Returns on Investment in
Workplace Wellbeing Programs
Presented by:
Jeremy W. Bray, PhD
Department of Economics
Bryan School of Business and Economics
The University of North Carolina at Greensboro
Georgia Karuntzos, PhD
Jesse Hinde
RTI International
Context
• Many researchers and program developers think workplace
stakeholders require that wellbeing programs bring positive
economic benefits to the workplace
– While documenting economic benefits is a necessary part of the
adoption decision process for most workplaces, these benefits
by themselves will seldom convince a workplace to adopt a
program
– The economic benefit needed to support adoption of wellbeing
programs by any given organization is critically dependent on
the context and needs of each organization
• Concerns about overstating the economic benefits of
workplace wellbeing efforts have generated a growing
backlash among some commentators
Outline of Presentation
• The return on investment (ROI) potential: brief
overview of the cost to employers of poor
worker health
• The ROI evidence: the I, the R, and the ROI
• An alternative approach: cost-effectiveness
analysis (CEA)
Costs of Poor Worker Health
Source: NIOSH [2012]. Research Compendium: The NIOSH Total Worker HealthTM Program: Seminal Research Papers 2012. Washington, DC: U.S.
Department of Health and Human Services, Public Health Service, Centers for Disease Control and Prevention, National Institute for Occupational Safety
and Health, DHHS (NIOSH) Publication No. 2012-146, 2012 May:1-214.
Opportunity For Savings
Source: NIOSH [2012]. Research Compendium: The NIOSH Total Worker HealthTM Program: Seminal Research Papers 2012. Washington, DC: U.S.
Department of Health and Human Services, Public Health Service, Centers for Disease Control and Prevention, National Institute for Occupational Safety
and Health, DHHS (NIOSH) Publication No. 2012-146, 2012 May:1-214.
Benefits of Workplace Wellbeing
To the organization
To the employee
a well-managed health and safety programme
a safe and healthy work environment
a positive and caring image
enhanced self-esteem
improved staff morale
reduced stress
reduced staff turnover
improved morale
reduced absenteeism
increased job satisfaction
increased productivity
increased skills for health protection
reduced health care/insurance costs
improved health
reduced risk of fines and litigation
improved sense of well-being
Source: http://www.who.int/occupational_health/topics/workplace/en/index1.html
The I
• Cost studies document the service delivery costs of workplace
wellbeing programs
• Often misunderstood due to varying use of the term “cost”
– Cost of the problem (lost productivity due to poor health)
– Micro-costing studies of program costs
• To date, formal micro-costing-based cost studies are almost
nonexistent in the workplace wellbeing literature
• Cost studies from the Work, Family, and Health Network
(Barbosa et al., 2014; Dowd et al., 2015)
Work, Family, and Health Network
(WFHN)
• Six teams of investigators conducting research
in diverse workplaces
• Interdisciplinary across social, behavioral, and
health sciences
• Two US partner employers
– Telecommunications firm (Tomo)
– Healthcare/long term care firm (Leef)
• Phase I: 2005-2008
• Phase II: 2009-2015
WFHN Goals
• Conduct interdisciplinary evidence-based
research in the area of work and family programs
and policies to reduce work family conflict
• Introduce health and wellbeing as the primary
outcomes of interest in this area of research
• Improve the health of workers, their families and
employers by providing the scientific evidence
necessary to effect change in the workplace
WFHN Funding
• Eunice Kennedy Shriver National Institute of Child Health
and Human Development (Grants # U01HD051217,
U01HD051218, U01HD051256, U01HD051276)
• National Institute on Aging (Grant # U01AG027669)
• Office of Behavioral and Social Sciences Research
• National Institute for Occupational Safety and Health
(Grants # U01OH008788, U01HD059773)
• Additional funding from
–
–
–
–
National Heart, Lung, and Blood Institute (Grant #R01HL107240)
William T. Grant Foundation
Alfred P. Sloan Foundation
US Department of Health and Human Services Administration
for Children and Families
WFHN Intervention Costs in Tomo
Source: Barbosa, C, Bray, J, Brockwood, K, & Reeves, D. (2013). Costs of a Work-Family Intervention: Evidence From
the Work, Family, and Health Network. American Journal of Health Promotion, 28(4): 209-217.
WFHN Intervention Costs in Leef
Category
Cost Type
Resource(s)
Cost (2011$)
146 hours
4,449
Non-labor
-
0
Total
-
4,449
Labor
300 hours
11,381
Participatory session contract, software licenses, iPods, travel
349,864
Total
-
361,245
Labor
1,956 hours
47,466
Office space, handout materials
4,675
-
52,140
Customization
Labor
Start-up
Non-labor
Implementation
Non-labor
Total
Total cost of START
Total cost of START per participant (n=545)
417,834
767
Source: Dowd, W.N., Bray, J.W., Barbosa, C., Brockwood, K., Kaiser, D., Mills, M., Hurtado, D.A., Wipfl, B. (2015). Cost and Return on Investment of a WorkFamily Intervention in the Extended Care Industry: Evidence from the Work, Family, and Health Network.
