July 2007

Wellness bill introduced into Senate

A bill to encourage employers to implement workplace wellness programs that produce results has been introduced into Congress. Sen. Tom Harkin (D-IA) and Sen. Gordon Smith (R-OR) have introduced the Healthy Workforce Act. 

The bill would provide tax incentives to businesses, particularly small- and medium-sized employers that provide opportunities for their employees to lead healthier lives and prevent chronic illnesses. And it could be an opportunity for healthcare providers, such as chiropractors, who provide wellness and weight-loss programs.

Preventable chronic illnesses, such as diabetes and heart disease, affect more than 33 percent of working-age Americans and make up nearly 75 percent of the nation’s total healthcare costs. Some companies report spending more than 50 percent of their profits to cover healthcare expenses for their employees.  

Employers are increasingly bearing the costs of diet-related chronic diseases and obesity through employer-provided healthcare plans and indirectly through higher rates of absenteeism. Obesity alone costs employers approximately $33 billion in healthcare and other indirect costs.

Employer spending on health promotion and chronic disease prevention is a good investment. Studies have reported a proven rate of return ranging from $2 to $10 for each dollar invested. Workplace wellness programs are also economical, averaging $30 to $200 per employee.

“Preventing these chronic diseases and unhealthy lifestyles not only helps individuals live longer and more fulfilling lives, it saves money,” said Harkin. “For example, proactive treatment of hypertension costs about $1,000 per year whereas treatment for a heart attack … costs a minimum of $50,000, not including time off and loss of productivity.”

The Healthy Workforce Act would provide a tax credit of up to $200 per employee for the first 200 employees, and up to $100 per employee thereafter, to businesses that offer comprehensive wellness programs.

Types of employee wellness programs eligible for the tax credit must include three of the following four provisions: 

• Health awareness programs that include education and health risk assessment programs;

• Behavioral-change programs that encourage employees to lead a healthy lifestyle through counseling, seminars, or online programs, including classes about nutrition, stress management, or smoking cessation;

• A supportive environment to encourage employee participation in workplace wellness programs, which could include offering meaningful incentives to participating employees, such as a reduction in health insurance premiums; and

• An employee-engagement committee, which would tailor the wellness program to the needs of the workforce at a particular company.

An employer can receive the tax credit for 10 years after establishing a new, qualified wellness program.

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