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Corporate wellness programs: How well are they working?

Written by Diane Archer

You might think that workplace wellness programs would be valuable financially and clinically for workers; after all, it’s a $6 billion a year industry. But, that’s not at all clear. Moreover, in some cases, they may impose a large financial burden on workers who don’t participate, undermining their access to care. And, they sometimes are at odds with the Americans with Disabilities Act.

The Affordable Care Act incents employers to offer wellness programs to their workers. Employers may use benefits or penalties to encourage employee participation in wellness programs, including as much as 30 percent of the employee health insurance cost. And, employers like them because they see them as a way to save money.

How workplace wellness programs are designed matters. They need to be structured to improve employee health. And, under the law, they must be voluntary.

In fact, the Equal Employment Opportunity Commission has filed suit against Honeywell International alleging that its corporate wellness program is not voluntary. At Honeywell, employees who refuse to get their blood drawn may pay a $500 additional health insurance premium and lose up to $1500 in contributions to their health savings account. According to the EEOC, Honeywell’s program design requires participation and therefore violates the Americans with Disabilities Act.

Opponents of wellness programs argue that a high penalty on workers who don’t participate in the company’s wellness program is likely to undermine workers’ access to affordable care. According to RAND, which studied corporate wellness programs, fewer than half of employees eligible participate in these programs.

The EEOC needs to clarify what makes a wellness program voluntary or not. Nearly nine out of ten big companies (with 500 or more employees) have wellness programs for their employees and overall about half of U.S. employers.

Moreover, there is little evidence that wellness programs even work. The RAND corporation did a study that was public for a brief period, which revealed that the workplace wellness industry wasn’t effective either clinically or financially.

A RAND report that is now public talks about “statistically significant” and “clinically meaningful” improvements in exercise frequency, smoking cessation and weight control, but the numbers do not appear to bear that out.  But, RAND found that most workers do not participate in these programs. And, participants in these programs were found to lose less than one pound a year. RAND had data from only one employer, a tiny sample, when it looked at exercise frequency and smoking cessation. Moreover, RAND found no statistically significant reduction in either hospital or emergency department use or in health care costs ($157).

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