• Are your wellness programs reducing medical and Rx expenses? What is the overall wellness ROI?

    We measure the effectiveness of employer wellness programs by analyzing medical, Rx, and workers' compensation claims data. Our approach compares participants vs. non participants.

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Wellness Program Evaluation

Challenges of Wellness Program Evaluation
Employers should evaluate wellness programs to determine if there is a causal link between program participation and lower healthcare expenses, as well as to gauge the overall ROI of the program. Unfortunately, this involves numerous challenges:

Selection Bias: The ideal measurement approach is to compare the health costs of participant vs. non-participant employees. This approach has a potential flaw: wellness programs are voluntary and tend to attract more motivated and disciplined employees. Employees who don’t participate may be less likely to adhere to programs that require lifestyle changes such as exercise and diet.

Lack of Proper Control Group: Unless the employee base is very large, it may be difficult to find enough employees for a control group who a) did not participate and b) also match the participants in terms of control variables (gender, age, BMI, exercise habits, etc.).

Insufficient Data: A strong analysis typically requires at least two years of wellness program and claims data in order to track health status improvements. Many employers lack two years of data for participating and non-participating employees.

No Focus On Component Parts: Many organizations analyze the overall wellness initiative rather than individual programs. This approach prevents insights into effectiveness at the specific program level, e.g. weight loss.
Vendor Analysis: As many employers lack internal analytics capabilities, they turn to their wellness vendors for the analysis. This is problematic, as it’s not realistic to expect vendors to critically evaluate the results of their own work.

Recommended Solution
Employers need to determine whether program participation leads to improved employee health, health care savings, and an overall positive ROI. A methodologically sound study should:

  • Create two groups of employees, one with and one without participation in wellness programs. In order to isolate the impact of wellness programs, hold constant the variables that can impact health such as age, gender, diet/exercise, etc. For the most accurate results, these variables should be identified before a wellness program is implemented. Employee census records and Health Risk Assessments (HRAs) are common ways of gathering this data.
  • Compare the medical, workers’ compensation, and disability claims for program participants against non-participants. Ideally the non-participant pool should be drawn from employees who were never exposed to wellness programs. Given that such a pool is not always available, employers should look for a third party who can supply a control group of appropriately matched individuals.
  • Measure reductions in cost at various points over the duration of the study to identify short-term vs. long-term cost savings.
  • If studying a program with several separate components (weight loss and smoking cessation, for example), collect results for all components separately rather than just evaluating the success/failure of the program as a whole.