MEMORANDUM

DATE: November 29, 2010

TO: James Martin, Director of Human Resources

FROM: Name, Assistant Director of Human Resources

SUBJECT: Wellness Program Recommendations for Technicraft, Inc.

Attached is the report on the implementation of corporate wellness programs.

Due to rising health benefit costs and a rising number of health benefit claims, you requested that I investigate the implementation of corporate wellness programs as a way to reduce company costs. In order to determine whether it would be possible to improve employee health and lifestyle habits, while also cutting company costs, I analyzed the results that several companies had after launching their own wellness programs. I also considered and researched the potential disadvantages of implementing a wellness program. After a thorough investigation of all of these factors, I recommend that Technicraft, Inc. implement a corporate wellness program in order to improve employee health and productivity and reduce or stabilize company health benefit costs.

I have enjoyed researching this topic and would like to meet with you to discuss my recommendation. I will call you early next week in order to schedule a meeting time or you may contact me at extension 5555.

WELLNESS PROGRAM RECCOMMENDATIONS FOR TECHNICRAFT, INC.

Prepared for

James Martin, Director of Human Resources
Technicraft, Inc.
4501 West 92nd Street
Indianapolis, IN 46260

Prepared by

Name, Assistant Director of Human Resources
Technicraft, Inc.
4501 West 92nd Street
Indianapolis, IN 46260

December 5, 2010

TABLE OF CONTENTS Item Page LIST OF ILLUSTRATIONS iii EXECUTIVE SUMMARY iv OVERVIEW 1 TECHNICRAFT, INC. HEALTHCARE INFORMATION 3 BASIC TYPES OF WELLNESS PROGRAMS 5 OVERALL WELL-BEING AND HEALTH OF EMPLOYEES 7 Current Employee Health and Habits 8 Changes in Overall Health as a Result of a Wellness Program 12 Changes in Habits as a Result of a Wellness Program 13 WELLNESS PROGRAM EFFECTS ON TOTAL COST AND CLAIMS 15 POTENTIAL DRAWBACKS OF A WELLNESS PROGRAM 16 SUMMARY AND CONCLUSIONS 17 RECOMMENDATIONS 20 REFERENCES 22 APPENDIX 24 LIST OF ILLUSTRATIONS Tables 1. Percentage of US Employers Offering Wellness Programs in 2009 versus 2007 7 2. Employee Health Survey Results 8 Figures 1. Health Benefit Rates Between 2004 and 2008 4 2. Health Benefit Claims Between 2004 and 2008 4 EXECUTIVE SUMMARY In the last few years, corporate employee wellness programs have been gaining popularity. Companies are using wellness programs not only to cut rising health benefit costs, but also as a way to attempt a reduction in employee absenteeism, improve productivity, improve presenteeism, reduce employee injuries, as well as improve employee morale and retention. The purpose of this report is to research the results several companies have had after the launch of their wellness programs. This report will help determine whether implementing a wellness program at Technicraft, Inc. can improve the overall health and well being of employees as well as lead to a reduction in health benefit claims and cost. The factors that were researched in this report are as follows: Technicraft’s current health care plan including the cost to employees as well as the cost to the company, the current health of Technicraft employees, other companies’ results after the implementation of a wellness program (including the effects on their employees’ overall health, any changes in employee habits, and the effect on health care cost and claims), as well as the potential drawbacks of implementing a wellness plan. Cost is the primary reason for the company’s decision to investigate the possibility of implementing a wellness program. Research has found that employee health, lifestyle habits, and cost are all interrelated; therefore, many companies have bee able to see a great return in investment and save a significant amount of money after the implementation of a wellness program. Companies such as Johnson & Johnson were able to not only reduce the percentage of employees with high blood pressure and high cholesterol, but they were also able to see a significant reduction in the percentage of employees who smoke, and also motivated a small percentage of employees to participate in some form of exercise after their wellness program was launched. As a bonus they were able to save millions in health care costs. Several other companies ranging from financial institutions to mining companies were also able to see positive effects after they put a wellness program into place. Through an employee health survey that was handed out to all salaried and hourly employees, it was discovered that there are several areas that could use improvements including preventative measures, health and employee lifestyles. It was also learned that when asked if the employees felt that a change in their lifestyle could improve their health, 66% answered yes. That shows that the majority of employees believe that they are not in the best health and would most likely be willing to participate in a wellness program. The potential disadvantages of implementing a wellness program were also investigated. It was found the disadvantages mainly revolve around employee lawsuits over Constitutional rights being violated as well as GINA act violations and feeling as if they were treated unfairly. There are also some potential negative emotions and moral issues that can arise if the program details are not delivered in the correct manner or if employees feel as if the program is too intrusive. After reviewing all the successes as well as the possible disadvantages associated with the implementation of a wellness program it is evident that Technicraft, Inc. should develop and launch a corporate wellness program. It can help the company improve productivity, employee health, and cut costs. OVERVIEW

