How do Wellness Programs Reduce Insurance Costs?

Healthcare reform brings a string of new provisions aimed at reducing the overall cost of healthcare, such as employer wellness programs.

Wellness programs have existed in the workplace for years, but in 2008, the Center for Disease Control implemented  guidelines for how the workplace can play a significant role in building a healthier America. They have done so by establishing a corporate culture that includes physical activity and programs for healthy eating practices, breastfeeding support, stress management and physical fitness. A 2010 study showed that for every dollar spent on wellness programs medical costs fell by approximately $3.27 and costs associated with absenteeism fell by approximately $2.73.

According to Harvard Education, more than 60 percent of Americans get their health insurance coverage through an employer-based plan and the majority of their time is spent in the workplace. If companies can take responsibility for offering wellness promotion opportunities, healthier workers might be more productive rather than sharing flu and cold germs with their co-workers.

Many companies assess employee health with quizzes relating to exercise, nutrition, stress, smoking and alcohol, reports the Milwaukee Journal-Sentinel.

Many assessments come with an incentive such as rewarding points to purchase merchandise or cash. Sometimes health premiums can be reduced. After health screenings, the programs can vary from weight loss plans to even smoking cessation programs.

Under President Obama’s healthcare overhaul, businesses will be able to offer their employees health insurance at extremely low costs for maintaining a healthy lifestyle. Employees’ health status will be evaluated in terms of weight, blood pressure and cholesterol levels. While many Americans are concerned with the cost disparity that could result between healthy and unhealthy individuals, others, such as David Hunnicutt, president of the Wellness Council of America, talk about overall healthcare costs.

“At $2.6 trillion annually, U.S. health costs lead the world as a percentage of national economic output,” he told the Journal-Sentinel.

Employer wellness programs may benefit unhealthy workers by improving their health and reducing the risk factors of developing health conditions later in life. This is especially true for employees who have opted out of employer life insurance plans and may be paying higher premiums for individual life insurance plans.

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