Corporate wellness programs have become a cause celebre of the cost-saving era in healthcare. Everyone has started using employee wellness plans and there are plenty of ways to try them.
But there’s one catch: few corporate wellness solutions are saving money.
“We probably shouldn’t think of wellness programs as cost-savers, at least not in the short-term,” says Gautam Gowrisankaran, a professor of economics at the University of Arizona. He recently completed a study of a large wellness program at a major hospital in St. Louis, published Monday in the journal Health Affairs.
While the program did seem to change the way that employees accessed health care, it did not produce savings for the hospital system, BJC Healthcare.
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The news is not ideal timing considering the themes in this week’s World Health Care Congress in Washington, D.C., where scores of companies were selling services, apps and other employee wellness plans that they hope will engage patients and save money for corporate America.
But if you’re thinking about cost savings first, you’re not thinking properly about employee wellness programs, said Josh Stevens, CEO of Keas, a San Francisco-based social and game-focused provider of corporate wellness. Keas was making a big push at World Health Care Congress, which wrapped up on Wednesday.
The company has raised more than $17 million in private capital from the likes of Ignition Partners and Atlas Ventures, but completely revamped and launched a new wellness product back in February. Keas is now on the verge of closing a new round of capital to expand its business, Stevens said.
To Stevens, cost savings is “half a loaf. The full story is engagement and productivity.” He said employers launching new corporate wellness programs should look at these key factors:
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- Are you seeing productivity gains? Before the cost savings begin, employers should see an uptick in worker productivity. Is morale improving, is there an increase in collaboration and teamwork, or is paid time off dropping? Stevens says the first year of any good wellness program is about employee productivity and not cash.
- What’s happening with the MAUs… also known as Monthly Active Users. Many wellness programs experience a drop in participants as the months go on. But if a significant number of employees keep coming back to participate in wellness programs then you know you have something, Stevens said.
- Can the employees relate? Is the wellness program integrated into the workflow of the employees – or is it asking workers to do things they would never otherwise do?
Stevens had a fourth factor: Is it holistic? That’s a little self serving, considering Keas’ new product is dubbed “360/365” (360 degrees, 365 days a year). But Stevens argues that without a program that can help an employee at home, at work, online, in real time and beyond that wellness just won’t work.
“It has to be engaging every day of the year,” he said. “Otherwise it’s just an event.”
In Keas’ new product, employee teams can complete against one another, win prizes (top teams get bigger rewards), and can leverage the Keas social network to share how many steps they’ve walked or goals they’ve made on their other fitness devices. The company’s co-founder, former Google Health leader Adam Bosworth, said up to 90 percent of participants are more productive after using Keas products.
There’s been a lot of enthusiasm over wellness, but there’s also been some push back, too. CVS Caremark employees, for example, said their employer was invading their privacy by launching an aggressive wellness program.
Stevens said he hasn’t seen that. “We’re hearing the opposite,” he said.