The R
• Numerous studies have demonstrated the
effectiveness of workplace wellness/wellbeing
programs on the target health behavior
• Studies also show effectiveness on workplace
outcomes (e.g., productivity)
Source: NIOSH [2012]. Research Compendium: The NIOSH Total Worker HealthTM Program: Seminal Research Papers 2012.
Washington, DC: U.S. Department of Health and Human Services, Public Health Service, Centers for Disease Control and
Prevention, National Institute for Occupational Safety and Health, DHHS (NIOSH) Publication No. 2012-146, 2012 May:1-214.
Source: NIOSH [2012]. Research Compendium: The NIOSH Total Worker HealthTM Program: Seminal Research Papers 2012.
Washington, DC: U.S. Department of Health and Human Services, Public Health Service, Centers for Disease Control and
Prevention, National Institute for Occupational Safety and Health, DHHS (NIOSH) Publication No. 2012-146, 2012 May:1-214.
The ROI
• Meta-analyses (e.g., Chapman, 2005; Goetzel
et al., 1999) suggest that workplace wellness
programs save $3 for every $1 invested
• Despite this evidence, many doubts remain
(National Institute for Health Care
Management, 2011; DiNardo, Horwitz, & Kelly,
2013; Horwitz, Kelly, & DiNardo, 2013)
The ROI
“Three years after wellness was hailed as perhaps the
only truly bipartisan component of the Affordable Care
Act, both lay and trade commentators have begun
observing that the assumptions behind it were
incorrect while downsides were overlooked. As a
predictable result, savings have proven elusive even in
seemingly ideal baseline circumstances for health
improvement.” – Al Lewis and Vik Khanna in the Health
Affairs Blog, April 29, 2013
The ROI
Source: Caloyeras, J. P., Liu, H., Exum, E., Broderick, M., & Mattke, S. (2014). Managing manifest diseases, but
not health risks, saved PepsiCo money over seven years. Health Affairs, 33(1), 124-131.
WFHN ROI in Tomo
Covariate
STAR participant
Baseline costs to employer
Male
Age
Race: Indian
Race: Non-white, non-Indian
College graduate
Constant
ROI
Organizational Costs
-2,187.78
(4,207.03)
2.08***
(0.37)
1,410.45
(3,537.30)
-799.06***
(196.27)
16,595.36*
(6,572.22)
-376.71
(4,169.645)
272.09
(2,592.68)
80,198.54***
(21,140.43)
Intervention Costs
690.77***
(14.60)
-17.36
(12.26)
3.32**
(0.97)
-17.79
(19.72)
-33.289
(17.02)
9.64
(18.10)
-72.44
(61.73)
2.17
(4.85)
N=960; * p<0.05, ** p<0.01, *** p<0.001
Dependent variables expressed in U.S. dollars, 2011 prices; cluster-robust standard errors in parentheses.
ROI standard error calculated using a cluster-robust bootstrap routine with 1,000 replications.
Source: Barbosa, C., Bray, J.W., Dowd, W.N., Mills, M.J., Kelly, E.L., Moen, P., & Wipfli, B. (2015). Return on
investment of a Work-Family Intervention: Evidence from the Work, Family, and Health Network. Journal of
Occupational and Environmental Medicine. 57(9): 943–951.
WFHN ROI in Leef
Adjusted Means‡
Control
9,965.18
(787.67)
STAR
10,345.57
(634.89)
ROI§
Point Estimate
Confidence Interval
-1.54
-4.90 – 2.49
U.S. dollars, 2011 prices.
‡Adjusted means (standard errors) computed using recycled predictions.
§ROI calculated as (∆E-C)/C, where ∆E is the marginal effect of STAR on organizational costs and C is the average intervention cost. Confidence intervals
calculated using a cluster-robust bootstrap routine with 1,000 replications.
Source: Dowd, W.N., Bray, J.W., Barbosa, C., Brockwood, K., Kaiser, D., Mills, M., Hurtado, D.A., Wipfl, B. (2015). Cost and Return on Investment of a WorkFamily Intervention in the Extended Care Industry: Evidence from the Work, Family, and Health Network.
An Alternative Approach: CEA
• Looks at value for money using the
incremental cost effectiveness ratio (ICER)
• Helps chose among alternatives assuming
something will be adopted, but does not give
information on whether or not to adopt
• Different outcomes may have different
effectiveness so that one program may not be
cost-effective for all outcomes
European Wellness CEAs
• Nutrition and exercise (Robroek et al., 2012)
• Cardiovascular disease prevention
(Groeneveld et al., 2011)
• Depression (Phillips et al., 2013)
• CEAs of interventions for musculoskeletal
disorders in reducing absenteeism are now so
prolific that three separate systematic reviews
have been published since 2010 (Carroll et al.,
2010; Palmer et al., 2012; Squires et al. 2012)
Parting Thoughts
• Competing stakeholders and perspectives
– Industry
– Employee
– Government
• Research is needed
– Need more quality evaluations of workplace
wellbeing programs
– Need better quality research on cost savings and
ROI
Questions?