February 5, 2015

ROI – Once again, revisited

We have talked about ROI in the past, many time and also in our companion newsletter. However, we recently came across an blog article which is stunning in content, reporting on a peer reviewed study performed by Navistar, a larger employer heavily involved in creating a “culture of health” for the corporation and its employees. The period under observation was 1999 through 2009; and the results were so overwhelmingly positive that “. . . ROI calculations and the time and effort to calculate and report them came to be seen as unnecessary.”

A few excerpts from the blog article found on the site Health Affairs

Exhibit 1: Cost Savings Achieved by a Culture of Health Company. This is a graphic comparison of Navistar’s direct cost trend with the U.S. average. It demonstrates that while the cost curve remained about equal to the U.S. average initially, it began to decline after four years (of staying the course) and was more than 20 points below the U.S. average by 2009. (These are peer reviewed and audited data)

Exhibit 2: Productivity Gains Achieved in a Workplace Culture of Health. Depicted in this table are various data points which reflect a comparison of 2001/2 to 2008/9. Absenteeism hrs/employee/year dropped by one third; workers comp incidents/100 employees/year dropped by one half.

Exhibit 3: Savings in a Workplace Culture of Health Across The Human Spectrum. This table is dramatic, to say the least. It shows direct and indirect cost savings per employee for healthy employees (a drop) as well as individually for specific medical conditions. For back problems alone, the savings were more than $5,000/employee/year.

I could go on and on about the data, the article, etc. But, I think you get the point. Wellness, a focus on healthy lifestyles and prevention do pay off. Let’s move on – the savings are there if you do it right. We may have differences of opinion about how to calculate ROI, but we shouldn’t still be arguing over whether it can be achieved.

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Filed Under: Research

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