Investing in employee health pays off: Wellness benefits a growing part of compensation packages

Like a lot of companies, the accounting firm BerryDunn for years offered its employees free routine health screenings to assess their risk for chronic diseases like diabetes, high blood pressure and cardiovascular disease.

Though the screenings were free and offered on-site, four years ago just 27% of employees completed them.

Then it switched to a high-deductible plan linked to a health-savings account, offering each of its 280 employees a significant incentive to complete the screenings. Participation shot up to 63% and 176 people were screened.

BerryDunn, which is based in Portland, is one of a growing number of companies that are investing more heavily in wellness and seeing these investments pay off — not only in the form of lowering the firm's cost of providing health insurance, but also by boosting recruiting power and worker morale.

“If we can keep employees healthy and out of the doctor's office, it's going to affect our bottom line,” says Debra Genender, director of human resources for BerryDunn. “And the feedback we get from employees, is that they really feel like the firm cares about them. And when employees feel like they're supported by their employer, and their employer is helping them be healthy, that has a lot of added value.”

Nearly three quarters of all companies now offer at least some sort of wellness benefit, such as health risk assessments, health coaching, web-based tools for healthy living, discounts on gym memberships or on-site fitness centers, according to Kaiser Foundation's 2014 Employer Health Benefit Survey.

Many firms are paying employees in some way to take advantage of those benefits — with incentives like smaller premiums, smaller deductibles, greater contributions to health savings accounts or cash. According to the Kaiser survey, 36% of firms with 200 employees or more offer these incentives.

“More forward-thinking companies are saying 'This is something we need to do,'” says Mark Holmes, owner of Health Coaches Inc., a Portland provider of on-site coaching, health screening, fitness and wellness center design. “They're asking, 'How can we prioritize it and fit it into ever-tightening budgets?'”

Employers are finding that the most important thing is to tailor their wellness benefits to meet the unique needs of their workforce, and the work that they do. Incentives aren't for everyone; often the highest return can be in investing those wellness dollars elsewhere.

At Baker Newman Noyes, a Portland-based accounting firm with 250 employees in six offices, the number of employees who complete their annual physicals and preventive health screenings is 87.5% higher than other financial services firms in New England, says Jennifer Harnish, director of human resources with the firm.

“It's the culture here,” says Harnish. “People are invested in their health and feeling good and we do a great deal to promote and encourage our employees to get involved.”

In addition to hosting health fairs and health screenings on-site, all year round, the firm has targeted its investments in wellness to benefit employees when they're likely to be logging the most hours at work, and most likely need the health boost the most — between January and April.

The firm brings in chair massages and fresh fruit, stocks the vending machines with healthy options and drops the prices of all the snacks and drinks to 25 cents.

The firm has a culture of people who like to race in events like the TD Beach to Beacon 10K Road Race, and participate in firm outings like overnight hiking trips to Flagstaff Lake and community recreation teams like floor hockey. While premium expenses in the market for firms like theirs have gone up by as much as 15%, at Baker Newman Noyes increases are in the single digits.

“We have not seen the huge spikes in health-care costs that we've had to pass on to our employees,” says Harnish. “So that's a good indicator.”

Companies assessing risk

The screenings are particularly useful, companies say, because they help employees understand any health risks they may have. And they allow management to tailor wellness programs to meet the specific needs of the workforce. It should be noted that individual test results are confidential; management gets an aggregate report.

The tests measure factors like blood pressure, triglycerides, blood sugar, cholesterol and body mass index. In turn, they help show how much an individual is at risk for chronic health conditions like cardiovascular disease, metabolic syndrome and diabetes.

Younger employees, in particular, sometimes neglect routine physicals and screenings. During the health screenings, there's also an opportunity to discuss lifestyle changes employees can make to improve their health.

“Some of the barriers are broken down,” says Holmes. “You can have simple conversations about what they're bringing for lunch and how they can increase the amount of exercise they're getting.”

At BerryDunn, employees who in their health screenings find that they are in the high-risk category for at least four of the six chronic disease measures are offered six health-coaching sessions, which the firm pays for.

Many firms find that the incentives help ease employees' transition to high-deductible health plans with health savings accounts, which have become more popular. Now 20% of workers who get health insurance coverage through their employers are enrolled in high-deductible plans, according to Kaiser. That's up from 8% in 2009.

“The incentive really played a huge part in how many people switched” to the high-deductible plan, says Genender. “We really saw it immediately. And now when I sit down to explain the benefit package to new hires, the incentive just cinches it for them.”

The health screenings are just one leg of BerryDunn's program. The firm reimburses employees up to $100 per year for fitness expenditures like gym membership and golf and ski passes. It also organizes fitness challenges for employees, with cash rewards for those who lose the most amount of body fat or take the most steps over a three-month period.

