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Wellness Programs Help the Bottom Line

By Michael D. Sessions, PhD

The Challenge
Health care costs are rising at an unsustainable rate. One study found health premiums increased 50 percent between 2003 to 20101. Three percent of the workforce is absent on any given day for reasons other than vacation or labor dispute2. Presenteeism, a term describing employees who show up for work ill and not functioning at full productivity, cost employers two to three times more than the cost of health care3. These challenges seem daunting, but they are not insurmountable. Construction companies, in ever-increasing numbers, are making wellness a strategic initiative – and their programs are bucking cost trends.

Wellness as a strategy has been part of Austin Industries’ initiatives for eight years. Austin is an AGC member in Arizona, Louisiana, and the Carolinas, in addition to Texas’ Highway, Heavy, Utilities & Industrial Branch. Enrique Estrada, who heads Austin Industries’ wellness program, describes a modest beginning to its program. “We started our program by asking employee-owners to complete a health risk assessment (HRA).” The program quickly evolved and provided incentives and premium reduction to employees for participating in various wellness activities such as an annual physical, wellness webinars, and completing an HRA. The program recently moved from incentives for participation to incentives for outcomes and it provides wellness coaching to support employee efforts to either reduce risk factors or maintain positive health.

PC Construction, an AGC of America member in Maine, Vermont and the Carolinas, implemented a wellness program six years ago. Nancy Shambaugh, director of HR, reports that the program increased health benefits while at the same time contributed to holding costs to an annual average increase of 1 percent per employee per year for the past five years. When PC Construction began investigating how to tackle the challenge of rising health care costs, it became apparent that the prevailing wisdom of procuring a new carrier was not going to provide a solution to rising costs. It was not going to provide a solution because insurance was not driving the cost trend.

Best Practices
There are state and federal regulations that apply to wellness programs. Organizations should seek professional assistance in establishing a program. While there are regulations, there also are a number of best practices to consider as a firm develops a wellness program. These best practices are included in the following list.

1. Senior leadership commitment.
2. Increase a person’s awareness of his or her individual health risks.
3. Provide individual support for cognitive and behavioral change. The program is outcomes-based and the outcome almost always requires a person to change.
4. Focus on participation. Meaningful incentives can improve participation.
5. Create an ethos of health throughout the organization. Wellness should be a value, just as is safety.
6. Monitor results and adjust.

A Closer Look
The year prior to starting PC Construction’s program, 45 percent of employees had not accessed the health care system over a two-year period – no check-up, no doctor visit, no prescription – nothing. This may sound like a good way to save on costs, but 80 percent of PC’s health care costs during that same two-year period were attributable to 20 employees out of 1,000. Furthermore, they determined that half of those 20 employees’ medical conditions were preventable.

PC Construction’s challenge, in order to curb cost, was not to change the behaviors of everyone, but rather to reach 10 people – 1 percent. To reach those 10 people, the mindset had to change from being a provider of sick-care coverage that was used after someone became ill, to being a provider of resources that create awareness, increase personal responsibility, and deliver sick and well-care support.

Both PC Construction and Austin Industries contract with outside resources to provide health screenings, health coaching, and other similar wellness-related services. The screening includes metrics such as blood pressure, weight, body mass, triglycerides, glucose, and a detailed health history risk assessment. Employees receive the results immediately following the screening along with a short explanation.

Employees who are found to be at medium- to high-risk, with three to five risk factors considered medium risk, are invited to voluntarily engage with a health coach. Meeting with the health coach provides a more detailed review of the health screening and HRA results while creating a conduit for ongoing support. The goal of ongoing support is for individuals to accept responsibility for their health, set goals to reduce risk factors, provide resources to accomplish the goals, and help the employee monitor progress.

Both Estrada and Shambaugh found that obtaining field supervisory buy-in is important for program success. The program adds a level of complexity to the health benefit, so extra time and energy is needed to train the field and help supervisors understand the challenge and the potential benefit to individuals and the company. Additionally, field supervisors should be consulted on how to implement the program to minimize disruptions.

In 2011, PC Construction reported that 94 percent of employees participated in the health screening and follow-up visit. Ninety-two percent of high- and medium-risk employees were voluntarily engaged with a health coach on an ongoing basis. Employee satisfaction with the program, as measured by independent survey, is very high. Shambaugh says, “Employees, particularly field employees, comment that this is the best benefit program they have experienced.”

When it is recognized that people are the differentiator, it becomes clear that investing in the health and wellness of people rises to the level of strategic importance. Providing a robust wellness benefit requires the executive team to take the long-view and must be supported by field personnel. While not inexpensive, the 1 percent cost increase for PC Construction’s overall health and wellness program bucks the trend. The solution to the health care crisis begins with the health and wellness of people – something construction companies are tackling one individual at a time.

1. Schoen, C., Frayer, A., Collins, S. & Radley D., “Realizing Health Reform’s Potential,” The Commonwealth Fund, November 2011, pub. 1561, V. 26.
2. Bureau of Labor Statistics, March 1, 2012, http://www.bls.gov/cps/cpsaat46.htm.
3. Hemp P. “Presenteeism: At Work — But Out of It,” Harvard Business Review, October 2004, 49-58, 155.