Corporate Wellness as a Business Strategy

Corporate Wellness as a Business Strategy By: Jenn Dubey Engage Employees. Improve Productivity. Lower Healthcare Costs. 2014 Evolve Corporate Wellness

Evidence behind the need There is considerable evidence of the dramatic decline in our nation s health over the last 50 years. In a culture where we lose $240 billion in productivity annually and more than 1 in 3 people live with a preventable chronic illness, employers should consider employee health as a priority business strategy. When we look at the increased rate of inflation compared to the increased cost of healthcare, we can see that the path we are on is not sustainable. The increased cost of medical care has more than tripled that of inflation. Inflation has increased by 38% over the last decade whereas health care costs have increased by 172%. These statistics demonstrate that poor health is affecting our economy along with the growth of businesses in one way or another; whether it is through poor productivity or increased costs to employers. A paradigm shift is needed where influential leaders have some level of control to promote healthy lifestyle within their environment. We strongly advocate the position that business leaders should consider corporate wellness initiatives as a business and human capital strategy; and even consider corporate wellness as part of corporate social responsibility. The downward trend of poor health practice not only affects our individual health, it is affecting the health and productivity of our business community. The positive influence of a health driven culture can impact employee health choices, reverse chronic illness, improve productivity, and assist with employee retention. The positive economic impact of improved employee health is valuable to business owners and the customers they serve. What social norms impact our health the most? Let s briefly identify the three main trends or social norms that have negatively impacted our health so we can begin to examine the need for a more creative intervention. The first trend is the need to constantly be connected which creates tremendous stress on our central nervous system. Although being global and having efficient communication systems seems to be beneficial in the business world, there is now ample evidence that technology, in combination with our busy lives, over stimulates our brain adding physiological stress to our body. Chronic stress can impact our health on every level including mental, emotional, and physical. A second trend is the increased consumption of processed food, which was originally intended to simplify our lives. Processed food, an idea birthed with good intentions, has now become a social norm that has created sickness amongst our population. Eating a diet lacking in nutritional value including vitamins, minerals, fiber and antioxidants has increased the prevalence of nearly every chronic illness. The final trend to consider is our lack of physical activity. The average person is sedentary nearly 9 hours a day. If you look at our skilled labor workforce and manufacturing industries, we have created an environment of efficiency thanks to technology; that also means we are a more sedentary population of people. Unfortunately, many people conform to these trends or social norms without considering the personal implications or long term consequences. 1

What is the impact of social norms on our health? In society today almost every American realizes smoking causes cancer. In 1960 more than 50% of all men and 30% of all women engaged in what we now know is a deadly habit. (2) At that time, the link between cancer and smoking was not identified. It was, in fact, a social norm that was deemed not only socially acceptable but also healthy. Men in the armed forces were provided free tobacco while serving our country because of the suggested health benefits. It was seen as a way to help keep off extra weight and also served as a reducer of stress. Today only 18% of the American population smokes due in large part to shifting social norms brought about by heavy taxes and strict laws against smoking in public and at work. As a community we took a stand against this unhealthy habit encouraging a bit of conformity for the greater good of society. The same concept can be applied to other health behaviors simply by increasing awareness and making subtle yet powerful shifts in the way we do business. To follow in the path of smoking and provide a modern day example of a health behavior that is socially acceptable but negatively impacts our health, let s discuss something most of us see as an insignificant issue- the consumption of sugar. Over the last 50 years the average American s sugar consumption has jumped from 108 pounds per year to 150 pounds per year; which equates to an annual per person increase of 0.8 pounds. (7) You may think that this is not a comparable example to smoking because after all, smoking is addictive. People fail to realize sugar is highly addictive as well. Research by the National Institute of Health has shown that sugary products can induce Source: USDA cravings in humans that are comparable in magnitude to those induced by addictive drugs such as cocaine. This research has revealed that sugar cannot only be a substitute to addictive drugs but that the physiological reward appears to be even more robust than that of cocaine. According to the American Heart Association studies show consistent adverse effects of sugar consumption on HDL and triglyceride levels, which could accelerate atherosclerosis (hardening of the arteries.) High sugar consumption may also limit a persons ability to control diabetes. (4) Over the past two decades we have watched America pack on the pounds. The national obesity rate is close to 35% with more than 68% of the population carrying extra weight. While that 68% of the population is not classified as obese, it highlights that being overweight is the new normal. Not only are these increases in weight gain and obesity a health concern, but they are also an economic concern. In 2008 the estimated annual cost of obesity in the U.S. was $147 billion; the medical cost per capita was $1,429 higher than people of an ideal weight. According to the Center for Disease Control (CDC), obese employees have a higher absenteeism rate averaging 3-4 additional days per year. (3) Sadly the rate of childhood obesity has risen dramatically as well, increasing by 50% in the last 30 years. Currently, more than 33% of children in the U.S. are suffering from weight related issues. According to research, obese youth are more likely to have risk factors for cardiovascular disease, such as high cholesterol or high blood pressure. In a popula-tion-based sample of 5-17 year olds, 70% of obese youth already had one risk factor for heart disease. (1) 2

