The Volokh Conspiracy
Mostly law professors | Sometimes contrarian | Often libertarian | Always independent
Corporate wellness programs are the thing these days. Large employers seek to provide incentives and opportunities for their employees to lead healthier lifestyles. The idea is that this can improve the health of employees and also aid the bottom line by reducing health insurance costs. But do wellness programs deliver on these promises? And do they have other, hidden costs and consequences? This is the subject of a conference next week (about which, more below).
Writing for the New York Times's Upshot, Austin Frakt and Aaron E. Carroll noted in September 2014 that while corporate wellness programs are increasingly popular, it's not clear they produce a meaningful economic return—and what economic benefits they do produce may come at the expense of workers.
Wellness programs are popular among employers. An analysis by the RAND Corporation found that half of all organizations with 50 or more employees have them. The new survey by the Kaiser Family Foundation found that 36 percent of firms with more than 200 workers, and 18 percent of firms over all, use financial incentives tied to health objectives like weight loss and smoking cessation. Even more large firms - 51 percent of those with 200 workers or more - offer incentives for employees to complete health risk assessments, intended to identify health issues. . . .
The Kaiser survey found that 71 percent of all firms think such programs are "very" or "somewhat" effective, compared with only 47 percent for greater employee cost sharing or 33 percent for tighter networks. . . .
What research exists on wellness programs does not support this optimism. This is, in part, because most studies of wellness programs are of poor quality, using weak methods that suggest that wellness programs are associated with lower savings, but don't prove causation. Or they consider only short-term effects that aren't likely to be sustained. Many such studies are written by the wellness industry itself. More rigorous studies tend to find that wellness programs don't save money and, with few exceptions, do not appreciably improve health. This is often because additional health screenings built into the programs encourage overuse of unnecessary care, pushing spending higher without improving health.
However, this doesn't mean that employers aren't right, in a way. Wellness programs can achieve cost savings - for employers - by shifting higher costs of care onto workers. In particular, workers who don't meet the demands and goals of wellness programs (whether by not participating at all, or by failing to meet benchmarks like a reduction in body mass index) end up paying more. Financial incentives to get healthier sometimes simply become financial penalties on workers who resist participation or who aren't as fit. Some believe this can be a form of discrimination.
Writing in December 2014, Frakt reiterated that such programs "don't save money."
Workplace wellness programs may also be bad for employees. Such programs may not only shift health-care costs onto workers, but also may impose disproportionate costs on those workers the programs are most intended to help, and compromise worker and patient privacy. Some analysts are also concerned that wellness programs violate the Americans With Disabilities Act and encourage employment discrimination.
Despite these and other concerns, workplace wellness programs continue to have their champions and appear to becoming ever more common across the country. Is this a good thing?
On April 15, the Law-Medicine Center at the Case Western Reserve University School of Law is hosting a full-day conference "Corporate Wellness Programs: Are They Hazardous to Well-Being?" Speakers include Dr. Soeren Mattke of the Rand Corporation, Dr. Michael Roizen, chief wellness officer of the Cleveland Clinic Foundation, Prof. Dennis Scanlon of Penn State, Prof. Sam Bagenstos of Michigan, Christopher Kucynski of the EEOC, Prof. Jessica Roberts of the University of Houston, Prof. Harald Schmidt of Penn and Elizabeth Click of CWRU.
Further details on the conference are available here. It is free and open to the public and will be webcast live. CLE credit is also available for a modest fee.