Wellness is defined as “the quality or state of being in good health, especially as an actively sought goal” (“Wellness,” n.d.). Employers are developing wellness programs in order to not only benefit the company’s bottom dollar in the form of health care savings but companies are also finding other benefits that go along with offering wellness programs to their employees. These other benefits include: a reduction in employee absenteeism, improving productivity, improving presenteeism (meaning that even though the employee is physically present at work, they do not feel as productive due to stress or a health related issue), reducing employee injuries, as well as improving employee morale and retention (IN.gov, n.d.). There are several different types of wellness programs available for companies to offer. There are programs that are used to not only benefit the body but also the mind and soul. Some of the major types of wellness programs available besides the health management programs include: Diversity Management, Drugs in the Workplace, Employee Assistance Programs, Ergonomics: Safe Facilities in the Workplace, HIV/AIDS in the Workplace, Interpersonal Skills, Preventing Violence in the Workplace, Safety in the Workplace, and Spirituality in the Workplace (McNamara, n.d.). Due to rising health benefit costs as well as increased health benefit claims, it is imperative that an analysis of these corporate wellness programs be performed. With a thorough investigation, it can be concluded whether this type of program would be of benefit to this company or if simply increasing the amount that employees pay for health benefits would be a wiser choice. This research will determine if implementing a wellness program at Technicraft, Inc will increase the overall health and well being of employees, and in turn result in a reduction of health care claims.
There are several relevant factors that needed to be recognized in order to produce a reliable conclusion. The factors that were identified as relevant for research are as follows: Technicraft’s current health care plan including the cost to employees as well as the cost to the company, the current health of Technicraft employees, other companies’ results after the implementation of a wellness program (including the effects on their employees’ overall health, any changes in employee habits, and the effect on health care cost and claims), as well as the potential drawbacks of implementing a wellness program.
To ensure a thorough investigation, secondary data was gathered including journal and newspaper articles that were retrieved through EBSCOhost, a scholarly online research database. Articles were also gathered from the websites of other reputable organizations including IN.gov and The Wellness Councils of America. The articles used for researched were deemed relevant by assessing the outcomes other companies had after the implementation of a similar wellness program.
Primary data was also used in this investigation. In order to gather primary data on Technicraft’s current health care coverage, Company files were retrieved. In order to determine the employees’ current health and habits, a questionnaire was developed and handed out to all of the salaried and hourly workers. One hundred percent of the 65 salaried employees and 80 percent of the 485 hourly employees responded the questionnaire. The questionnaire evaluated employees’ current habits, including whether the employee smokes and if so how long they have smoked, also whether the employee exercises and how much they exercise. It also evaluated the employees’ current health with questions about blood pressure, cholesterol, and body weight.
This report presents information on changes in habits, overall health, health care claims, healthcare costs, as well as any potential drawbacks of implementing a wellness program, followed by a summary, conclusions, and recommendations for Technicraft, Inc.
TECHNICRAFT, INC HEALTHCARE INFORMATION Technicraft, Inc. currently employs 550 people. The available medical insurance coverage available to these employees is through Gold Key Insurance Company. The medical coverage is as follows: * $800 deductible for individuals and $1600 for families * $400 deductible for in-hospital services per visit * 80% out-of-hospital services with a maximum out-of pocket of $3,000 * $2 million lifetime benefits * $15 co-pay for generic prescriptions * $25 co-pay for non-generic prescriptions * $30 co-pay for office calls * $500 co-pay for use of emergency room * No dental or vision coverage
The cost per month for single employees is currently $155, and the cost for families is $300 per month. The cost of health coverage for employees has also been on the rise. Over the last five years employees have experienced a cost increase of 9% per year on average.
The company is currently paying $7,600 per employee or $800,000 in premiums per year for 2009. Technicraft’s rates have increased over the last five years at an average of 13% per year. There has not only been a steady incline in the health benefit rates, but also in the number health benefit claims over the past 5 years, as shown in Figure 1 and Figure 2 respectively.

