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Wellness May Get Better

Lawmakers propose tax credits for companies establishing employee wellness programs. But do workers even care about wellness?
Laura DeMars, CFO Magazine
October 19, 2007

Although the concept may be amorphous, "wellness" programs may get a very tangible boost from Congress. Senators Tom Harkin (D–Iowa) and Gordon Smith (R–Oreg.) are cosponsoring a bill that would provide tax credits of up to $200 per employee for companies that establish programs to help employees stop smoking, lose weight, monitor high blood pressure, and tackle sundry other preventive aspects of health care.

Even with the tax break, such programs represent a leap of faith. Employees often fail to stick with them long enough to show results, and calculating the return on investment can be difficult. Only one in seven companies manages to do it, and those that have found a positive result tend to be self-insured firms that can measure a drop in health claims paid.

The best wellness programs, according to Bruce Kelley, a senior consultant with Watson Wyatt Worldwide, "focus on the top medical conditions that affect your particular workforce." Other keys to success, according to John Asencio, a senior vice president at Sibson Consulting, are good data collection, consistent participation (which may hinge on incentives), and corporate culture. "If turnover [at the company] is high," he says, "employees probably won't stay long enough to make a true impact."

Worthington Industries, a metal processor with 8,000 employees in 63 plants, has offered an everexpanding range of incentive-based wellness programs for four years, and says it has achieved a 200 percent return on its investment. Even so, its participation rate has flattened at about 60 percent.