Obesity at a Glance Percentage of U.S. Children Who Are Obese 25 20 15 10 5 1974 1980 1994 1999 2002 2006 2008 6-11 Years old 12-19 Years old Obesity and sugar consumption are not the only areas of concern. Chronic illnesses such as heart disease, cancer, and diabetes have increased in mass proportion. Diabetes is one of the largest threats in terms of health and economics, the outcome is potentially catastrophic. The American Diabetes Association is predicting a 64% increase of newly diagnosed cases of diabetes over the next decade. Sedentary lifestyles, diets high in processed foods, high stress environments, and poor sleep patterns can all contribute to the alarming prediction of increased cases of diabetes. Even though this has the potential to be catastrophic, we can clearly avert this outcome because 80% of all cases are preventable. As our health has deteriorated and we have increased our rate of obesity, diabetes, heart disease, and cancer; it has clearly had a negative economic impact on the bottom line. In 2004 U.S. healthcare costs averaged $6,280 per individual. Consulting firm Aon Hewitt reported in 2013 that number had inflated to $11,188. (8) Compared with the annu-al 2.4% average rate of inflation, annual healthcare costs have inflated an average of 7.2%. Healthcare costs have become the second highest expense for most companies, sitting right behind payroll. The CDC maintains that 75% of the chronic illnesses responsible for the healthcare cost increase are preventable with lifestyle modification. The National Center for Disease Prevention and Health Promotion agrees that our common health-damaging behaviors such as tobacco use insufficient physical activity, poor eating habits, and high stress environments are responsible for much of the associated disability. The economic impact of diabetes alone could reach $245 billion next year. If we can change the outcome of diabetes alone, we will align with our social responsibility and make an amazing economic impact. 3

Why isn t personal responsibility enough? We can recognize that for society to function effectively there is usually some degree of conformity, such as following traffic laws. Solomon Asch and Muzafer Sherif are two top researchers shedding light on social conformity. According to Asch, people conform for two reasons. The first is called informational conformity where in an unfamiliar situation we are likely to shape our behavior to match that of those around us because those actions are viewed as accepted practice. A second type of conformity is called normative conformity. Though we may disagree secretly with the group opinion, we may adopt the group stance so that we seem like a team player rather than a deviant. Both of these avenues of conformity impact us every day. What happens when social conformity does not work for the greater good of our society? What if conformity to the popular trends disrupts the overall health of our society? It is common practice for employees to conform to certain standards of their employer. Companies have their own unique culture that can be shaped or molded by leadership. Every corporate culture consists of a group of people acting in accordance to social norms specific to the environment established by management s leadership. This may include best practices, code of conduct, and even common core values. Most businesses have a mission, vision, and direction that are valued by the company leadership as well as the employees. It is expected that if an employee wants to be successful, the employee should adhere to certain expectations. Integrating worksite wellness into a work environment that promotes conformity benefits both the employer and employee. Just as we follow dress codes and other codes of conduct, we can create a corporate culture that conforms to good health practice. Should we consider employee health a corporate responsibility? Healthcare reform in the U.S., including the Affordable Care Act, has sparked discussion about the role employers should play to maintain employee health. As many companies struggle with lost productivity due to illness, they are beginning to see a need for a shift in strategy. Research by the Milken Institute concluded in 2012 that common and often preventable chronic illness such as diabetes and heart disease were responsible for $1.1 trillion in lost productivity. Those losses are due to both absenteeism and presenteeism. Presenteeism by definition is the practice of coming to work despite illness, often to the point where productivy is affected. Keeping people healthy requires a systematic approach, which is part of our existing work culture, along with an abundance of resources to drive employees to make health conscious choices based on their work environment. As an organization committed to improving the state of our nation s health, we were inspired by the former director of the CDC, Dr. Julie Gerberding s, philosophy to focus on health creation, which goes beyond the idea of using pamphlets and literature to educate employees. These health driven ecosystems would include the support of all leaders of a community whether it is through politics, healthcare, or business. In the past, the model of corporate social responsibility was separate from health practice. It was (and is still) seen as more of a philanthropic principle that some businesses adopt in order to support the community. As we identify how the health of employees impacts our business growth and sustainability, we should be asking the question: Should companies have a social responsibility to protect the health of their human capital? After hearing the evidence it is hard not to agree that it is appropriate for companies to entertain corporate wellness as a social responsibility for the benefit of our community and the sustainability of our businesses. 4

