Home » Investing in Employees’ Health

Investing in Employees’ Health

By wmadministrator

Rob Mattingly, a design technician at Sumitomo Electric Wiring Systems in Bowling Green, strolled into his company’s first health fair in 2005 as much out of curiosity as anything. In his mid-30s, Mattingly was the picture of health: almost 6-foot-3, 180 pounds, a weightlifter who ran and walked regularly.

Mattingly was mostly interested in finding out his Body Mass Index (BMI), but he stopped along the way to have blood drawn for a wellness panel, a screening that measures cholesterol levels and other indicators of basic health.

A few weeks later, Mattingly was diagnosed with thyroid cancer. The blood work revealed that his thyroid stimulating hormone (TSH) was too high. He was referred to a specialist, who found a cancerous nodule on his thyroid gland. Two surgeries followed, but today Mattingly is cancer free.

Company health fair outcomes are not typically this dramatic, but these fairs are a staple in what is quickly becoming a must-have in the business world – a worksite wellness program.

In a survey of more than 500 major U.S. employers, Hewitt Associates found the number of companies using wellness and disease-management programs increased from 73 percent in 2004 to 83 percent in 2005. The survey also found 30 percent of employers offer incentives to encourage employee participation in wellness programs, up from 21 percent in 2004.

In Kentucky the numbers aren’t so high. In a recent statewide survey, only 34 percent of Kentucky companies said they had a worksite wellness program, according to Teresa Lovely, business coordinator for worksite wellness development with the Partnership for a Fit Kentucky program.

Worksite wellness efforts are one way employers are trying to rein in the spiraling cost of health insurance — $7,982 per employee at major companies, according to Hewitt Associates, and increasing each year, up an average of 5.3 percent in 2007. The programs also target health concerns such as obesity and smoking that often are the underlying cause of serious chronic illness as well as persistent workplace problems such as absenteeism that buffet employers.

Return on investment
Employers are encouraged by studies such as one by Steven Aldana, Ph.D., in the American Journal of Health Promotion that found a $3.48 return for each $1 invested with 32 programs he followed for more than three years. Some reports find even higher ROIs. A 2003 report by the U.S. Department of Health and Human Services detailed a comprehensive wellness program at Motorola Inc. that reported a $3.93-to-$1 ROI. A $3.11 ROI is considered the industry median today, according to Hewitt Associates.

Back at Sumitomo, Jeanie Kelley, corporate RN and head of the company’s wellness program, said they started putting a plan together in 2004 for the 1,200 employees at the company’s three Kentucky sites. The health fair Mattingly attended was the official kickoff.

Nearly half of Sumitomo’s employees – 562 to be exact – took advantage of the wellness plan the first year it was offered. Sumitomo’s program includes lunchtime learning sessions, weight loss classes, a walking program, smoking cessation classes and a monthly newsletter. The company has a physician come in weekly and employs nurse practitioners at every site to handle minor illnesses.
Sumitomo, a Japanese-owned company that manufactures electric wiring harnesses for the automotive industry, budgets $200,000 annually for the worksite wellness program, but Kelley said it is an investment rather than an expenditure.
“In the first seven months of the program, we saved close to $10,000 on health care premiums,” Kelley said.

She figures the company saves handsomely by having an in-house clinic, an emerging trend in worksite wellness plans. For example, at Sumitomo, staff nurses can perform wellness panels for about $38 in labor and materials. Otherwise each test would cost approximately $200. Multiply that difference by the number of employees and it tallies $27,000 in savings.

Similarly, Kelley estimates it costs approximately $67 for a routine physician visit, which the company physician can perform for $25. In the past three months, Kelley said the company has saved $33,894 by performing many of these physicals in-house. She arrives at that figure by determining labor costs (a physician and the nurses), figuring in the difference between in-house and out-of-house physician visits, then subtracting three hours of wages for each visit, time the employee would otherwise have been off work.
The program has also proven successful from an employee health standpoint. At Sumitomo, 50 percent of associates with high blood pressure have improved their readings, some no longer need diabetic medications, and 150 employees who took part in a weight loss program collectively shed 1,500 pounds.

