Academic journal article Public Personnel Management

Local Government Wellness Programs: A Viable Option to Decrease Healthcare Costs and Improve Productivity

Academic journal article Public Personnel Management

Local Government Wellness Programs: A Viable Option to Decrease Healthcare Costs and Improve Productivity

Article excerpt

Tipping the scales at more than 350 pounds, City of Coppell, Texas, employee Stephanie Tumlison knew she needed to do something about her weight. Her unhealthy eating habits and sedentary lifestyle made her feel tired at work and at home. Her weight problem not only resulted in her agonizing about her appearance, but increasingly created worries about her health. In 2004, Tumlison finally decided to take matters into her own hands when she joined the City of Coppell Living Well Program. "I've lost 210.6 pounds. It was the foundation of the [city's] program that got me to the point to say; okay this is what I'm going to do." (1) Tumlison's story of success and her battle with unhealthy lifestyle choices is echoed all across America. The City of Coppell, like many other local governments across the Dallas-Fort Worth Metroplex, are increasingly joining the ranks of organizations across the nation that are looking at ways to help employees succeed in their own personal health goals.

Helping employees develop a healthy lifestyle can ultimately benefit an organization's bottom line in a number of ways. Not only can a city increase productivity and decrease absenteeism, but it can also save hundreds of thousands of dollars a year in escalating insurance premium costs. Coppell deputy city manager Clay Phillips noted that "spending a few dollars on the front end makes sense not only for the organization and the employee, but also for the taxpayer. Health insurance premiums are fiat, the city is being recognized nationally by the Wellness Councils of America, and success stories like those of our employees are inspiring." (2)

The rising cost of health care has caused a number of municipalities to look for viable alternatives to increasing premiums. One such alternative has been the now popular health promotion programs or wellness programs that are geared to improve employee's physical, emotional, and psychological health. A failure to try something new would invariably lead to increased premiums and deductibles and dramatically scale back benefit levels. The principal reasons therefore, for the rise in employee wellness programs all over the nation, are mainly due to employers seeing the programs as a means to help reduce rising healthcare costs and maintain a healthy workforce.

U.S. health care spending is expected to increase for the next decade reaching $4 trillion in 2015, or 20 percent of GDP. (3) In 2005, employer health insurance premiums increased by 9.2 percent--nearly three times the rate of inflation. The annual premium for an employer health plan covering a family of four averaged nearly $11,000. The annual premium for single coverage averaged more than $4,000. (4)

The effects of rising health care costs are giving both private and public employers limited options for providing total compensation packages. To attract and retain top professionals both sectors need to balance the demands on the organizations' funds with appealing benefit packages. The 2006 U.S. Chamber of Commerce's annual Employee Benefits Study showed that employee benefit costs swelled in 2005 and now account for more than 44% of payroll expenses. The report goes on to say that the cost of employee benefits, as a percent of payroll, has risen 4 percentage points over the past year. Medically related expenses cost employers $5,924 per employee, or 14.5% of payroll, up from 11.9% as cited in last year's Employee Benefits Study. (5)

A second reason for concern for local governments is the state of health of their employees. The Center for Disease Control recently reported that obesity increases employer costs--including medical expenditures and absenteeism, by $460 to $2,500 per obese employee per year. (6) The leading cause of death in the United States today is heart disease. A major contributor to this disease is the sedentary life style and poor eating habits of a majority of the people. According to the National Center for Health Statistics 30 percent of U. …

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