August 29, 2007

THE CASH YOU SAVE MAY BE YOUR OWN:

Get Well Soon: A wellness program can help your company save money on health-care costs (Business Week, 9/03/07)

Skyrocketing health insurance premiums were ruining the bottom line of Coral Chemical, a $20 million, 90-employee company in Zion, Ill. "The only way to control costs was cut benefits or make the employees pay more," says CEO John Schueneman, who couldn't bring himself to do either. "I was in a horrible losing situation for years."

Schueneman eventually found a different fix. First he switched to a high-deductible health plan. Then he adopted his insurer's wellness program, offering free health screenings and group walks to his employees. Schueneman's premiums now are 4% below where they would be without the program. "We've been able to get employees thinking about health, offer really rich benefits, and still save money," he says.

Wellness programs run the gamut from employer-sponsored group fitness activities and healthy cafeteria food to formal activities linked to an insurance plan. Destiny Health, Schueneman's carrier, has offered a wellness program bundled into its high-deductible insurance plan since 2001. UnitedHealth Group is testing a high-deductible plan paired with a wellness program for companies with 100 to 1,000 employees and plans to offer it to smaller companies in 2008.

High-deductible health plans, however, have their critics. These programs pair deductibles of up to $11,000 for a family with lower premiums. Employees can pay their health-care bills out of individual health savings accounts (HSAs), to which they or their employer may contribute money tax-free. But unless a plan is linked to an active wellness program and proper education, an employee may end up with debt rather than savings. And wellness programs need significant incentives and active leadership to be successful.

Done well, though, the combination can sharply lower expenses. Companies sponsoring wellness programs saw a 30% reduction in medical and absenteeism costs within 3.6 years, according to a 2005 survey by industry publication The Art of Health Promotion. And the Wellness Councils of America (WELCOA) found a $24 return for every $1 a small company spent on a comprehensive program.


Strange that congressional Democrats are trying to deny children these wealth building and cost-cutting types of programs.

Posted by Orrin Judd at August 29, 2007 4:31 PM
Comments

I floated a "fat tax" on my radio show the other day.

Make people weigh in to get their pay checks. Start with a low base ($20/pay period), and every one who is in proper weight range pays nothing more.

Add $5/lb for every lb they are overweight.

Your taxation is in your own hands, and as everyone reduces fat to lower their bill, they make the aggregate health of the nation that much better.

It is quite brilliant, which is why it will never be adopted. (reduce pension/Soc. Sec. pay outs by the same amount, BTW)

Posted by: Bruno at August 29, 2007 5:35 PM
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