Leading the way
One of the bellwethers in worksite wellness is Logan Aluminum in Russellville. Howard Leach, then the company’s human resources manager, testified in 2004 before the Joint Economic Committee of the U.S. Congress about the success of the company’s consumer-driven health care program. Logan Aluminum is also featured as a case study on the Web site for the Wellness Council of America (WELCOA).

Logan Aluminum started its wellness program back in 1993, long before most companies, and has been blazing the wellness trail ever since. Johnny White, who heads the program as employee relations representative, calls the company’s approach “proactive.” The company backs that up by plowing $750,000 annually into its wellness efforts.

The worksite wellness plan at the aluminum mill was initiated at the same time the company was switching to a form of health care management called consumer-driven health care. At Logan Aluminum, this means employees do not pay a monthly contribution or payroll deduction for health care.

Instead, the company offers employees the choice of a health fund or a health savings account (HSA). If the employee completes a confidential health risk assessment, the company contributes $1,100 toward the worker’s $2,700 family deductible each year. Employees are responsible for the remaining $1,600 deductible, which covers them and their family. Employees determine how they spend their health care dollars. If they have a good year and need less than $1,100, any remainder rolls into the next year, when the company contributes another $1,110.

There are rollovers because the company provides a striking list of health-related services at no cost to employees – vision screening, allergy injections, mammograms, colon cancer screenings, annual spouse health fairs, chest X-rays, annual blood tests, any doctor-requested blood work, STD case management, and a preventive medical and pharmacy program.

It also offers 500 hours of health and wellness education a year, some taught by area physicians.

Content for the classes is driven by employees’ health risk assessments, according to White. The company receives an aggregate health report on its employees (no individual results) and designs incentives to address common problems that result in high-cost claims such as heart attacks.

“We want to make sure our employees have enough information to be wise spenders of health care dollars,” White said.

Then there are the in-house fitness activities. The western Kentucky company has three fitness trainers available for one-on-one consultations on everything from weight lifting and kick boxing to cardio and total body workouts. Yoga classes are regular fare, as are aerobic classes.

These take place at two fitness facilities on site that are equipped with treadmills, elliptical trainers, free weights and cardio and nautilus equipment. There is a three-mile nature walking trail behind the plant as well as a paved one-mile track. The company even moved one of the fitness facilities to make it more convenient for employees.

“We try to eliminate as many barriers to participation as we can,” White said. “The fitness facility was on the other side of the plant and employees had to leave the grounds and drive to it. We moved it to the administration building, which every employee has to walk through to go home. It is connected to the locker rooms. They can put their gym clothes on, work out, take a shower and go home.”
Since the facility was moved, usage went from 500 visits a month to 2,000.

The factory employs two full-time nurses and contracts with a physician and a registered dietician. Employees may get a complete physical free each year, and 96 percent do so. If a problem shows up – say triglycerides are high – a nurse consults with the employee, showing him or her how to solve the problem. Employees also can turn to a 24-hour nurse hotline with questions or concerns.
The company’s carefully planned collection of efforts has saved the company well over $1 million since 1993, according to White. The wellness program boasts a most impressive 5-to-1 ROI rate.

Annual incentives are also a part of the plan. This year, the company has an Olympic-style theme for its incentive program. Rewards are up to $300 for “gold medalists.” The competition includes seven measures of health: BMI, blood pressure, fasting glucose, HDL, LDL, triglycerides and exercise. Employees who quit smoking for one year can also earn an extra $100, and employees who attend six hours of wellness education get a $40 reward.

Companies have found that such carrot incentives work better than sticks, according to Ronny Krishana, vice president of sales and marketing for Wellfolio, a company that sells software and Web-based tools to help employers motivate and support employees’ efforts to get healthier.

“Motivation and support are the two requirements for a good program,” he said. “You can have the best-designed program in the world, but unless you get employees engaged and participating, it doesn’t matter.”

