Integrated benefits and wellness solutions in small and medium-sized companies lead to better employee engagement, reduced absence, increased productivity and sustained benefit costs, according to Roger Thorpe, president of Toronto-based Thorpe Benefits.Many companies with up to 500 employees have been crunching the books trying to come up with ways to keep benefit costs down. Employee benefit costs have been rising five per cent year over year and there are concerns that governments may download costs to companies as the Baby Boomer demographic ages. At the same time, absenteeism due to ill health typically reduces productivity, employee engagement and morale. “But if we can turn this around for business, it can actually be a business advantage,” Thorpe said at the launch of his company’s Integrated Benefits and Wellness Solutions in January.
Thorpe said he noticed that companies were asking for ways to turn around their costs about 10 years ago. He went through the claims and administration costs and found some efficiencies, but he also discovered that one of the main cost drivers was the lack of knowledge of how chronic health conditions affect benefit claims.
Expectation and responsibility
Companies wanted to take care of their employees, but there were a number of push-pulls within the organizations: owners wanted to cut costs, while finance and human resources staff was so busy with other issues that wellness fell to the bottom of the list. In the end, employees became more stressed. “There is this strange confusion around expectation and responsibility, around health between the employee and the owner,” said Thorpe.
Many think it’s up to government to look after the health problems of their citizens, but currently, the health care system is buckling under the weight of these bills and anticipate the issue will get even worse with an aging demographic. People have become very dependent on drugs to cure their ills because it’s the fastest and easiest way to do so and they can often get the bill paid through their company drug plan, he said. “Health care at work went from an incidental expense to a serious liability.”
In truth, providing medications to employees does keep them productive and at work, he said. Productivity losses among works with chronic disease are 400 per cent higher than treating the disease.
But as claims rose and ill health cut back on productivity, companies realized that “to do nothing was not an option,” said Thorpe.
The answer, said Thorpe, is managing benefits in company wellness programs. He conceded that “wellness” has become a buzzword that many interpret as employee assistance programs. But he said comprehensive wellness can achieve “amazing” results if done properly.
Thorpe said each company receives a customized plan, which includes some curriculum for employees who are taught about wellness in small amounts. Subjects include boosting immunity through exercise, avoiding sugar, reducing stress levels, getting enough sleep, taking vitamins C and D and eating foods rich in antioxidants.
Add in employee rewards, peer motivation and fun and companies will see greater engagement and health benefits, he said. “For the employer, the benefit is that if you help keep your employees healthy your business will be more competitive.”
This kind of engagement program is especially important for Gen Ys (those born between 1977-1994) who want to see more out of a company than a job, he said.
The programs are bolstered by resources to support employees and help them be more accountable for their own health.
“The expectation is that we will see the financial results within three years,” he said, “but immediately we see the engagement and morale effect. When it comes to sustainability, the wellness plan almost takes on its own life. We give them the tools to go and the curriculum, but they know this is not a one-off thing, this is a long-term commitment.”
Thorpe said the Centres for Disease Control have said that 70 per cent of chronic illnesses can be managed and even averted by changing their lifestyle habits. Active employees take 27 per cent fewer sick days and absence costs are about 2.5 per cent of payroll. Most employees don’t have any motivation to look after themselves on their own, or until they get sick. “So rather than waiting for those symptoms to arrive and spiral out of control, we need to work more proactively with the support of the peers around us.”