Despite all the uncertainty still surrounding the Patient Protection and Affordable Care Act (PPACA) one year after its passage, there seems to be little doubt that at least one approach to reforming health care is gaining favor: wellness initiatives. 

Wellness: Here to stay, even if health care reform isn't

Despite all the uncertainty still surrounding the Patient Protection and Affordable Care Act (PPACA) one year after its passage, there seems to be little doubt that at least one approach to reforming health care is gaining favor: wellness initiatives.

Almost daily, it seems, evidence mounts showing that wellness programs - once viewed as no more than a perk to attract and keep employees - are becoming effective strategies to control employers' health care spending and contain escalating health care costs.

"With or without health care reform, healthy employees will save you money," said Charles Daye, Senior Vice President of Human Resources for Ceridian. "It's becoming clearer that the benefits of wellness programs are significant: They lower health care costs, lower rates of absenteeism, increase productivity and improve employee morale."

Congress seems to agree that corporate wellness initiatives are essential to the health of the nation, even if Republicans and Democrats agree on little else regarding health care reform. Under PPACA, beginning in 2014, employers will be allowed to increase the incentive they offer group health plan participants for taking part in an outcomes-based wellness program from 20% to 30% of the employee's health plan premium.

"Wellness programs may have had a more modest impact in the past because of low participation rates," said Daye. "But due in part to PPACA, we're learning that offering rewards can make a real difference in employee interest and engagement in these programs."

In addition, PPACA provides an incentive for small businesses to implement workplace wellness programs by making available $200 million in grants to employers with fewer than 100 employees who work 25 or more hours per week.

The grants, available until 2015 through the Department of Health and Human Services (HHS), will reward employers for offering new wellness programs that include health awareness initiatives, encourage employee participation, offer counseling and coaching services and create supportive and healthy workplace environments. HHS is expected to release more detailed criteria regarding eligible programs and guidelines for employers to follow in applying for the grants.

Wellness programs may include Employee Assistance Programs (EAP) to help workers find professional help for serious issues like addiction or depression and health risk assessments designed to identify specific or chronic health problems. With these services, employees are offered tools and resources to help them improve their health.

The Case for ROI

The strongest case for implementing a wellness program is the solid return on investment that companies can realize by improving the health of their employees.

"Medical costs associated with tobacco use, cardiovascular disease and obesity are well documented, and these behaviors and conditions can be relatively easily correlated to medical claim dollars," said Jen Piliero, Product Manager for Ceridian's Health and Productivity Solutions.

Piliero said Ceridian typically achieves ROIs for its health and wellness offerings that range from $1.50 to over $6 saved for every $1 invested. The average is about $4 saved for every $1 invested in an integrated EAP/work-life solution.

The Advantages of Wellness

The passage of national health care reform last year can be viewed as an opportunity for companies to step back and re-examine their entire employee benefits strategy. The health care reform debate is forcing businesses of all sizes to make decisions about their group health plans and to find ways to contain costs without cutting employee benefits - and incentive-based wellness programs are a natural step toward achieving this goal.

Regardless of how health care reform shapes up in the coming months and years, the focus it has placed on wellness demonstrates that these programs can be powerful when it comes to lowering health care costs and positively impacting the health and productivity of American workers and their families.

"Your employees are your most important resource," Daye said, "so it makes sense to invest in wellness initiatives as a way to become an employer of choice in your area, to attract the best applicants and to keep employees happy and engaged once they're hired.