“People just have issues”
Support is behind another emerging trend in worksite wellness programs – addressing mental health issues as well as physical ones.

“It used to be that employers told employees to check their life at the door,” said Bret Melrose, owner and president of Fayette Heating and Air, a 38-year-old family-owned company in Lexington. “That’s an impossibility now. With all the issues families have to deal with and with both parents working, people just have issues.”

To help his 100 employees deal with those issues, Melrose spends $200 per employee each year on a new service called Corporate CAREWorks of Kentucky.
“We are an employee-care program rather than an employee assistance program (EAP),” said Todd Layne, owner of CAREWorks. “Instead of employees going to the care, the care comes to them.”

Two weeks after joining Fayette Heating and Air as a service technician, Richard Corley III went on a weekend fishing trip to Indiana. He and a buddy started cooking a meal when the door of the cook stove flew open and flames shot out. Corley received second- and third-degree burns over 30 percent of his body and spent the next weeks in a Louisville burn center.

Layne showed up at the hospital a few days later and visited Corley once he went home.
“Todd helped me through a difficult time,” Corley said. “He sent messages back and forth to work. He made it easier to go back to work.”

Layne works with 13 central Kentucky companies of all sizes, including S&S Tire, Dean Dorton and Ford, and W. Rogers Company. He started CAREWorks in 2005 after discovering that only 5 to 12 percent of employees make use of EAPs, even when they really need help.

“I try to bring the employer closer to the employee,” Layne said. “I think we help real people with real life.”

Ask Melrose what his company gets out of it and he reacts instantly: “productive and loyal employees.”

“If they are healthy mentally and emotionally, we get a productive employee,” Melrose said. “They are not missing days, not depressed. They are able to go to the customer and give him the best each day. We are not constantly retraining. Rather, we are investing in our people and keeping them moving forward. I think we get a 10-to-1 investment. Some things are priceless.”

Melrose also attributes his low turnover to programs such as this. In the 100-person company, Melrose said he has five second-generation employees and one third- generation employee.

“These programs instill community and commitment to the company and loyalty,” he said. “If they realize you care about them, they will care back.”
Another benefit to Melrose is that he and his managers no longer have to be “amateur psychologists.”

“Todd gets to know each employee,” Melrose said. “He is a part of our team, but he is not a boss and not a co-worker. It’s unbelievable what employees tell him. They tell him everything, and he is there to help them sort through it… marital issues, drug problems, death, illness. They might not have the wherewithal to hire a psychologist or go to doctor to get medications. This is true help.”

Kentucky-based health insurance giant Humana has also found this new approach a smart way to keep its 22,000 employees (about 9,000 in Kentucky) on the job and productive.

Its version is called Work/Life. Employees can call a counselor for assistance with anything from finding a babysitter if the regular one can’t come to coping with the conflicting demands of simultaneously caring for teenage children and aging parents.

New twists on familiar problems
Humana also offers employees and members of its health insurance plans a plethora of wellness choices from popular health risk appraisals to biometric screenings to telephonic health coaches to new twists on solid ideas such as their HealthMiles program, a way to encourage the proven health benefits of walking.
Head to a Humana fitness center at lunch and you’ll find sneaker-clad employees, pedometers attached to their gym clothes, lined up on the treadmills.

“The pedometer links into their computer at work or home,” said Phil Smeltzer, Humana’s wellness strategy leader. “They can upload how many steps they have taken during the day. The more steps, the more rewards.”

Smeltzer said a typical goal is 10,000 steps per day, and rewards come in the form of cash cards to use at popular stores. Some 7,000 employees nationwide are participating in the program.

“This program has changed the culture within Humana,” Smeltzer said. “People have started paying attention to how many steps they are taking. When it gets late in the day and they haven’t walked enough, they take the long way to their car. And instead of talking about who got voted off “Dancing with the Stars” last night, they are talking about how much they have walked.”

The overarching goal is participation, according to Smeltzer.
“The biggest factor in success is participation,” he said. “If you get up to 70 percent of employees participating, you can virtually guarantee it will have a positive impact on medical expenses.”