“Wellness matters for our people, but what’s the financial return?”
This is often, one of the first questions HR Managers are asked when looking to implement or enhance their employee wellness program. With any significant outlay of resources, it is important to consider the return you can expect. Investing in wellness is no different! While wellness can certainly translate into financial savings, especially in the long term, we also encourage you to look beyond this narrow way of measuring return. Return on investment (ROI) describes the financial return on any given financial investment. In a wellness context, this would typically be healthcare cost reduction. Conversely, value on investment (VOI) describes the overall value received on any given investment, going beyond concrete dollar amounts to include employee health, morale, productivity, job satisfaction, and absenteeism. While these can be difficult to measure, there is no disputing their immense value. Overlooking these factors, many of which may improve faster than direct cost savings, is to undervalue your wellness program and its impact on your employees, workplace, and overall company culture. Though ROI remains a prevalent traditional means of evaluating wellness, the use of VOI is expanding. 91% of employers now report offering wellness programs for reasons beyond medical cost savings. The top reasons employers choose wellness are to improve productivity (VOI), reduce employee health risks (ROI), and reduce healthcare costs (ROI). Organizations that offer wellness programs with intentions beyond ROI tend to place more importance on improving employee productivity, morale, and culture. Despite its growing prevalence, measuring VOI can be difficult because it is inherently more subjective. ROI is normally expressed as a numeric ratio. For example, with ROI if a wellness program has an ROI of 3.1 that means it saves $3.00 for every dollar invested. Instead, the VOI of a wellness program will typically be expressed by stating increases in individual factors of value. For example, “reported employee morale is 60% higher than baseline since the wellness program began.” Below are some examples of VOI metrics and how you might measure them.
Metrics that Demonstrate VOI
Wellness program engagement/participation: This may include health assessment completion, health coaching programs, web-based programs, online/on-site challenges, daily activities in the workplace. Be sure to measure how many of your overall population engage and how deeply rather than a simple list of programs and number of participants.
Health care cost: (traditional ROI can be a factor of VOI.) Remember, it can take 2-5 years for a wellness program to make a significant impact on health care cost trends. A positive impact may be seen by your organization’s health care costs increasing at a lower rate than others in your industry, for example.
Days absent: Monitoring for any declines in absences is a good way to demonstrate VOI.
Job/wellness program satisfaction: this is typically measured via satisfaction surveys distributed to employees. Questions could relate to overall satisfaction with services/programs, program effectiveness, scope of offerings, convenience of program components, communications, member experience, sense of purpose, and perceived value.
Health risks: documenting changes in population health risks is a great way to evaluate your program. You can measure this by (securely & privately) collecting biometric information such as blood pressure, BMI, and cholesterol, and by assessing things like chronic conditions, mental/emotional health, health behaviors – all of which can be collected through biometric screenings and personal health risk assessments.
Safety: depending on the workplace environment, monitoring trends in worksite injuries can be a good indicator of value in your wellness program.
Productivity: this can be measured with validated self-reporting tools. Productivity is severely under-tracked, with only 34% of employers tracking it regularly. If you want to start simple, you can use days absent as a proxy for measuring productivity changes. Reaping value from your wellness investment does not happen without effort and thoughtful strategy. The more comprehensive & intentional your wellness program is, the more likely you are to see strong indications of VOI. Here are some steps you can take to help maximize VOI for your program:
Best Ways to Promote VOI
Multilevel Leadership: buy-in from multilevel leadership is essential for program success. Wellness cannot be solely dictated from the top, nor can it thrive without support from upper management. The best results are achieved when employees from all levels are involved and represented.
Organizational Alignment: is your organization’s culture and infrastructure conducive to wellness? For example, does the cafeteria offer healthy options? Are the stairs accessible and safe to use? Do employees feel comfortable taking time for their personal health during the workday? Examining the assets and challenges already present in the work environment can help you strategize for success.
Depth & Scope of Programs: to ensure your program is reaching and resonating with your employees, it is important to cover wellness topics that are relevant to your employees and that are at an appropriate challenge level. Determine the best curriculum for your employees by administering needs and interest surveys.
Accessibility: whether your employees are dispersed geographically or are separated into drastically varied roles, your employee population may have very different needs and preferences for how they access and interact with the wellness program. It is essential that your wellness program be accessible to all, regardless of where or how they work within your organization.
Partnerships & Resources: Many insurers or other benefits partners will offer some wellness benefits either in the form of funding or services. Make sure your wellness program is working synergistically with these additional resources rather than working against them or confusing employees with duplicated services.
Communications: just as important as the content of your wellness program is how you choose to communicate it! Clarity, sensitivity, and appealing design are all important factors to motivating your employees with your communications. Measuring the impact of a wellness program is more than ROI alone. A comprehensive evaluation strategy that encompasses both monetary and non-monetary value will paint a clearer picture of how your wellness program is affecting your employees, your company culture, and the bottom line. Remember, it can take years for actual health care cost savings to be realized, so demonstrating value and successful outcomes in other areas can help keep stakeholders on board, maintain wellness funding levels, and keep the program invigorated as team members feel accomplished and inspired by the difference they are making. At Wellness Workdays, we develop custom strategic evaluation plans to determine success and guide growth. Contact us to learn more about how your organization can take a comprehensive approach to develop an employee wellness program. #wellness #roi #voi #hr #costsavings #financial Source: Optum.com https://www.optum.com/content/dam/optum/resources/whitePapers/Beyond_ROI_health-wellness-investment.pdf