Some employers have sticker shock when they see the cost of workplace wellness. Understandable, it’s costly, but let’s look at the bigger picture: Studies show for every dollar spent on wellness programs, medical costs fall an average of $3.27, and costs for days that employees are absent fall $2.73. 

It’s easier to understand when you crunch the numbers: Workplace wellness programs are not costing you, but they are actually saving you money. I’ve stressed the importance of obesity prevention, and employers are in a powerful position—they have a say in the health of their employees. I believe that incentives, especially when coupled with leadership from the top, allow employees to understand their employers’ priorities. 

In 2014, the Affordable Care Act will expand employers’ ability to reward or penalize workers who participate in and meet the goals of various wellness programs. When there is change, particularly in healthcare, there are questions. How will this impact employee plans? 

Many expert consultants advocate incentives early on as a way to encourage employees to make proper wellness choices that can have a positive impact on their longer term health and well-being and result in lower future healthcare-related costs. In the future, employees might be choosing health plans from a menu of options and have to pay for the difference of the cost of the plan and a subsidy provided by their employer. If this is the way things unfold, it would be in the best interest of employees to focus on wellness so they can choose cost-efficient health plans in the future. 

Of course, in line with most things in life, providing incentives and penalties have pros and cons. What works well for one employer may not work well for another. Here, I will acknowledge both sides, and let you decide which program will resonate best with your company.  

THE PROS

Incentives can make people happy. By covering the cost of a wellness program, or even just covering a portion of the cost, employers have the ability to take the cost burden of the most efficient programs off of employees’ shoulders. Investing in clinically-proven wellness programs fosters healthier, more productive, and happier employees.   

Financial rewards may generate weight loss results. Studies indicate programs that use financial rewards have positive results and may be effective in producing weight loss. Valued incentives lead to more participation. This could include gift cards, bonuses, or awards of different amounts based on various levels of success. 

Penalties, such as higher health insurance premiums if an employee does not meet the company’s goals, may motivate employees to stick with it. On the contrary, you can also penalize employees who do not meet the company’s wellness standards. In the perfect world, everyone would be healthy simply because they know it’s good for them. But that’s not always the case. Employees are aware that health insurance is costly, and for some, taking money out of their pocket is just the push they need to achieve weight loss. 

Contests and competitions can boost morale and encourage participation. Friendly competition can go a long way. If you work in a competitive environment, it may be beneficial to make wellness a competition. Plus, it puts everyone in the same boat, so it can make sticking to a weight loss plan fun, encouraging, and supportive. 

A wellness program that demands results equals a healthy and wealthy company. Making wellness a priority by providing incentives can attract the best employees to your company. It shows you care about the well-being of your employees, which will in turn make top prospects want to work for you. 

THE CONS

It can discourage employees from participating in the company’s health benefits. For some, the idea of required participation in a wellness program is intimidating. If an employee doesn’t reach the company’s goal and money is involved, it can potentially add stress. Participation then becomes unaffordable and an employee may seek health benefits elsewhere. 

Behavioral differences. We come in different shapes and sizes, and that’s OK. Health is made up of numerous factors, and some are out of a person’s control. For instance, some people are genetically predisposed to high blood pressure, high cholesterol, and even diabetes, and it is important to take these factors into consideration when developing an effective wellness program.