The ROI of Workplace Health Management

Workplace health promotion and its return

Throughout Europe we observe significant increases in chronic diseases due to poor lifestyle choices and work induced ill health. This trend not only increasingly affects the quality of life but is also detrimental to the level of workability of employees. Chronic illnesses exact a heavy toll on businesses. Besides the fact that chronic disease accounts for the lion’s share of healthcare costs in developed markets and, increasingly, emerging markets, it has an equally significant impact on employee productivity, through increased absenteeism and presenteeism – underperformance due to illness. (World Economic Forum)

Fortunately, company driven health management projects aimed at early detection and prevention can produce savings up to 30%.

A regular health screening such as a health risk appraisal (HRA) will account for a 15% return in a population with an average health status. Any other additional health initiative on top of an HRA will make this ROI grow exponentially. In a population where the health status is lower even more substantial gains can be realised.

A recent study by the World Economic Forum and the Boston Consulting Group analysed the effect of workplace wellness programmes and concluded that they can achieve a 25–30% reduction in medical and absenteeism costs, resulting in increased productivity and lower recruitment and training costs as fewer workers retire or leave for health reasons.

Companies in Europe that target employee behaviour linked to chronic disease risk factors can save an average of up to € 400 annually per employee in healthcare costs and productivity.

In Asia for example the average potential saving is much lower but the proportional impact of a workplace preventative health programme on company performance is equally crucial. Findings show that organisations are seen as:

1. 2,5 times more likely to be a best performer

2. They are 4 times less likely to lose talent within the next year

3. They are 3,5 times more likely to encourage creativity and innovation

4. 8 times more likely to be engaged in the work they do.

More added value

Improving the wellbeing of employees also results in other less tangible benefits:

• Engagement
• Attrition
• Customer satisfaction
• Corporate branding
• Social image
• Employer of choice

“Over the past five years, there has been a growing understanding among employers and healthcare professionals about the relationship between health and work, with recognition of the financial, productivity and social benefits of a healthier workforce”.

(Dame Carol Black, National Director for Health and Work in the United Kingdom.)

Conditions

Numerous case studies and research in recent years have shown that the ROI is not exclusively the responsibility of the provider of workplace health services and programmes. It involves: an integrated approach, investment, executive support, supplier-client co-operation and employee participation.

• It’s essential to know the details about a population’s health before designing a strategy to improve it
• Health has multiple components, so any strategy for improving it should be holistic
• People are different, so it’s important to offer a variety of approaches
• Create a context for behavioural change
• Work with internal  and external partners
• Communication expertise
• Core set of services with additional ones based on site demographics, culture and needs
• Corporate engagement and executive support
• Robust analytics to evaluate costs and to identify health initiatives and activities for maximum return.