Figure 1
Health Benefit Rates Between 2004 and 2008
Source: Primary

Figure 2
Health Benefit Claims Between 2004 and 2008
Source: Primary Figure 1 above shows the steady rate increase that Technicraft has experienced over the last 5 years. The figure shows that rates have increased by: 7.5% in 2004, 7% in 2005, 14% in 2006, 15% in 2007, and 18% in 2008. Figure 2 displays the increase in health benefit claims throughout the same time period. The figure shows that in 2004 there was a 3% increase in claims, in 2005 there was a 3.5% increase, in 2006 there was a 4% increase, in 2007 there was a 4.5% increase, and finally in 2008 there was the highest increase at 5.5%. Both figures show that in 2008 the company experienced its highest increase in both health benefit rates and health benefit claims. If both claim rates and benefit rates have been steadily increasing in the past 5 years, there is a good chance that the company will see yet another increase in 2009 and 2010.
BASIC TYPES OF WELLNESS PROGRAMS When a wellness program is usually mentioned people automatically tend to think of a health care program or a company who is trying to reduce their health care costs. Though that is one type of program available, and a popular motivation for companies to implement this type of program, there are also several other wellness programs available to choose from besides just a health related wellness program. Some major types of wellness programs available today include: Diversity Management, which are programs used to recognize, respect and deal with a progressively more diverse labor force; Drugs in the Workplace, which attempts to combat drug and alcohol issues in the workplace; Employee Assistance Programs, which help employees deal with personal problems that may impact their work performance or overall well being; Ergonomics: Safe Facilities in the Workplace, this program is designed to help control hazards and design a workstation that is considered to be ergonomically safe; HIV/AIDS in the Workplace, this program is designed to help educate employees about HIV/AIDS, it helps employees understand how to protect themselves from infection, and also helps the employees who may be dealing with a current HIV/AIDS infection in either themselves or a family member; Interpersonal Skills, which educates employees on how to deal with conflict, teaches them about building trust, manners, dealing with difficult people, as well as understanding and dealing with office politics; Preventing Violence in the Workplace, this program is designed to help employees understand how to handle workplace violence and harassment, as well as educate them on what to do if they are in a situation where they are witnessing violence in the workplace. This program also aims to talk about what alternatives employees have when it comes to violence as well as educating employees about how much a violence situation could end up costing a company (“Major types of Wellness Programs,” n.d.); Safety in the Workplace, this program promotes overall safety in the workplace and educates employees on how to perform their duties in a safe manner; and finally Spirituality in the Workplace, which is used to promote spirituality and religious diversity in the workplace. This information will give the company an idea of what type of programs are available and which program or programs could meet the specific needs of Technicraft employees (McNamara, n.d.). The implementation of wellness programs in order to encourage a healthier workplace has been consistently gaining popularity throughout the past several years. Towers Watson, formerly Watson Wyatt, a leading global consulting company who help organizations improve performance (Towers Watson, n.d.), along with the National Business Group on Health, who is a non-profit organization that represents large employers’ viewpoint on national health policy issues as well as providing solutions to its members on important health care problems (National Business Group on Health, n.d.), teamed up to conduct a survey of 489 large US employers in January of 2009 to determine what wellness programs employers now offer versus what was previously offered in 2007. Table 1 displays the results of the survey.
Table 1
Percentage of US Employers Offering Wellness Programs in 2009 versus 2007

Wellness Program Offered | Offer Rate in 2007 | Offer Rate in 2009 | Lifestyle Improvement Programs | 43% | 58% | Health Coaches | 44% | 56% | Weight Management Programs | 42% | 52% | Health Risk Appraisals | 72% | 80% |