As the firm has ramped up its investment in wellness, it has seen a noticeable drop in prescription medications and other expenses.

“The overall sentiment is that [the wellness initiatives] are helping with costs,” says Genender. “The incentives helped tremendously.”

Others see a benefit

Other major employers are also seeing their investments in employee health pay off.

Maine Veterans' Homes, which has 1,100 employees at seven sites throughout the state, began its wellness program about five years ago, and in 2012 started offering employees company-wide incentives for participation in specific wellness activities.

Employees can earn $50 for getting their annual physical, $25 for an annual health screening or $25 for completing three phone sessions with a health coach. Plus, employees can earn up to $75 per year for participating in wellness activities at the company — like attending lunch-and-learn seminars — and in the community, like running a 5-K or participating in Relay for Life.

And it's worked.

Since 2012, the number of employees getting well visits jumped by 18%; the number of emergency room visits dropped by 21%. In the first six months of the year, there was a 33% drop in the in the number of reported injuries and illnesses compared to the same period of last year.

In 2016, for the first time, Maine Veterans' Homes will ask employees to share the cost of health care coverage. Though employees will be asked to pay for 5% of their health-care premiums — which will represent approximately $400 for a full-time employee — they will be able to earn the entire amount back by getting an annual physical and participating in the organization's on-site annual health screening. Plus, employees can earn additional incentives for working with a health coach and participating in healthy activities both at work and in the community.

“We want to reward people for taking care of themselves,” says Joanna Aronica, wellness manager for Maine Veterans' Homes, which offers long-term care for veterans, their spouses and Gold Star Mothers.

“Equally as important is the soft return,” she adds, “employee morale, recruitment and retention and sustaining a healthy culture where employees take pride in the work they do each and every day. We know that healthy, happy and safe employees take the best care of our veterans and so at the end of the day it's a win-win.”

Making wellness investments

For other companies, wellness investments are taking a different form. Allagash Brewing Co. in Portland is breaking ground this fall on a 2,400-square-foot fitness center on site for its employees, who number 95 and counting. The center will include cardiovascular machines, weights and space for fitness classes. It will be open 24 hours a day to accommodate workers on all shifts.

“Because many of the roles at Allagash are physical and vigorous, it's super important to maintain a high level of fitness,” says Celine Frueh, director of human resources for Allagash. “We really want people to have no barrier to stay well. It's good for employees, and it's also good for us. The healthier our team, the fewer lost days to sickness, and higher levels of fitness lead to fewer workers' comp claims.”

In addition to the fitness center, Allagash has deployed a wide-ranging array of benefits to keep its workers healthy. Experts from OA Center for Orthopedics come on-site to give employees specific stretches and exercises to ease any stresses and strains that go along with their work duties.

Allagash also provides fresh fruit each week between December and March. Starting this spring, Bumbleroot Organic Farm in Buxton is delivering a share of fresh vegetables each week to the company.

The brewery organizes group fitness activities like “Yoga Fridays,” winter ski racing and a year-round bowling team. Many of its employees are runners, and it sponsors several teams in local races throughout the year. If employees want to participate in any of the races or fitness events in the community that Allagash sponsors, the company pays for registration and post-race celebratory meals.

“The way people stay fit is really different, and we want to be able to meet people wherever they are and with whatever they're into,” Frueh says. “Trying to accomplish your goal through something that's already of interest to employees is better than just cooking up some plan in HR and trying to get others to go along with your idea of what wellness is.”

One key to getting people to use these benefits has been making the benefits easy to use. A $100 benefit is available to each employee annually to spend on whatever helps them stay fit — whether it's a pass to a yoga studio or a pair of running shoes.

“People know that if they buy hiking boots and submit their receipt, in the next paycheck, it's reimbursed,” says Frueh.

The company sponsors a health fair on-site each fall, where employees can get health screenings and flu shots. It encourages people to attend and get tested by having raffles and drawings for gift certificates for fitness activities, like Shawnee Peak or Greener Postures yoga studio.

“If we're spending $300 to bring a nurse on-site, and getting half the workforce vaccinated against the flu, and 60% of them are getting their blood pressure checked to make sure there aren't any underlying health risks, that's a good investment,” she says.

Allagash has seen a decrease in the number of worker's comp claims since 2013, says Frueh. And the company's cost of providing health insurance — the company covers 100% of its employees' premiums — has also declined. That savings has allowed the company to offer more benefits. In 2015, Allagash implemented a 401(k) with a 4% company match to employee contributions.

“It all gets reinvested with the employees,” Frueh says.