US companies are more advanced in delivering wellbeing programmes than their UK equivalents, but what are the key differences between the two approaches? Noel O’Reilly reports.
Approximately half of US employers offer wellness promotion initiatives, according to a 2013 survey by RAND, and larger employers are more likely to have more complex programmes. However, the RAND survey concluded that evidence of costs savings were “not statistically significant”. Other US studies have found stronger evidence of a return on investment.
Nevertheless, the need to contain high healthcare insurance costs is driving US companies to innovate in how they approach corporate wellbeing. Here are seven ways in which the US approach differs from that in the UK.
In the US, wellbeing is driven by healthcare insurance costs, while the UK relies on the tax-funded NHS
Because US firms provide healthcare for employees through insurance, they have a financial incentive to limit healthcare claims, and therefore insurance premiums, by reducing the risk of employee ill health. Cuts to these costs are more direct and tangible than cutting the costs of sickness absence, which is the main financial incentive for UK employers to invest in wellbeing programmes.
In the UK, many companies offer private medical insurance (PMI) to cover the treatment of unforeseen short-term medical conditions. PMI gives employees access to private healthcare treatment with the aim of reducing the risk of healthcare costs and limiting sickness absence.
Some UK organisations provide health cash plans, a cost-effective insurance policy that reimburses the partial or full cost of an employee’s health treatment.
The new UK Fit for Work service also provides tax relief of £500 per employee per year on expenditure on healthcare to support a return to work after sickness absence. This is an incentive for UK employers to pay for healthcare costs in order to cut absence costs.
US companies are more likely to adopt long-term wellbeing strategies
Due to the risks of spiralling healthcare claims, US organisations have developed strategic and long term wellbeing programmes in order to minimise risk. They are scaled up over a period of years and are less likely to be abandoned when organisations are obliged to cut costs, as can be the case in the UK. The RAND survey found that successful US programmes include long-term planning, clear goals, incentives to participate and rigorous evaluation.
US firms offer financial incentives for employees who reduce health risks
In the US, many firms offer financial incentives for specific behaviour, for example smoking cessation, and some use a combination of penalties and rewards. Other financial incentive programmes reward employees for participation in workplace wellbeing programmes with the aim of preventing ill health and higher insurance claims. Employees are incentivised to take fitness classes or sign up at the gym, for example. Employers sometimes require evidence of improvements such as weight loss or lower blood pressure as a condition for giving the reward.
The US Affordable Care Act, referred to as Obamacare, provides employers with grants and technical assistance to encourage wellness programmes. It permits employers to offer financial incentives for achieving health-related goals, such as stopping smoking or losing weight. These must comply with US equality legislation, however.
In the UK, some employers offer incentives such as discounted gym membership, but a Towers Watson survey in 2014 found that only 36% of staff considered that employers had a role in supporting employees to make healthy lifestyle choices. Critics of financial incentives argue that they are not effective or that they are unfair because they penalise the sick or disabled.
Rebecca Haymes, senior consultant, health and group benefits, at Towers Watson told Personnel Today: “Quite simply, if telling people what they needed to do was enough, we would all be healthy. Employers have a role in creating a culture of health in the workplace. Our research suggests that there is potentially a place for incentives; however, employees are not looking for the high-cost rewards prevalent in a US market, which is driven by high healthcare costs.
“Instead, they may be equally driven by an effective and impactful education programme and one that encourages them to buy into health and embark on a lifestyle change without the need for any incentives.”
US organisations are more advanced in using data and metrics to track progress of employee wellbeing programmes
US companies are using data gathered in wellbeing programmes to track progress and evaluate the impact of interventions over time. Data from online portals, screening programmes or health risk assessment questionnaires can be used in aggregated form to identify where interventions can be targeted within the organisation. It can also be used to demonstrate the return on investment of financial investment programmes.
In the UK, larger organisations have made improvements in capturing sickness absence data and developing metrics to identify cost trends related to employee wellbeing. Employers’ corporate responsibility group Business in the Community has run a campaign to persuade FTSE 100 companies to publicly report on their wellbeing costs. Providers of PMI have also deployed vocational rehabilitation specialists to support employers in reducing claims costs in recent years.
The US leads in using technology to drive engagement in wellness programmes
US companies have taken a lead in using internet-based technology to deliver and track personalised wellbeing action plans. Online portals have also been used as part of communication strategy, with the message tailored to different populations.
Health screening and health risk assessment to identify risk are more common in the US
US companies use regular health screening events to identify employees who may be at risk of ill health or disease. However, the RAND survey found that uptake of worksite wellness programs remains limited. Fewer than half of employees (46%) in the firms surveyed underwent clinical screening or completed a health risk assessment (HRA). HRAs are used to identify employees for healthcare interventions. In the US, there have been federal court cases concerning the linking of HRAs to eligibility of employees for PMI. Some UK organisations have begun to use cancer screening in recent years, and some do offer screening at company wellbeing fairs on a voluntary basis.
Vaccination programmes to prevent ill health are more often undertaken in the US
Vaccination programmes have been included in health fairs in the US to help reduce sickness absence and costs. In the UK, the NHS has run campaigns to encourage flu vaccinations for staff, but generally, vaccination programmes are rare in most industries