Anyone interested in implementing an employee wellness program has undoubtedly had at least one conversation about the return on investment (ROI) or lack thereof for such programs. But most of these discussions fail to realize the sheer number of variables that go into setting insurance premiums. These premiums are typically the primary factor when determining a wellness plan’s ROI.
For most companies, no matter how successful your wellness program, there’s little chance your wellness program lowers insurance premiums.
Plus, even if your insurance costs did decrease, it’s next to impossible to prove a direct, causal link between your wellness program and your healthcare spend. So, it’s important to recalibrate your expectations for an employee wellness program when first establishing your own.
In this article, we’re going to tell you why your company needs a wellness program and how it benefits your organization. So, keep reading to find out five tangible reasons a quality employee wellness program matters for your business.
Reasons Why an Employee Wellness Plan Matters
Even if you cannot prove a clear ROI for your wellness program, there are several tangible reasons a quality employee wellness plan matters for both employers and employees.
Learn 7 ways your firm can build a quality wellness program.
1. Help Build Healthy Habits
It’s essential to frame your wellness plan not as a weight loss, or exercise regimen, but as a tool to help your staff build healthy life habits. Developing healthy habits is vital to a culture of health and wellness. And, as PwC found, a commitment to healthy habits is more important than the specific habits themselves.

There are numerous ways employers can help their staff improve their health. Good sleep, healthy eating, exercise, and proper hydration are all examples of separate yet equally important pieces of overall well-being. If you limit your wellness plan to a single area, you limit your plan’s ability to affect the most people at one time.
So, make sure your wellness program is holistic and encompasses every area of employee health. A comprehensive well-being plan that helps employees build sustained, healthy habits can help your wellness program create tangible ROI.
2. Better Customer Service
One reason a quality employee wellness plan is vital for employers is such a program can help improve customer service. And, quality customer service is central to the success of any business. When employees are stressed, experiencing financial difficulties, or are sick, they bring these issues with them to work. For employees who are client-facing, this can result in poor customer service.
But employees with high levels of well-being, per Forbes, tend to provide better customer service, display more enthusiasm, and are more productive. When you help your staff achieve higher levels of wellness, it’s more likely they service your clients better.
3. More Engaged Employees
One of the most significant reasons to implement a wellness program is the potential improvement in engagement some employers have found better employee wellness can bring. A quality wellness plan can align employer and employee values, which goes a long way to improving employee engagement. Similarly, the healthier and more satisfied employees are, the more likely they are to be engaged with their job.

And because only 35 percent of U.S. employees are engaged in their jobs, according to Gallup, improving employee engagement can be a boom to overall company productivity. Gallup found teams who score in the top 20 percent in engagement realize a 41 percent reduction in absenteeism and 59 percent less turnover.
4. Lower Turnover
Another substantial reason to implement a wellness policy is the effect improved employee wellness can have on reducing turnover. Wellness programs, according to a recent study from PwC, can improve your employees’ intent to stay. And this intent, per PwC, is a “key predictor of actual future turnover.”
Likewise, according to a 2017 Mercer study, employers who create cultures of health see 11 percent lower turnover than employers who did little to prioritize employee well-being. Reducing turnover is vital for any organization, as most HR or C-Suite leaders likely know.
Per Gallup, turnover costs U.S. employers over $1 trillion a year. That’s $1 trillion with a “T.” Replacing a lost employee costs anywhere between 33 and 150 percent of that employee’s annual salary. Boosting retention through your wellness program can help your business save on these potentially exorbitant recruiting, hiring, and training costs.
Learn 9 ways your business can upgrade your workplace wellness plan.
5. Reduced Healthcare Costs
The final purpose of establishing a quality employee wellness plan is to reduce your employee’s and company’s healthcare spend. In 2018, the average American spent $11,172 per person on healthcare. Moreover, this average is only expected to increase for 2019 and into 2020.

As previously discussed, building healthy habits through your wellness plan is imperative to the overall well-being of your staff. According to the previously mentioned study from PwC, healthy habits, “significantly impacted at least half of the well-being outcomes studied.”
So, if your wellness program is effective at building healthy employee habits, it increases the likelihood of your staff spending less per year on healthcare. Through their wellness program, and related improvements in wellness and decreased healthcare reimbursements, IBM saved almost $190 million in two years. Similarly, Humana found active employees in their wellbeing plan saved an average of $116 a month on healthcare costs.
The Wrap
While it may be impossible to prove a direct, causal link between your wellness program that shouldn’t stop you from implementing one of your own. The five reasons above illustrate just how significant an impact a quality employee wellness plan can have on your employees and business, in general.
And stay tuned next week, when we detail 5 easy steps your organization can take to build a quality workplace wellness program. Build a quality workplace wellness plan and realize just how much living well can impact your business.