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How Corporate Wellness Programs Affect the Bottom Line
For every dollar spent on wellness programs, companies can expect to save three and a half times their investment
Companies need to be concerned with the health and wellness of their employees. Workplace injury, illness, declined productivity, and absenteeism are all problems that result in added costs to employers. All organizations suffer from these issues, which can destroy employee morale and, subsequently, your bottom line. These challenges are all manageable by systematically reducing risks and emphasizing safety and wellness.
A Harvard study found—and cost control modeling predicts—that medical costs for businesses decrease about $3.27 for every dollar spent on wellness programs. Additionally, absentee costs decrease by about $2.73 for every dollar spent. This average return on investment (ROI) suggests that the wider adoption of such programs benefits budgets, productivity and employee health.
Hidden Costs of Workplace Injury
There are direct and indirect costs associated with workplace injuries. These costs depend on several factors. A Stanford University study estimates that direct costs on a claim for an employee bone fracture are $50,000 in addition to indirect costs on that same claim, which can add up to an additional $55,000. That’s a substantial amount of money for any company to absorb.
Indirect costs include:
-Wages paid outside of workers’ compensation payments
-Costs of wages from time lost
-Overtime costs from other employees making up for missing productivity
-Productivity reduction from assumption of new roles, scheduling
-Repair and replacement of damaged work area associated with the injury
-New and replacement hire costs
A long-term direct cost is in your workers’ compensation insurance premiums. There can be a substantial premium increase with each injury. For example, a discount for remaining claim-free can be as much as 40%. With a single injury claim, a policy with a value of $100,000 annually (inclusive of discounts) can raise to $115,000, and more with each subsequent injury. That rate will last at least 3 years before the discount can be offered again, for a total additional cost of $45,000 in added insurance costs for just one injury.
Illness Can Plague Your Business
Ill employees are not productive—plain and simple. But what really makes employees sick? Poor diet, un-managed stress, and lack of physical activity are hands down the biggest culprits in predicting illness and absenteeism.
Mitigating this risk through interactive programs and systems designed to keep employees educated and aware of their personal value for wellness has proven to be the most effective approach.
In fact, of the top 100 companies in the world, more than 80% actively maintain comprehensive wellness programs that actively and repetitively emphasize prevention through training and other programs. These organizations not only see boosts in productivity, but reduced absenteeism, turnover, and increased job satisfaction.
Prevention is crucial here. Development of a wellness program, inclusive of injury and illness prevention techniques and training, is necessary to reduce that risk.
10 Ways to Keep Your Company Well
1) Develop a comprehensive and compliant wellness program.
2) Consistently train staff and appoint “safety officers” who can keep awareness top of mind for the whole team.
3) Hold safety meetings for your entire staff—quarterly at minimum, ideally monthly.
4) Develop and maintain an accident response protocol.
5) Maintain active communication to employees on health, safety, and wellness topics.
6) Create and promote programs that promote health (i.e., weight loss, smoking cessation, etc.).
7) Create and promote activity programs that build team morale while promoting health.
8) Employ health risk assessments, (i.e., ergonomic evaluation, work station assessment, etc.).
9) Invest in incentives to reward and remind team members about health, such as awards, bonuses, or giveaways of health-related items (i.e., water bottles, pedometers, etc.).
10) Develop and maintain tracking and survey protocols to ensure efforts are effective and employees receive continued value.
There are, however, expected costs associated with creating and implementing a wellness program.
Wellness Program Options
A wellness program coordinator has an average salary of $75,000 annually. When factoring in additional costs of employment, insurances, and benefits, an organization can expect to pay between $93,750 and $105,000 annually for that single hire to maintain company wellness and safety programs. Certainly, the ramp up time for program development and implementation can be several months to a year.
Bypassing the need to hire a wellness coordinator as an employee, Mission Wellness can provide consulting on an as-needed basis based on what works for your unique company.
The Mission Wellness Approach
With established—yet customizable—systems in place, starting or revamping your organization’s wellness program is quick, efficient, and affordable. Program design and implementation is our specialty.
Through an assessment of your current systems and needs, we create, advise, and implement programs and systems that fill any voids in your current approach. We can also jumpstart a new program to get your company to adopt a wellness culture, as outlined in “10 Ways to Keep Your Company Healthy.”
We get your organization well while you focus on your business, reducing your costs without delays or major ramp up periods.