Companies looking to reduce health plan costs while maximizing employee quality of life may want to consider coupling a workplace wellness program with a High Deductible Health Plan (HDHP) and Health Savings Account (HSA).
Workplace Wellness Programs
Wellness programs help employees become healthier as well as better consumers of healthcare in three ways:
- Supporting healthy behavior in the workplace
- Improving health outcomes
- Lowering employer healthcare costs
Employers may offer wellness initiatives to help employees make better lifestyle choices and improve their health. But cost control may also be a goal. Zippia research from November 2022 found that 52% of U.S. companies offer wellness programs, with 72% of employers reporting reduced healthcare costs after program implementation.
Wellness programs are gaining popularity because they benefit both employers and employees. Some employers link them to Health Savings Accounts (HSAs) to increase participation.
Employer Benefits
While employers naturally benefit from healthier, more satisfied employees, lowering healthcare expenses is often the primary motivator for offering wellness. Wellness programs have been shown to reduce company health plan costs and worker’s compensation experience rates. Other benefits to employers include:
- Reduced absenteeism
- Increased productivity
- Healthier, happier employees with higher job satisfaction
- Less workforce turnover
Employee Health Benefits
From an employee perspective, the greatest benefit of workplace wellness programs is the development of long-term healthy lifestyle choices and behaviors. People engaged in wellness activities tend to look and feel healthier and have a more positive attitude overall. They tend to eat healthier, exercise more often, smoke less, and avoid excessive drinking. They wear seat belts more often, which significantly reduces crippling or debilitating injuries from car accidents.
Workplace wellness programs can also reduce chronic diseases by lessening the impact of behaviors that lead to them. For example, regular exercising, quitting smoking, eating healthier, and reducing stress can lower cholesterol and blood pressure levels and reduce the chances of heart attack and other types of heart disease.
Employee Financial Benefits
Workplace wellness programs can also reduce the cost of healthcare to employees. Healthier people tend to get sick less often, meaning fewer doctor visits and less spent on medications and other healthcare expenses. In addition to better health outcomes and lower healthcare costs, wellness programs offer employees many other attractive benefits, including:
- Improved mental health, including less depression
- A sense of community and connection with co-workers
- Greater job satisfaction
- A sense of accomplishment
HSAs and Wellness Programs
Employee participation is critical to maximizing the benefits of any workplace wellness program. In most cases, a large portion of the workforce must enroll to justify the employer’s wellness program cost. Many employers offer rewards to encourage enrollment, including gym memberships, gift certificates, or cash bonuses.
One idea gaining traction is linking employee wellness to Health Savings Accounts. Tax-advantaged HSA accounts let employees pay for various eligible healthcare expenses using pre-tax funds. To open and contribute to an HSA, an employee must first enroll in a qualified High Deductible Health Plan (HDHP).
HDHP premiums are lower because the employee pays a larger share of healthcare costs through a larger deductible. As an incentive to enroll in the HDHP, the employer may partially fund employee HSA accounts. Employees can use the employer contributions to help pay for qualified medical expenses or invest them to grow their balance.
Many studies show that employees with HDHPs are more likely to research the cost of healthcare services than those with traditional health plans. They also participate in wellness programs at a higher rate and are more aware of the incentives offered to encourage enrollment.
Keep in mind that participation in workplace wellness programs must be voluntary. In addition, there are limits on the amount of incentives employers can provide, and some incentives are taxable. However, as employees become more engaged with their healthcare – through the HDHP and wellness programs – their medical expenses usually trend downward.
Linking a High Deductible Health Plan to a wellness program won’t provide a cure-all for lowering health plan costs. But for employers seeking to reduce costs in part by encouraging wellness program participation, it can play a big part in a more comprehensive solution.
For 40 years, DataPath has been a pivotal force in the employee benefits, financial services, and insurance industries. The company’s flagship DataPath Summit platform offers an integrated solution for managing CDH, HSA, Well-Being, COBRA, and Billing. Through its partnership with Accelergent Growth Solutions, DataPath also offers expert BPO services, automation, outsourced customer service, and award-winning marketing services.
