‘Even after adopting better habits, PepsiCo’s healthcare costs high’
8 Jan 2014 6:25 AM IST
Released on Monday in the journal Health Affairs and based on data for thousands of PepsiCo employees over seven years, the findings ‘cast doubt on the widely held belief’ that workplace wellness programs save employers significantly more than they cost, conclude Soeren Mattke of the RAND Corporation and his co-authors. ‘Blanket claims of ‘wellness saves money’ are not warranted.’
Workplace wellness programs, a $6 billion-a-year industry, are a favorite of the business community because they promise to improve productivity, cut absenteeism and reduce medical costs by averting expensive illnesses.
They aim, for instance, to help employees quit smoking, maintain a healthy weight and have regular screenings for elevated cholesterol, high blood pressure, cancer and other conditions, all of which are supposed to reduce healthcare spending.
Half of US employers with at least 50 workers offered a wellness program in 2012, as did more than 90 percent of those with 50,000-plus workers, according to a 2013 RAND report. PepsiCo’s was introduced in 2003.
The programs are also a pillar of the Affordable Care Act (ACA), President Barack Obama’s healthcare reform law. The ACA allows employers to reward workers who participate in wellness programs, and penalize those who refuse, with discounts or increases of as much as 30 percent of their insurance costs. That can be thousands of dollars per year. Some workers have objected to the programs because of the penalties. Others say workplace wellness efforts invade their privacy and promote poor medicine. Last year, for instance, faculty members at Pennsylvania State University rebelled against a workplace wellness program whose ‘health risk assessment’ asked, among other questions, whether male employees examined their testicles every month and whether women employees intended to become pregnant.
They also protested its requirement that even healthy young adults receive frequent cholesterol and other screenings, which physicians recommend against, and the steep penalties for opting out: $1,200 a year.
Workplace wellness programs, a $6 billion-a-year industry, are a favorite of the business community because they promise to improve productivity, cut absenteeism and reduce medical costs by averting expensive illnesses.
They aim, for instance, to help employees quit smoking, maintain a healthy weight and have regular screenings for elevated cholesterol, high blood pressure, cancer and other conditions, all of which are supposed to reduce healthcare spending.
Half of US employers with at least 50 workers offered a wellness program in 2012, as did more than 90 percent of those with 50,000-plus workers, according to a 2013 RAND report. PepsiCo’s was introduced in 2003.
The programs are also a pillar of the Affordable Care Act (ACA), President Barack Obama’s healthcare reform law. The ACA allows employers to reward workers who participate in wellness programs, and penalize those who refuse, with discounts or increases of as much as 30 percent of their insurance costs. That can be thousands of dollars per year. Some workers have objected to the programs because of the penalties. Others say workplace wellness efforts invade their privacy and promote poor medicine. Last year, for instance, faculty members at Pennsylvania State University rebelled against a workplace wellness program whose ‘health risk assessment’ asked, among other questions, whether male employees examined their testicles every month and whether women employees intended to become pregnant.
They also protested its requirement that even healthy young adults receive frequent cholesterol and other screenings, which physicians recommend against, and the steep penalties for opting out: $1,200 a year.
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