Support our non-partisan non-profit newsroom 💜 Donate now

The shortcomings of the corporate wellness program

Kai Ryssdal Sep 18, 2014
HTML EMBED:
COPY

The shortcomings of the corporate wellness program

Kai Ryssdal Sep 18, 2014
HTML EMBED:
COPY

Corporate wellness programs have become a $6 billion industry for one, possibly flawed, reason: they help reduce companies’ healthcare costs, while saving their employees money.

To some degree, they have been a success. Growth in premiums has hit its lowest point in the last 16 years. A new survey by the Kaiser Family Foundation shows that 71 percent of employers believe corporate wellness programs are either “very” or “somewhat” effective at reducing spending on providing benefits for their employees, who would be rewarded with these benefits by meeting various incentives.

But companies can also impose a penalty. They can charge an employee more for smoking or being overweight. It’s the very reason why, says Professor Nancy Koehn of the Harvard Business School, these programs don’t work.

“What’s really happening in many instances is that costs are getting shifted to employees, whether it’s because they don’t meet certain goals or they don’t conform in certain ways,” she says. “Healthcare costs are going down for companies, but not so much for individuals and families.”

And they’re not having any lasting effects on their health, either, she adds.

“All these incentives, all these hurdles, greatly increase the cost of testing employees. So these things are more costly than you might think.”

 Listen to the full conversation in the audio player above.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.