It’s 2011,the Affordable Care Act is coming into existence, and the price of health insurance is going up for businesses. Patty Burke and the management team at Central Collision Center had to ask themselves: How can we reduce our healthcare costs? (Editor’s note: Central Collision Center was acquired by Service King on Feb. 27.)
Instead of simply accepting those costs, Burke, Central Collision’s human resources manager, decided to be proactive rather than reactive, and found a way to curb health insurance spending—an intricate, full-blown wellness program for the 90 employees at the business’s six Chicagoland locations.
Three years before rules regarding wellness programs were put into place by the U.S. Department of Labor in January 2014, Burke was putting a wellness program into place that would track the employees’ daily activities, from walking around the shop to exercising in their free time to daily household chores, and offer incentives for being active in their day-to-day lives.
“We try to build a better awareness with our employees so that they’re taking care of themselves,” Burke says. “The thought process is that if they’re more informed on health matters and going to the doctor for their wellness checks and their physicals, then they’re taking better care of themselves. The goal is to have healthier lifestyles and reduce claims and trips to the doctors.”
Nearly half of the nation’s employers, according to a report from Aflac, offer some type of wellness program initiative, growing from 30 percent in 2011 to 44 percent in 2013. And after new nationwide rules and incentives were set in place by the Affordable Care Act one year ago, those numbers are going up. The total of incentives offered through a wellness program has been upped from 20 to 30 percent of the cost of health coverage. Employers now have the option of reducing the amount for coverage they charge individuals participating in workplace wellness. In addition, the maximum reward level can be increased by another 20 percent for action aimed at preventing and reducing tobacco use.
While the incentives are enticing, setting up your very own individual wellness program is no easy task—especially an effective one that will ultimately save on healthcare costs. The new Department of Labor rules state that workplace wellness programs must be reasonably designed and not overly burdensome, and offer reasonable alternatives to employees with medical conditions.
Three years into their own wellness program, according to Burke, the employees at Central Collision are feeling fitter, happier and healthier, and it’s all thanks to a carefully designed and multi-faceted program full of rewards and incentives.
The first step in establishing a wellness program is creating profiles for all of the employees—starting with a wellness screening.
“We do those annually,” Burke says. “It is a blood draw, and they do blood pressure, weight, a BMI measurement, and then a health snapshot questionnaire. So it sort of gives you a whole picture of your health at that time.”
The cost of the wellness screening through CHC Wellness is $135 per person. The shop provides the screening at no cost to employees. Each employee received a confidential, easy-to-read report card of their overall health including detailed results of blood tests. Central Collision also provides basic wellness screenings, available through its insurance carrier, at no cost to them or the employee. Each person received a one-on-one coaching session immediately following the screening.
An employee survey conducted by the RAND Corporation showed just over 70 percent of employers combine screening activities and interventions for their wellness programs. Preventative intervention is key, says Burke, as is targeting employees with risk factors for chronic disease and improving disease control in employees with chronic conditions.
However, research from RAND shows that only 46 percent of employees eligible for wellness programs participate in wellness screenings. Burke says Central Collision has a 92 percent participation rate, which probably has to do with the rewards offered through the pedometer program.
Tracking your steps:
Regardless of whether or not an employee is on the shop’s healthcare program, Central Collision’s 90 employees, including management, are encouraged to participate in a pedometer program, set up through a subscription with Virgin Pulse.
“It’s really a cool program because it really gets you more engaged,” Burke says, “because you’re wearing this pedometer 24/7 and you’re really seeing how active you are.”
The pedometer keeps track of how many steps you take, and the data is stored for each employee, who can manage his or her personal activity journal online. Points, or “health miles,” are earned for each step and entries into the activity journal, which can include anything from swimming a few laps and lifting weights to gardening and mowing the lawn. Employees can upload their steps by plugging their pedometers into a computer or through Bluetooth. The latest pedometers even allow employees to sync automatically with their iPhones.
