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For Businesses, Healthy Employees Pay Off – Literally

freedom-happiness-11061502 . / Credit: Deamstime

Businesses are upping the ante in their efforts to make their employees healthier, new research finds.

A study conducted by Fidelity Investments and the National Business Group regarding health shows that over the past several years, most businesses have steadily increased the dollar value of the incentives they offer employees to participate in health-improvement programs, such as weight-loss advice, managing insulin treatments and getting on-site flu shots.

Nearly 75 percent of companies used an average of $460 per employee in incentives last year to engage employees in health improvement programs – up from $430 in 2010 and just $260 in 2009.

The employers relied on different types of perksincluding cash, gift cards and contributions to health savings accounts, according to the study.

The monetary motivation appears to be paying off, with nearly 60 percent of the businesses surveyed believing their incentive-based programs had a better-than-expected success rate at increasing employee participation.

Incentives have come a long way from a free T-shirt and a water bottle, according to Adam Stavisky, senior vice president of Fidelity's Benefits Consulting business.

"As companies have increased their commitment and investment in health-improvement programs, they have made their incentives more enticing," Stavisky said. "They have also learned which programs resonate best with their workforce, whether that involves on-site flu shots or weight-loss challenges."

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The research also found that more companies are requiring employees to participate in work-sponsored wellness programs in order to qualify for medical benefits. Five percent of the surveyed companies required their workers to complete biometric testing, such as cholesterol screening, and 7 percent required completion of a health-risk assessment to be eligible for medical benefits. Those numbers are expected to increase to 9 and 10 percent, respectively, this year.

"This isn't surprising given how much control employees can have over their own health and how much poor health habits cost employers," said Helen Darling, president and chief executive officer of the Business Group.

The study suggests many businesses – more than 75 percent – don't know the return on their investment in health-improvement programs.

  • To help employers maximize the impact and effectiveness of their offerings, Fidelity and the National Business Group offer several suggestions, including:
  • Secure commitment from senior management: Employees are more likely to engage when there is encouragement from senior executives.Align programs with the health risks and challenges of the workforce: Determine what employees' pressing health issues are and offer solutions.
  • Set realistic goals and measure results: Define the desired behavior, such as weight loss, and track it.
  • Offer incentives that appeal to employees: Collect feedback from the staff on what is appealing and discontinue incentives that aren't working.
  • Manage vendors by establishing performance requirements: Employers should consolidate employee data collected from multiple vendors and measure the results. Vendors should be held accountable if the results fall short of objectives.

The study was based on surveys of 139 companies from numerous industries including transportation, health care, technology, entertainment, consumer products, retail and energy.

Chad Brooks is a Chicago-based freelance writer who has worked in public relations and spent 10 years working as a newspaper reporter and now works as a freelance business and technology reporter. You can reach him at chadgbrooks@gmail.com or follow him on Twitter @cbrooks76.

Chad Brooks

Chad Brooks is a Chicago-based writer and editor with nearly 20 years in media. A 1998 journalism graduate of Indiana University, Chad began his career with Business News Daily in 2011 as a freelance writer. In 2014, he joined the staff full time as a senior writer. Before Business News Daily, Chad spent nearly a decade as a staff reporter for the Daily Herald in suburban Chicago, covering a wide array of topics including local and state government, crime, the legal system and education. Chad has also worked on the other side of the media industry, promoting small businesses throughout the United States for two years in a public relations role. His first book, How to Start a Home-Based App Development Business, was published in 2014. He lives with his wife and daughter in the Chicago suburbs.