How would employers qualify for the tax credit?
To qualify, wellness programs would be required to include health risk assessments, health awareness and behavior change programs, meaningful incentives for participation and an employee committee that tailors programs to meet workforce needs.
The Secretary of Health and Human Services, in conjunction with the Centers for Disease Control and Prevention, certify which programs qualify, but all programs must:
- Include at least three of the following four components: health awareness, behavior change, employee engagement and supportive environments
- Use practices that are consistent with evidence-based research and best-practice environments
- Focus on employee populations with disproportionate health burdens, be culturally competent and meet employees’ health literacy needs
- Offer all programs to all employees who work at least 25 hours per week
The bill also instructs the Secretary of the Treasury and the CDC to develop an outreach program to make employers aware of the credit and what steps need to be taken in order to qualify.
What incentives do companies have to invest money in programs promoting healthy lifestyles and disease prevention?
Workplace wellness programs are economical. They typically cost from $20 to $200 per employee, and some well-implemented programs produce a return of $10 for every dollar invested.
The tax credit caps at $200 per employee for businesses with fewer than 200 employees. For those businesses with more than 200 employees, the credit caps at $100 per employee. If passed, the Healthy Workforce Act can motivate small and medium-sized employers to get involved in worksite wellness programs.
In the small and medium-sized employer market, the human resources director is wearing a lot of hats. In most cases, that person does not have the time to take away from his or her normal job responsibilities to develop and implement a wellness program. They really need someone else to do it for them. Working with a consultant or outside wellness provider can add cost to any wellness initiative, and this credit can possibly bridge the gap for a company considering this route.
How do wellness programs benefit businesses?
This type of legislation is long overdue. The return on investment from wellness programs can be justified if you take into consideration not only the reduction in health care costs but also the health dividends associated with a healthy workforce such as improved productivity and presenteeism, decreased absenteeism and workers’ compensation costs. In the end, the benefits of a well-designed comprehensive wellness program far outweigh the costs.
Sally Stephens is president of Spectrum Health Systems. Reach her at (317) 573-7600 or [email protected].