Source: Healthcare IT News, (2009). Companies continue to add wellness programs, Watson Wyatt/National Business Group On Health survey finds. Retrieved November 2, 2010, from http://www.healthcareitnews.com/press-release/companies-continue-add-wellness-programs-watson-wyattnational-business-group-health-su Table 1 shows that 58% of large US employers are offering lifestyle improvement programs, which is a 15% increase from 2007 where only 43% of employers offered this type of program, 56% of employers are offering health coaches, compared to the 44% of employers who offered this program in 2007, 52% of employers are making weight management programs available to their employees, up from the 42% who offered this program in 2007, and 80% of employers offer health risk appraisals compared to the 72% that offered this in 2007. This table obviously shows an increase in popularity and participation among employers in these wellness programs.
OVERALL WELL-BEING AND HEALTH OF EMPLOYEES The primary concern of Technicraft, Inc. is the employees that make up this company. The question that the research conducted for this report is trying to answer is whether or not a wellness program could improve the overall health and well being of employees, which could then lead to a reduction in health care claims.
Current Employee Health and Habits In order to properly answer the question above, an analysis of the employees’ current state of health and habits needed to be considered. To gather these results, a survey was distributed to all of the hourly and salaried employees (see the appendix for a blank copy of the survey), of which one hundred percent of the salaried employees and 80 percent of the hourly employees returned the survey. Table 2 shows the results of this survey; the results are the percent of employees who responded to the survey.
Table 2
Employee Health Survey Results

Question | Response | Do you currently smoke? | 33% Yes67% No | If you smoke, how long have you smoked? | 7% 0 to 5 years 37% 6 to 10 years56% over 10 years | Is your blood pressure 140/90 or higher? | 23% Yes 51% No 24% Don’t know | How much do you exercise each week outside of your job? | 19% less than 1 hour 40% 1-2 hours 27% 3-4 hours 14% over 4 hours |

Survey continued on next page

What type of exercise do you participate in? | 15% walking swimming lifting weights running bikinghours 5% aerobic classes 5% swimming5% lifting weights10% running5% biking60% none | How much time do you spend each week exercising? | 60% - no time10% - 1 hour20% - 2 hours5% - 3 hours5% - 4 hours | Have you had any of the following medical preventive tests/exams? | 35% mammogram (if a women)17% prostate exam (if a man)15% lung x-ray17% electrocardiogram3% stress test | Are you at least 20 percent over your desired weight? | 26% Yes36% No38% Don’t know | Is your cholesterol over 200? | 39% Yes23% No38% Don’t know | Do you think you are suffering from stress? | 37% Yes29% No34% Don’t know | Does anyone in your family have heart disease or has anyone died of heart disease? | 37% Yes63% No |

Survey continued on next page

Do you wear your seat belt? | 31% part of the time 32% all of the time37% never | Do you believe that changes in your life style would improve your health? | 66% Yes34% No | Does anyone in your family have cancer or has anyone died of cancer? | 29% Yes 71% No | Which of the following would you participate in if offered or subsidized by the company? -Smoking cessation program -Aerobic exercise classes-Medical preventive tests/exams-Diet program-Immunization programs for tetanus, flu, and/or pneumonia | 16%20%41%53%39% |

