Wellness Programs May Trim Health Costs

Companies And Employees Save On Insurance With New Health Initiatives

(CBS)  It's lunchtime at IBM's sprawling headquarters near New York. The fitness center is filling up, there's a basketball game going on and the hallways are so full of power walkers, you might mistake the place for an indoor track, CBS News correspondent Wyatt Andrews reports.

Shari Chiara, an executive assistant, is gearing up to meet her walking team. As her team of regulars tells it, what powers the power walking is cash. IBM pays them to do this.

Over the last two years, she says she has pocketed at least $600.

And it's serious money. IBM has given employees more than $130 million in what are called wellness incentives, or payments to get healthy. If you stop smoking, that's $150. If you exercise three times a week, you get $150. If you fill out a health record, which flags employees to their individual risk of disease, you get another $150.

Last year, Chiara lost 35 pounds, which cured her asthma and back pain, and earned her $300. She says she hasn't had a sick day in more than two years.

And this is not just happening at IBM. Wellness is now corporate America's hot new strategy for controlling health care costs. In exchange for staying fit, other companies might offer you an iPod, or reward points for purchases or a discount on your health insurance premium.

You can also get wellness incentives from some of the nation's biggest health insurers, including Wellpoint and United Health's PacifiCare and Horizon Blue Cross.

But even if your employer or insurer doesn't offer incentives, for almost anyone, getting fit means lower medical bills.

"I know for myself, I'm healthier so obviously I'm costing them less money in health care," Chiara says.

For companies, it's all about the money. Studies show $3 in health care savings for every for every $1 spent on wellness.

"That's a cost reduction to us, it's a cost reduction to the plan, it's a cost reduction to the employees," says Randy McDonald, IBM's head of human resources.

McDonald says the company — and its employees — save by preventing heart attacks and obesity. "We believe that prevention is the right way to go," he says.

Why cash? "Well it's real simple. Cash gets people's attention, and we wanted their attention," McDonald says.

Judging by the gym at lunchtime, the company got their attention. More than 65,000 people — half of IBM's workforce — are in the wellness program.

[msraven2]

So what happens if you're already healthy? No fair they're not getting paid to stay that way on their own. I rather see health insurance rates drop and see more preventive care given to people who can't afford an health insurance in the first place. It's ridiculous to pay people to stay healthy when IBM is laying off people to cut costs. Give me a break.

[ann_marie_99]

To those who say your company can't afford a program like this: How many sick days would it take your average employee to earn $150 in pay and benefits? One? Two? Three at the most? You can keep your employees from needing to take sick days by helping them stay healthy. $150 is enough to motivate most people to make a healthy lifestyle change. After all, half of IBMers in the U.S. choose to participate, and those are busy professionals, not people who necessarily need the extra $$. These programs are also great for morale. By the way, none of the IBM programs are tied to losing weight.

[bloube]

Thank you for the segment on Wellness! The trend should be to reward employees to embrace healthy habits and daily physical activity. Healthy employees are more productive and save companies' health care dollars, which translates to lower absenteeism, lower workers comp claims and ultimately a more competitive workforce. Corporate Fitness Works provides customized fitness and wellness solutions for corporations that include program design, management and evaluation. Our conviction is to set the standard for creating well cultures that encourage individual and corporate well-being.
Contact www.corporatefitnessworks.com and get started today.

[wellness360]

My current employer flexSCAN has taken IBM's strategy and has created an opportunity for EVERY employer to pay employees to stay healthy. My company offers cash incentives to both employers and employees to participate in a FREE wellness program entitled wellness360. Log onto www.wellness360.com and click on the enrollment video to learn more about the program. Best of health!

[plane51]

Great idea but most employers and insurance companies would rather spend millions in disease treatment than prevention.This only skyrockets health premiums.When are they gonna wake up?

[artesiax3]

IBM's wellness program is great. For companies that want to promote wellness but don't have the budget that IBM and other giants have there are other ways. Sometimes just giving your employees permission to use the space and resources available will help. Set an example, invite them to join you on a walk, have a healthy newsletter delivered to them and be supportive of whatever effor they're making to be healthy and fit.

[homeydklown2]

I have worked out regularly for 6 years now and have to say, I feel better at 43 than I have felt since my 20`s. As a re-habbed smoker, I was putiign on a lot of weight when I quit and started having consistent back aches. It was suggested by a freind that I start working out to help strengthen the weak areas of my abdomin that were the leading cause to my back aches. Since that day I have not had a back ache at all. This was made possible through my employers corporate YMCA Account. Thanks Boss, I have never felt better

[lonestartnow]

As co-founder of a grassroots wellness initiative, I agree with what this story offers--I've seen it first hand. But I want to add, that not all companies are IBMs with the budget for a fitness center and cash incentives. Statistics from the US Dept. of Health and Human Services and NIDDK point out that medical expenses for US employees range from about $114 for normal-weight employees to $573 for overweight to more than $650 for obese employees. There are many small, effective programs, ours is an example, that are making a huge difference to employers who recognize the need but must proceed on a smaller, but no less successful, scale.

[babenothappy]

If this is supposed to be a cost savings then why does the cost of my share of the insurance steadily increase every year? Why can't I afford to insure my family?

[baye13]

So what happens when your 103 Lb. employee gets very sick.
What then?