Reining In Health Care Costs By Emphasizing Wellness Programs

With the obesity epidemic escalating health care costs into the stratosphere -- medical expenditures for morbidly obese adults in 2000 were 81 percent higher than those of normal weight -- and insurance premiums soaring, companies are taking different approaches. And, some are helping employees take more responsibility for their own health choices by investing in in-house programs that emphasize wellness.

A good example is the Alabama-based American Cast Pipe Co., where a fitness center is located next door to the machine shop where 5,000-pound pipes are made. And sitting across the street is a full-service primary care clinic. According to this awesome USA Today piece, American Cast Pipe employees brag about their weight-loss efforts and lower cholesterol levels, and not only for their continued good health: Those who maintain it receive a yearly bonus.

A solid reason for taking an interest in the health of employees and offering incentives in the form of bonuses: The Alabama company saves 20 percent in health costs on those who reach the top tiers of health alone, which has translated into $2 million over nearly a decade. Overall, the company saves more than $1 million annually, factoring in better productivity, reduced health care costs and the onset of chronic disease.

Here's another comparison worth your consideration: American Cast Pipe estimated one employee who is successfully fighting off obesity and diabetes costs the company $1,600 in total health care expenditures last year. The average employee who did nothing to treat his ongoing diabetes could cost his company more nine times than amount annually.

One employee who took responsibility for his high cholesterol and eventually became an aerobics instructor at the company said it best: You can buy medicine, but not health.

USA Today August 1, 2005

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