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Wellness Outsourcing on the Rise

Companies today are increasingly looking to Wellness programs as a means of meeting their business objectives. It’s a two sided-approach and benefit.

  • First, the cost of employees missing work due to sickness, diseases and stress-related illnesses can be significant in terms of healthcare costs and productivity. Per Towers Watson, employer healthcare costs are expected to increase 4.4% on average in 2014.
  • Secondly, companies are seeking wellness programs to increase employee engagement, leading to increased productivity, retention and improved quality of work and customer satisfaction.

Wellness programs can take various forms and include:

  • Education
  • Clinical services including prevention services
  • Programs and health initiatives, e.g. fitness centers, weight loss and may also include rewards for achievement of objectives

HRO providers are astute in recognizing this growing interest and have been developing their offerings. NelsonHall finds that ~20% of vendors who provide benefits administration services are either launching or expanding their health and wellness offerings. Some examples include:

  • Mercer, in July 2014 launched Mercer Benefits U, a total wellness education campaign for employees whose retirement and health plans it administers
  • WageWorks and Summit Health partnered for Wellness, February 2014. Summit Health is a provider of on-site wellness, health screening and immunization programs
  • Ceridian, in October 2013 launched an enhanced wellness offering which includes: life health assessment; online workshops; team and individual exercises including exercise, walking and nutrition challenges; incentives, and a knowledgebase health library
  • ADP, launched its Vitality Wellness offering in August 2012, and its contract with The Jackson Companies includes a wellness portal, health risk assessments, biometric screenings and personalized wellness plans with  recommended goals and activities.

Mobile apps for wellness are developing and include:

  • Ceridian’s mobile companion app, allowing participants to record and track progress toward health goals and its LifeWorks app for EAP, work-life and wellness resources
  • Xerox’s Benefit Wallet app, to manage multiple health accounts including HSAs, HRAs. FSAs, HIAs (health/wellness incentive accounts), and other specialized services.

We will see HRO buyers accelerate seeking the help of their benefits providers to develop and administer Wellness programs as organizations place greater emphasis on the development and optimization of their talent. The next step needs to be more companies using analytics to measure the impact of their programs. Per the Hay Group, only 58% of companies with Wellness programs are measuring their performance. Yet another opportunity for HRO providers to help their clients!

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