American workers have skin in the game. Employees in the United States are bearing a far greater responsibility for their healthcare costs than they have in the past. In a growing era of personal responsibility, wellness and prevention programs are finding a favorable reception among employers. Employees are also demonstrating an increased appetite for wellness, prevention, and fitness programs which can reduce costly out of pocket medical expenditures. The recognition that better health can favorably impact one financially both today and into retirement is growing in the public consciousness and fueling the trend. Workplace sponsored wellness programs champion healthy lifestyle choices while potentially reducing medical expenditures and disability-related costs and absences for employees and employers alike.


Creative Solutions to Curbing Costs

The Department of Health and Human Services projects America's national healthcare costs will reach $4.1 trillion by 2016, nearly doubling the projected expenditure for 2008 of $2.4 trillion. While the burden of healthcare costs used to fall mostly on employers, the dramatic increases have made it necessary for employees to share some of the burden.

Without an employer's advocacy of a culture of wellness and prevention, shifting more of the cost of health care to employees is, in fact, only a short-term temporary solve. Health and wellness programs and education are a proactive and sustainable step employers can take that can benefit all stakeholders - including society at large.

Employees' health can also impact their wealth. Good, as well as poor, health practices have a personal financial consequence. Taking active steps to improve one's health can help mitigate illness and disability-related circumstances that can affect a person's financial safety net and premature withdrawal of savings. This is true both for the short term and for the long term. It is a reasonable assumption that a person in good health will have fewer doctor visits, out-of-pocket prescription drug costs, hospitalizations and a decreased risk for certain chronic diseases. They will typically have a longer, more productive work span because they are likely to experience fewer medically-related absences and/or disabilities of shorter duration. Better health can also mean a more financially secure retirement - and one of better quality.

Employers are increasingly looking beyond their health carriers and taking a more proactive approach to craft wellness and prevention initiatives that can work together with their health plans. They are also leveraging traditional financial solutions such as annuities, disability and long term care insurance and financial planning to craft a culture of health and financial security that helps protect the financial futures of employees. It is noteworthy that employers have begun a shift away from a health infrastructure that rewards acute and tertiary care to one that encourages wellness and prevention. According to MetLife's 5th Annual Employee Benefits Trend Study, approximately one-third (28%) of all employers - and 57% of large companies - currently offer some type of wellness plan.


Well-Designed Wellness Programs

Wellness programs can take on many forms, from promoting the adoption of healthy decisions - the carrot approach - to measures that penalize unhealthy habits - the stick. The carrot approach is more prevalent. An increased number of employers are rewarding employees when they implement positive aspects of the wellness program. This trend is growing. According to MetLife's 5th Annual Employee Benefits Trends Study, 17% of employers offer health insurance credits for employees following wellness guidelines such as exercise, nutrition, check-ups, and disease screenings. Nearly one-third of employers with 500 or more employees (31%) are offering these wellness credits - up from 25% a year before. On the other hand, one-in-ten employers (9%) and one-in-five (19%) of employers with 500 or more employees say they impose financial penalties on employees for not following wellness guides.

These wellness programs are designed to improve employee morale, loyalty, and productivity. Onsite employee health programs and facilities are a growing trend that reflect a momentum of bringing wellness and preventive health to the workplace. Other onsite programs include:

" Smoking cessation
" Fitness Center
" Cholesterol monitoring
" Health Fairs
" Nutrition consultation
" On-site weight management
" Health risk assessments
" Health screenings
" Stress management

Employers are also implementing other new programs that complement the services provided by traditional health carriers. These include a variety of additional solutions, such as nurse help-lines, disease management and patient advocacy agencies. Among respondents to the Employee Benefits Trend Study:

" 35% of employers fund employee assistance programs, up from 25% the prior year. For companies with 500 or more employees this number has grown from 46% in 2005 to 58% in 2006.
" 17% of employers - and 34% of employers with 500 or more employees - offer targeted prevention programs.
" 14% of employers - and 28% of employers with 500 or more employees - provide onsite clinics.
" 15% of employers - and 29% of employers with 500 or more employees - offer health care advocacy.


Healthy Can Also Mean Happy

As Americans are living longer, it is important to instill a culture that focuses on wellness and prevention earlier in life. Taking care of oneself during the working years is an excellent way to mitigate future medical costs.

Health and wellness programs in the workplace present a real opportunity for employers to help themselves meet their long-term goals as well as those of their employees. While MetLife research reveals that employee retention is the major benefits objective for employers, controlling costs is a close second. The research also reveals an apparent correlation between benefits satisfaction and job satisfaction. These findings underscore the importance for employers to strike this balance and utilize benefits strategically to achieve both objectives.

Employers who invest in targeted wellness and prevention programs may be able to offset future spending to treat chronic medical conditions. Employees that are educated about these programs and their own health risks can take steps to mitigate some of their potential financial exposure. Wellness and prevention benefits and programs can be mutually beneficial for both employees and employers in terms of saving long-term dollars and enjoying greater workplace productivity. They can also help increase employee satisfaction with their benefits offerings. MetLife has found that many employees who are highly satisfied with their benefits also feel strong loyalty to their employer - and also feel that benefits are an important reason why they remain with the company.

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[1] U.S. Department of Health and Human Services, National Health Expenditure Projections 2006-2016