In an effort to control rising health care costs, many employers in the U.S. have instituted wellness programs with the hope that employees would practice healthier habits in exchange for rewards, which usually come in the form of discounts on health insurance. But according to a recent study conducted by RAND Corporation and PepsiCo, although the 10-year-old PepsiCo Health Living wellness program has been successful in certain aspects, it failed to significantly reduce health care costs over the past seven years.
Pepsi’s wellness program provided employees with health risk assessments, on-site wellness programs and screenings, a complex care manager, and regular telephone follow-ups with nurses. These services are split into two separate forms of management: disease management and lifestyle management. Disease management provided services to employees who had one of 10 chronic illnesses, including diabetes, asthma, and hypertension. Through regular follow-ups with nurses, these employees were able to control their conditions, which led to health care savings of $136 per member per month and a 29 percent reduction in hospital admissions, Reuters reported.
On the other hand, however, lifestyle management only led to a slight decrease in absenteeism, with no significant effects on health care costs. This component of the wellness program included services to help manage weight and nutrition, fitness, stress, and even had a program for smoking cessation. However, the study only looked at costs of care based on the assumption that a person who gets sick will go to a doctor. It didn’t explicitly at employees’ health, according to Reuters.
“Workplace wellness programs have the potential to reduce health risks and to delay or avoid the onset of chronic diseases as well as to reduce health care cost in employees with manifest chronic disease,” wrote the researchers, which included those from RAND as well as two PepsiCo executives, according to Forbes. “But employers and policy makers should not take for granted that the lifestyle management component of such programs can reduce health care costs or even lead to net savings.”
About half of U.S. employers with 50 workers or more, and 90 percent with 50,000 or more, have adopted wellness programs, Reuters reported. These numbers will continue to grow too, as employers take advantage of provisions in the Affordable Care Act that give employers health care discounts of 20 to 30 percent — even 50 percent in some cases. For employers looking to adopt these programs, the researchers advised that they should “proceed with caution.”
Source: Caloyera J, Mattke S, Broderick M, et al. Managing Manifest Diseases, But Not Health Risks, Saved PepsiCo Money Over Seven Years. Health Affairs. 2013.