Tips for Evaluating Your Employee Wellness Program

Most employers invest in wellness programs because of the undeniable benefits. These benefits are known to promote a healthier, happier, and more productive workforce. What’s more, many job seekers will not accept a job from an employer that does not offer wellness programs.

Wellness programs are becoming a must-have for employers looking to edge out their competitors in a tight labor market. But to reap a solid return on investment, the wellness program needs to be successfully managed.

To reap a solid return on investment, the wellness program needs to be successfully managed.

You must also verify the program is working as intended. To determine this, you’ll need to evaluate the efficacy of the program periodically. Before we discuss the evaluation, let’s examine some important statistics on wellness programs.

Key findings on employee wellness programs

According to a 2022 report by Zippia:

• 52% of employers in the United States provide wellness programs.
• 72% of employers had fewer healthcare costs after adopting a wellness program.
• On average, employers receive a 6-1 return on investment on their wellness programs.
• Wellness programs can lower absenteeism by 14-19%.
• 56% of employees who participate in their employer’s wellness program say they take fewer sick days because of the program.

An employee wellness program may include:

• General wellness
• Onsite seasonal flu vaccinations
• Tobacco cessation
• Health risk assessments
• Rewards for completing health and wellness programs
• Weight loss
• Stress management
• Meditation
• Preventive care
• Personal or life coaching
• Health insurance premium discounts

What are the reasons to evaluate your wellness program?

Before you start the evaluation process, it’s important to know why it must be done. Here are 3 reasons why:

• It lets you justify the program’s existence.
• Also, it helps you figure out how to fund the program in cost-effective and time-saving ways.
• It gives you tangible evidence of the program’s efficacy — which you can share with stakeholders, including employees.

This tangible evidence may answer questions such as:

• Whether the wellness program achieved its objectives
• The most effective areas of the program
• How to improve the program
• The return on investment
• Whether employees are aware of (and support) the program
• Additionally, whether the findings can help establish best practices for the program
• Whether new policies may be needed

Now, let’s delve into the process for evaluating an employee wellness program.

Set clear goals for performing the evaluation

For example, the evaluation may seek to uncover the following information:

• How employees feel about your wellness program
• How many employees participate in the program, and why they chose to
• Additionally, how many employees do not participate, and why they chose not to
• Whether you should eliminate the program altogether
• Whether you should remove only certain parts of the program
• How to improve the program

Establish relevant metrics

To know how well your wellness program is performing, you’ll need to know what to measure. Ultimately, this depends on the breadth and specifics of your wellness program.

One way to establish metrics is to categorize them under larger, associated umbrellas. Below are examples.

Risk factor metrics

• Absenteeism. The amount of time employees do not show up for work, but are still paid. Causes may include stress, illness, entitled mindset, unsafe workplace, toxic work relationships, family needs, etc.
• The amount of time employees show up for work, but are not productive. Causes may include inadequate training, lack of sleep, family distractions, etc.
• The percentage of employees who leave the company during a specified time (e.g., monthly, quarterly, or annually). Causes of unplanned departures may include low morale, dissatisfaction with pay and/or benefits, etc.

After identifying absenteeism, presenteeism, and turnover as risk factors, you can set up metrics for tracking the rates, reasons, and consequences of each one. Importantly, to what extent did your wellness program assist with each of these 3 components?

Program promotion metrics

• How are you encouraging employees to participate in your wellness program?

Common approaches include new hire orientation, employee handbooks, newsletters, email, message boards, open enrollment, and an online information center.

• How effective are your methods of promotion?
• Who’s responsible for promoting the program? How well do they execute this task?
• What are the direct and indirect costs of promoting the program?
• How does poor wellness-program promotion impact the company?

Program communication metrics

• How are you informing employees about your wellness program? Oftentimes, program promotion and program communication methods overlap.
• Also, how frequently and extensively are you communicating the program to employees?
• How engaged are your employees during program communication sessions?
• Additionally, how do you communicate program changes to employees?
• How effective are your communication methods?
• Who’s responsible for educating employees about your wellness program? How well do they execute this task?
• What are the direct and indirect costs of communicating the program to employees?
• How does poor communication about your wellness program impact the company?

Program participation metrics

• How many employees are enrolled in each wellness benefit?
• What are the main factors driving individual and family enrollment?
• What are the actual utilization rates? This is to gauge the number of employees (and dependents) who actually utilize a wellness benefit, not just the number of enrollees.
• What are the main factors driving utilization?
• What is the drop-out rate per wellness benefit? Why did employees choose to discontinue the benefit?
• How does low enrollment and utilization impact the company?

What are additional areas to evaluate?

• Program access. How are employees accessing wellness information? Do they mostly have to contact HR with questions? Or do you give them access to a wellness platform that makes it easy to learn their wellness options and enroll in programs?
• Program administration. How does your HR or benefits team administer your wellness program? Do they leverage automated technology to manage employee benefits?
• Program costs. How much do you pay for each wellness benefit? What is each employee’s cost-sharing amount? Are these costs affordable to you and your employees? How does cost impact enrollment and utilization? How much do you spend on program technology and administration? Are your wellness programs sufficiently funded? What is the return on investment for each wellness benefit?
• Program vendors. Are you and your employees satisfied with your wellness vendors? This includes their product offerings, quality of service, and costs.

Review the data of the results of the evaluation

Based on the results of your evaluation, you can determine:

• How to improve your wellness program. You may need to remove under-utilized programs and/or add new ones that employees are likely to use.
• Employee engagement and satisfaction rates when it comes to your wellness program.
• How to save time and money on your wellness initiatives and programs.
• How to strengthen your wellness program as an attraction and retention tool.
• Which wellness policies and procedures should be modified or implemented from scratch.
• Whether you should scrap the program altogether. For example, would it be better to upgrade your health insurance options instead of keeping your wellness program?

When to evaluate your wellness program

Ideally, you should evaluate your wellness program at least once per year. Certain aspects of the program may need to be evaluated more frequently (e.g., absenteeism) — such as every 6 months or when an urgent need for updated data arises.

Tailor your wellness program evaluation to your business

Wellness programs play a vital role in employee health and productivity. But to ensure the program is working as it should, you must evaluate it from time to time.

We’ve provided examples of what might be included in the evaluation. However, details vary by employer. You may also need to employ various techniques to get the answers you need, such as reporting, analytics, and employee benefits satisfaction surveys.