Mitchell Langbert

Wellness Plans for the Discerning Accounting Firm

How to choose a plan that works.

November 18, 2010
by Mitchell Langbert, PhD

Wellness programs ought to be dull. While wellness programs promise much they are typically thin on substantive outcomes that real world firms can detect. Part of the reason is that the best wellness programs are those that are least glamorous: programs to encourage blood pressure testing, colonoscopies and other cancer screening can save lives and yield dollar and cents results. The programs that are the most fun such as gyms and seminars do not yield the best results. At the same time, many of the effects of wellness programs can take years to materialize. Firms that think long term can reap benefits and save lives.

The literature on wellness abounds with claims of large short term dollar returns on investments but the studies often are flawed. One of the requirements of a meaningful social science study is the presence of a control group that is given a placebo or alternative intervention such as an alternative kind of training. Most of the wellness research does not use a control treatment. Also, the studies are flawed by the absence of controls for the characteristics of individuals who choose to enter the programs. This results in sample selection bias. Much wellness research is flawed.

Picture a firm that introduces a wellness plan that includes a physical fitness facility. Only about fifteen percent of the employees use the fitness facility. A researcher compares the vital statistics of those who use the fitness facility and those who do not, and concludes that there is a statistically significant difference in health claims due to the fitness facility. The problem is that the people using the fitness facility were already healthier before the facility was implemented. Many would have used a gym in any case even if it meant paying to go to Gold’s. In order to participate in an exercise plan one must be healthy in the first place and not experiencing a wide range of disabilities that curtail physical exercise. That is, participants in an exercise plan have a better level of health than non participants even if the plan has no effects at all.

The same is true of many other kinds of wellness interventions, such as addiction and alcohol plans, employee assistance plans and the like. One needs to know the natural rate of recovery of participants and then compare that rate to the recovery rate of participants in the program. Factors such as environment can have enormous effects on addicts’ behavioral patterns. As well, work redesign and environmental factors can confound research studies and may be the source of many psychological problems. But to revise the workplace environment would be costly.
One low cost, high impact approach to wellness is to adopt a screening program coupled with instructions on self-examinations. Sara Lee Corporation adopted such a plan in the 1970s. Employees over age 40 received a health risk appraisal, blood pressure and cholesterol screenings and instructions on stool and breast self-examinations. Screenings for hypertension, colon cancer, prostate cancer and breast cancer can save lives. For many kinds of programs, such as blood pressure programs, cost savings may not be realized for many years. 

There are many program-based threats to validity. In weight-loss programs, for example, attrition rates are high. Even if employees change their behavior during the program, they can easily revert to previous patterns. Weight is subsequently regained in a majority of cases. Moreover, many of the participants who do lose weight might have done so absent a program. At the same time, the presence of a program shows that the firm cares about its employees and about health.

Plan Design and Evaluation

In designing a wellness plan managers ought to review claims data that indicate key health issues in the employee population. Broad aggregate data may also be useful but firms’ employee-based data is best. Employees can be screened and given a questionnaire concerning behavioral patterns to determine potential within-firm health issues. Ongoing health screenings are themselves an important health benefit and source of saving to the firm. There are many cancers and other diseases like adult diabetes that have scant outward manifestations. Worksite health screenings cost a small fraction of doctor visits. Firms might also consider financial incentives to do more intensive screenings with physicians. For example, employees over 50 might be given a dollar incentive to go through a colonoscopy once every five years. Incentives can be applied to other aspects of health promotion as well.

Once key risks are determined, plan managers need to rank risk hazards, employee priorities and an assessment of resources such as fitness facilities that might be available in the community. The firm might consider permitting dependents and family members to participate as well. Firms need to decide whether to adopt a cost-effective basic plan that includes screening and health education or a more comprehensive plan that might include fitness facilities, weight loss, stress management and smoking cessation. Such plans are an excellent benefit even if their cost effects are ambiguous in the short term.

One good program is smoking cessation, which is one of the most cost effective of the wellness programs if a large enough percentage of employees still smoke, but in many environments it is no longer necessary. As well, educational programs can be effective and cost little. The late Donald Vickery, MD pioneered the concept of self-care. Employees can be taught basics of health behavior related to pregnancy or treatment of various ailments that can eliminate needless doctor visits and even save lives.

One factor in the accounting field that may be critical to wellness is stress management. Because of the cyclical nature of tax accounting developing stress management skills may prove to be especially beneficial. In general, a large share of employees suffer from moderate stress. Physical fitness is a component of stress management and so might be best justified in a high-stress accounting environment.

According to the Centers for Disease Control and Prevention, an estimated 45.1% of adults have total blood cholesterol values of 200 mg/dL and higher. Almost 30 percent of the population suffers from cardiovascular disease. In 2009, the economic costs of cardiovascular disease and stroke were over $475 billion. Clearly, there are opportunities for important gains from adoption of a judiciously designed wellness plan. But careful assessment of costs and benefits coupled with legitimate concern for employees are the way to go.

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Mitchell Langbert, PhD, is an Associate Professor at Brooklyn College. Widely published on the subject of human resource management, Langbert has consulted and served as an expert witness.

This article is derived from the book Wellness Programs for Taft Hartley Funds by Mitchell Langbert and Bernard Handel (International Foundation of Employee Benefit Plans, Brookfield, WI, 1992.)