Increasingly, corporations are adopting plans to encourage their workers to quit smoking, exercise and otherwise improve their health. But not everyone agrees these plans make economic sense.
Yes.Some health-promotion programs do save money. Others don't.
Would you expect passing out some pamphlets on hypertension to reduce blood pressure significantly? Pamphlets alone probably won't do the job. Yet in the eyes of some that may be a hypertension program. Others provide comprehensive programs that assess health problems among employees and deal with them. There's evidence that the best of these can get employees to control their hypertension, quit smoking and start exercising.
Programs that can save money must take consumer marketing approaches into account because they have to be "sold" to employees. If you get 25 percent participation, it's a lot harder to obtain savings than if you're getting 70 or 80 percent.
The most careful, multifactorial study on such savings was done by an independent group from the Wharton School of Business on hospital costs. For more than 11,000 Johnson & Johnson employees exposed to the Live for Life program, which offers health screening and life-style improvements, savings per employee averaged more than $150.
Against an expense of $100 to $120 per participant, that's a significant rate of return. We're now analyzing other savings from the program, such as reductions in absenteeism, worker's compensation and short-and long-term disability. It looks very promising. Increases in job satisfaction, morale and loyalty are harder to count in dollars, but I know they're worth a lot to the line managers I talk with.Dr. Jonathan Fielding-vice president and health director, Johnson & Johnson Health Management Inc.; professor of public health and pediatrics, University of California at Los Angeles; member, U.S. Preventive Services Task Force, Department of Health and Human Services
No.The best studies of prevention are on a national scale and include the whole population, not just employers and employees. Evidence from such research is that prevention programs don't save money but actually cost money. That's not to say they don't make people healthier and get them to live longer. The evidence is they do. But you have to pay for it. Nobody has shown corporate wellness programs save money. The few studies done give only pieces of the puzzle.
A study of Johnson & Johnson's Live for Life program, published in the Journal of the American Medical Association, indicated that it saved money through reduced hospitalization. But the article doesn't say how much the program cost, so we can't tell whether it saved money over all.
Further, there was such incredible variation in hospital use from year to year that I find it hard to believe the slight trend means anything, let alone that it reflects a wellness program.
Also, such studies don't look at the impact on expenses of employees or any payers but the corporation. If there's more outpatient care when people don't go to the hospital as much, for example, employees may end up paying more out of their pockets because such expenses aren't as well insured.
I would urge firms and their employees to keep their eyes open to the full costs. But even if the programs cost money rather than saving it, that doesn't necessarily mean a corporation shouldn't go ahead with one.
Fringe benefits traditionally have been created to attract employees and help keep them -- not to save money for the firm. Dr. Louise Russell research professor of economics, Institute for Health, Health-Care Policy and Aging Research, Rutgers; member, U.S. Preventive Services Task Force, HHS
(c) 1988, Physician's Weekly, a Whittle Communications Publication; reprinted with permission