Burke says the pedometer program is especially effective for the office staff, which will have to do more activity outside the office to keep up with the technician staff.
“Our culture is split because we have technicians that are in the shop and moving all day, and then we have our office staff that is more of a desk job and not getting as many steps unless they’re intentional about it,” Burke says. “The whole point is to get people moving to see what your current level of activity or lack thereof is, and then to go from there and try to reach the goals that are established in the pedometer program.”
The first pedometer is on the shop and costs $25. The pedometer comes with a one-year warranty (water damage is not covered). Employees are responsible for replacing their pedometer if they lose or wash it. They also cover the subscription cost for each employee—$12 per month. Overall, the pedometer program comes to an average cost of about $63 per employee per year.
Burke says that over 70 percent of the employees participate in the pedometer program—a higher percentage than most businesses can obtain just for wellness screenings. So how does she entice employees to participate?
“Our company is pretty competitive,” Burke says. “When there’s an opportunity to earn extra points through the pedometer program by having challenges, people are quick to participate.”
Burke splits each location and the management into separate teams, for a total of seven. Then she sets up quarterly challenges with various themes, and each team vies to come out on top for extra health miles and other prizes. Burke sends out updates of who is in the lead for a particular challenge, encouraging people to get out and be more active.
The shop even takes the time to set up larger events that encourage long-term lifestyle changes, such as their Summer Slim-Down contest, which was Burke’s own version of “The Biggest Loser.” Through these challenges, Central Collision has produced a number of success stories, with some employees losing as much as 30 pounds or more.
“For the guys, they’re looking to take a bit off that midsection as they get older,” Burke says. “And learning to eat better and the importance of exercise, they really point towards the program that got their attention. And, you know, their spouses kind of like it, too.”
While being happier, healthier human beings is certainly a draw for employees, Burke realizes that an active reward system will keep staff and management more engaged and more likely to make long-term lifestyle changes.
In addition to competing with one another, employees are encouraged to challenge themselves. They have one year to go through five levels, and each level is achieved by logging a certain amount of health miles.
Reaching 6,000 miles puts you in Level 2, which will earn you a modest prize, such as a free lunch or a movie gift card. If you reach Level 3—12,000 health miles—then you can earn $40 and have the opportunity to upgrade your pedometer.
Level 4 is where it gets interesting.
“If you reach Level 4 in the first year of your pedometer program, then they earn the incentive of 10-percent savings on their health insurance for the cost of their own personal health insurance,” Burke says. “So that’s the big one. And it’s not easy to get to Level 4, so you really have to put forth the effort and do some extra stuff in order to get ahead, and you really have to be intentional about doing more than just regular activity on a day-to-day basis.”
If you’re a real superstar, Level 5 awaits, which nets a Central Collision employee $100. And, if you remain tobacco-free for the entire year? That’s even more points to help you reach the final level.
“We’ve tried other prizes, but it’s really the cash that gets their attention,” Burke says.
Health insurance savings:
Burke says it’s hard to measure exactly how much a wellness program can save, but the real advantage comes when bargaining for insurance.
“If you’re actively sponsoring a wellness program, when it comes time for a renewal on your health insurance, that’s something we can go to our providers and say, ‘This is what we’re doing and we’re being very proactive with it and we’re getting good results,’ and it’s a negotiating tool that helps with the overall renewal,” Burke says.
According to World Economic Forum (WEF) statistics, companies that implement proactive wellness programs average $700 in savings per employee per year. These companies also receive a 755 percent return on investment in reduced healthcare costs.
Savings can be found in increased work productivity as well. A study by the Principal Financial Group found that 45 percent of workers remain at their jobs because of wellness programs, and 26 percent of workers miss fewer days of work.
Burke says she has noticed how the Central Collision employees are, generally, more fit and buoyant at work, which, in turn, is leading to a stronger, more cost-efficient health insurance program.
“Healthier, happier employees is huge for us, and it also kind of helps with our culture and awareness and brings us more together,” Burke says. “We have a family culture here and it really brings us more together.”