What does it take to create a well culture? Although many companies are already integrating some level of health promotion, not every company is fully embracing the potential they have to strenghen their workforce through wellness. In 2011, nearly 90% of companies with 200 employees or more had implemented some aspect of wellness into their culture. What does it take to actually shift culture to one that supports and promotes health? 1. Embrace an organizational vision of health This requires a review of company policy and culture to identify areas within the organization that negate healthy living practice. An example would be promoting a high stress/demanding environment where the expectation would be that employees do not leave their seat for hours on end. Do employees fear integrating good health practice including proper nutrition and movement because it goes against the company expectations? This can be a fast kill for any wellness program. 2. Senior leadership support of healthy living as a cultural expectation Support from senior leaders validates a wellness program. A huge aspect of leadership support is strong communication coming from the top. Without communication, employees will not see the program as a company priority. If employees do not receive validation from leadership, engagement in the program will not occur. 3. Implement policies that promote health practice Just as you have a dress code or other code of conduct policies, it is important to consider how to implement the expectation of being a well employee. If it is something the company truly values then it should be expressed through corporate expectations. The most extreme example of this is Weyco, Inc. The company s CEO, Howard Weyers, decided in 2005 he needed the company to be smoke free as a way to control health care costs. Before the smoking policy was implemented in 2005, Weyco Inc. took proactive steps and quit hiring tobacco users in early 2003. 4. Outline Health Goals and Program Elements Every company demographic will have its own unique challenges or barriers. Understanding your company s barriers by collecting aggregate data is the first and most critical step in building a strong culture of health. As with business strategy, being able to identify the areas of need to create that well culture is a fundamental practice. Having steps in place to achieve certain standards and expectations is the only way to eliminate the barriers. What if these pieces do not exist within my company? Currently, in the US, nearly 40% of programs fail to meet the above listed criterion, creating challenges for both the employer and the health professional managing the program. Aon Hewitt s 2011 report identified that 78% of U.S. employers are actively promoting the importance of employees taking responsibility for their health by offering tools such as health risk assessments to raise participant s awareness of their health status and health risk factors. Although a health risk sssessment offers beneficial aggregate data and the wellness challenge may motivate your employees, in a stand alone program they do not promote a culture of health. When the cultural expectations begin to align with good health practice employees will gradually embrace the new culture; especially if it aligns with the company s vison and mission. 5

What is the potential outcome of a successful program? When a company is willing to accept wellness as a business strategy and focus on building a culture of health, cost savings can be achieved. In a peer review study done in 2010, cost savings were measured using 32 original case studies characterized by their qualitative dimensions. The emphasis of these programs included lifestyle factors such as weight loss, fitness, and smoking cessation. The studies that reported program costs found that those interventions produced $358 per employee per year in savings through reduced health costs, while costing the employer $144 per employee per year. The average calculated return on investment was $3.37 for every dollar spent. (6) When a company makes a conscious decision to invest in the health and vitality of its employees the needle on cost begins to shift. This is only effective, however, if the elements of a well culture are properly in place. The Gen-X and Millennial generations are less interested in company loyalty and more interested in work-life balance and flexibility. They are not always driven by money but are looking for the extra value an employer brings. Research shows forty-five percent of Americans working at small to medium-sized companies say that they would stay at their jobs longer because of employer-sponsored wellness programs. (5) Final Conclusions Across the country, health and wellness initiatives are still largely the domain of human resources. While it is true the department of human resource is in large part responsible for human capital, veiwing wellness primarily as a HR program does not position it as an effective business strategy. Wellness is currently viewed as a non-essential program that struggles to gain momentum. It will not have a strong impact on the overall economics of the business, primarily because it is not seen as an intelligent business strategy. Health needs to be integrated into the operational aspect of the organization and built into the business model to have an impact. If we can effectively create a paradigm shift to a culture that promotes and supports health, we can eliminate the billions of dollars spent on sickness care, loss of productivity, and employee disengagement. Allowing wellness to infiltrate our business strategy can indeed be part of an economic strategy, at the same time promoting health within our larger community. About the Author Jenn Dubey is the president and founder of Evolve Corporate Wellness, a consulting and wellness management firm. She is passionate about helping companies implement health strategies that will improve the vitality of the workplace with solutions for individuals. Jenn has spoken at several national conferences, spreading her message to a variety of leaders concerned with health and wellness issues. With nearly 15 years in the health and wellness industry, Jenn believes changing the health culture of the workplace is key to creating a sustainable economic future for businesses across the country. 6

Resources Used: http://www.cdc.gov/healthyyouth/obesity/facts.htm (1) http://www.cdc.gov/tobacco/data_statistics/fact_sheets/adult_data/cig_smoking/ (2) http://www.cdc.gov/workplacehealthpromotion/businesscase/benefits/productivity.html (3) http://circ.aha.journals.org/content/106/4/523.full (4) http://www.shrm.org/hrdisciplines/benefits/articles/pages/wellness_employeeretention.aspx (5) http://www.sibson.com/publications/perspectives/volume_21_issue_2/roi-wellness.html (6) http://www.usda.gov/factbook/chapter2.pdf (7) http://www.aon.com/forms/2013/form-us_2013_sur_healthcaresurvey.html (8) http://www.aon.com/attachments/human-capital-consulting/2012_health_care_survey_final.pdf http://www.ahrq.gov/research/findings/factsheets/costs/ http://www.ihpm.org/pdf/employerhealthassetmanagementroadmap.pdf http://content.healthaffairs.org/content/29/2/304.full.html 7