise and society.”
Chasen's conclusion is clear: “It doesn't take a genius to figure out that integrating exercise and movement with healthy eating, stress reduction and social connection into the workplace will substantially reduce health care costs and absenteeism while increasing productivity, efficiency and morale. A winning formula for increased profits is to foster a healthy, whole and happy environment for employees to thrive.”
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