Wellness Programs

While there are many types of wellness programs, along with just as many incentives to adhere to them, the basic idea of all of them is that physical activity has a positive influence on your health. In fact, increased physical activity has been shown to reduce the risk of strokes, type 2 diabetes and heart disease. Of course, physical activity can also help beat one of America's growing epidemics: obesity. While these facts might be well known, Americans continually reduce their physical activity levels. In 2005, 39.9 percent of adults spent the majority of their day sitting, an increase from 36.8 percent in 2000. The percentage of those adults who didn't do any physical activity during their leisure time increased from 38.5 percent in 2000 to 40 percent in 2005. Along with these increases, there's one decrease: the percentage of adults who have a high level of physical activity has dropped from 18.7 percent in 2000 to 16.7 percent in 2005 [source: CDC].

That's where the wellness programs come in. Businesses or insurance companies can start wellness programs catered to their employees or customers. At the very least, a wellness program usually addresses both physical and emotional issues, including smoking cessation support, stress management services like therapy or yoga, weight loss plans and exercise programs (by offering discounted or free gym memberships). Others may have more comprehensive plans that also include disease management for at-risk people, personalized nutritional services, family and personal therapy, and a variety of education programs focusing on wellness. Some wellness programs may even include stress-reducing massages, safe driving classes and ergonomics training to keep people from injuring themselves or suffering from daily fatigue due to a poor workplace setups.

Unfortunately, getting into shape isn't enough incentive for most of us to actually use wellness programs. So businesses and insurance companies have a well of rewards for people who use the programs successfully. Participants can get rewards for attending educational health programs or  reaching health goals, like lowering blood pressure. Rewards can include cash, toys such as iPods or exercise equipment, and even vacation days. Often, rewards will focus on health care needs -- they can include a deduction in insurance premiums or flexible dollars that can be used for medical expenses. The bottom line is the more people use wellness programs, the bigger the rewards get.

Now that it's clear why you should take advantage of these wellness programs, let's find out why businesses use them in the first place.

While wellness programs sound great to most employees, companies can spend millions of dollars on them. Despite this, more than 80 percent of American businesses with more than 50 employees have some sort of wellness program [source: The Wellness Councils of America]. So why do they spend all this money? The answer is simple: They do it because it's good business. Employees with poor health can cost a company a lot more than healthy employees do. In fact, many companies spend half of their corporate profits, or more, on medical costs for employees in poor health. However, most companies with successful wellness programs enjoy less absenteeism, higher productivity, lower incidences of job injuries, less employee turnover and fewer medical claims.

According to the National Safety Council, nearly one million workers a day are absent due to stress, costing American companies nearly $300 billion a year in loss of productivity and the cost of temporary help [source: Risk & Insurance]. Therefore, a wellness program that includes stress management services could potentially save a company a lot of money. Likewise, helping an employee quit smoking not only improves his health but also can increase productivity by eliminating frequent smoke breaks. Smoking-related health complications would also be reduced, cutting down on doctor visits. In fact, the use of tobacco, alcohol and other drugs costs American companies approximately $100 billion annually [source: The Wellness Councils of America]. Therefore, any wellness program that includes cessation of these vices makes good medical sense for the employee and good financial sense for the employer.

One of the best incentives for businesses is that more healthy employees can mean less monthly premiums for health insurance benefits. This is because health insurance companies charge a company premiums based on the amount of health claims they receive from that company. Because healthy employees visit the doctor less, health claims are reduced, and so are premiums. In 2006, employer insurance premiums increased 7.7 percent -- that's twice the rate of inflation [source: National Coalition on Health Care]. With a wellness program in place, many companies have reduced this premium increase to a mere 2 percent to 3 percent [source: Microsoft].

Clearly there are huge advantages for businesses to have wellness programs, but why do insurance companies offer them? Find out in the next section.

Insurance companies offer wellness programs for many of the same reasons as other companies do. Of course, the prevailing reason is lower costs to the insurance company. It's estimated that nearly 80 percent of all health insurance costs are a result of those with chronic conditions [source: The Wellness Councils of America]. Many of these conditions are preventable with proper nutrition, exercise, weight loss and smoking cessation programs.

While big companies can afford to offer expensive workplace wellness programs, many smaller businesses simply can't. That's where health insurance companies come in. They can offer wellness resources such as wellness coordinators, implementation of wellness programs in the workplace and health assessment tools. Because health care companies often have alliances with health care providers, their wellness programs can often take an extra step. For example, when you fill out a health assessment questionnaire, an insurance company can send it to your primary care physician. This lets your doctor keep an eye on your risk factors  and give you support in reaching your goals.

Accreditation is another huge incentive for health insurance companies to offer wellness programs. The National Committee on Quality Assurance (NCQA) is a national accreditation organization for Managed Care Organizations (MCOs). In order to receive this accreditation, the insurance companies' MCO plans must have preventable health services, which often include wellness programs. While this accreditation isn't mandatory for insurance companies, many employers require it before they even consider using a certain health plan. Therefore, wellness programs can give an insurance company a competitive advantage over those companies who don't offer them.

Like businesses, health insurance companies offer customers incentives to use their wellness services. They often include discounts, cash or prizes that are awarded to customers who fill out health questionnaires, exercise for a defined amount of time or participate in weight loss programs.

However, there are disadvantages to health insurance wellness plans. Smaller businesses that only offer one type of plan. And while workplace wellness programs may eventually reduce health care premiums for a company and their employees, the premiums for an insurance plan that offers wellness may initially be high. Thus, many employees will simply switch to a lower cost plan with no wellness options.

You can find more information on wellness programs and related topics on the next page.