Source: Primary This table shows that with regard to employee habits, the results showed that 33% of employees smoke, of those 33% of smokers 56% have smoked for over 10 years. 60% of employees said that they do not spend any time participating in exercise each week. When asked if the employees believe that changes in their lifestyles would improve their health 66% answered yes. This means that the majority of the employees who responded to this survey feel as if their habits could be negatively affecting their overall health. It also shows that a decent number of employees have some bad habits that could be having some negative effects on their current state of health. A couple of questions on the survey asked about preventative measures. The first question asked about preventative tests or exams and the following percentages of employees said that they have had each of the following exams: 35% have had a mammogram (if a woman), 17% have had a prostate exam (if a man), 15% have had a lung x-ray, 17% had a electrocardiogram, and 3% have had a stress test. The other preventative measure question asked on the survey was whether or not the employees wore their seat belts. The results of this question revealed that 31% of employees only wear their seat belts part of the time, while 37% say that they never wear their seatbelts. These results reveal that the majority of employees are not participating in any preventative measures to keep themselves healthy and safe. The next sets of questions asked were about their current health and family history. As far as current health is concerned, 23% of employees say that their blood pressure is 140/90 or higher, while 24% answered that they did not know, which means that the percentage of high blood pressure employees could much higher than 23%. The survey also showed that 39% of employees had cholesterol of over 200, while 38% did not know; 26% of employees are at least 20 percent over their desired weight, while 38% did not know. The employees were also asked about their current stress level and 37% of employees say that they are suffering from stress, while 34% did not know. With all of those results, a rather high percentage of employees were not sure how to answer the questions, so again the percentages suffering from those particular health issues could be higher. To get an idea of family history, the survey asked if anyone in their families had heart disease or had died of heart disease, of which 37% of employees answered yes. It was also asked if anyone in their families had cancer or if anyone in their families had died of cancer, of which 29% said yes. As far as family history is concerned, the majority of employees do not have a family history or cancer of heart disease. The final question in the survey was asked to get a general idea of what types of wellness programs that the employees would be willing to participate in. The results are as follows: 16% of employees would participate in a smoking cessation program, 20% of employees would participate in aerobic exercise classes, 41% of employees would participate in medical preventative tests or exams, 53% of employees would participate in a diet program, and 39% of employees would participate in immunization programs from tetanus, flu, and/or pneumonia. The results of the last question could prove to be useful if it is decided to design a wellness program for the company. It could help in designing a program that will be geared towards the current interests of employees and thus have a better probability of employee participation.
Changes In Overall Health as a Result of a Wellness Program
The next area of investigation is whether or not a wellness program can have a positive effect on the overall health of employees. In order to determine this, the results of other companies’ wellness programs were analyzed. The first company analyzed is a 261-bed community hospital in southeast Michigan that implemented a wellness program called Wellness QUEST. After a 10-month period, the hospital saw that 62% of the 378 employees who enrolled in the program ended up completing the program. Of those employees, 67% (157 employees) met seven of the 10 indicators of wellness that the hospital set up in order to gauge how successful the participants of the program were. 68% of those employees saw a drop in total cholesterol, 40% reduced their percent body fat, 100% of employees were back injury free, and 93% experienced a reduction in their blood pressure (Bulaclac, 1996).
Johnson & Johnson, a company who takes great pride in upholding and improving the health of their employees, have also seen some positive effects in their wellness programs. Between 1995 and 1999, 14% of Johnson & Johnson employees had high blood pressure and 19% had high cholesterol. In 2007 and 2008 those percentages declined to 6% and 7% respectively (Johnson & Johnson, n.d.).
Studies of the wellness programs provided by a few Milwaukee area companies also showed some successful results as it relates to employee health. Northwestern Mutual employs 5,000 people and has had a wellness program in place since 1993, since 2006 the company has been able to stabilize their percentage of overweight employees at 35%. That percentage is lower than both the national and state averages. And finally, P&H Mining, whose program launched in 2004, has reduced the number of “strains and sprains” experienced by their employees by 36% since 2005 (Hess, 2010).
All of the companies mentioned above were able to see some great improvements in the overall health and well being of their employees. Healthy employees can help reduce unscheduled absenteeism, which can cost a company a lot of money, it can also improve productivity because if an employee physically feels good, they are more likely to get more done than if employees are coming to work injured or sick. It can also result in less health care claims and hospital stays due to illnesses and injuries.
Changes in Habits as a Result of a Wellness Program A change in employee health is not the only measure of success for these wellness programs. A positive change in the habits and lifestyles of employees is also a tremendous indicator of success. The hospital in southeast Michigan that was mentioned above, not only saw a positive change in employee health, they also saw some positive employee lifestyle changes. Of those 157 employees who were deemed as having successful results in the program, 99% were now wearing their seat belts, 58% participated in wellness activities, 94% were tobacco-free, 78% participate in fitness exercise and 76% of those employees did not have any unscheduled absences from work (Bulaclac, 1996).
Johnson & Johnson’s habit changes were with smoking and exercise. Between 1995 and 1999 12% of Johnson & Johnson employees claimed to be smokers, that percentage ended up decreasing to only 4% of their employees smoking between 2007 and 2008. Also, 39% of employees claimed inactivity, meaning that they performed no type of exercise, between 1995 and 1999. That particular percentage dropped to 32% of employees claiming inactivity between 2007 and 2008 (Johnson & Johnson, n.d.). Helwig Carbon Products, who implemented their program in 2004, has seen a 17 percent increase in employee productivity between 2005 and 2009. The Metropolitan Milwaukee Association of Commerce, who also launched their wellness program in 2004, uses an overall wellness score as a judge of the success of their programs. This wellness score is based on both employee habits and behaviors. In 2006, the score for the company was 34, which is in the “needs improving/fair” range. In 2009 that score improved to 50, which is in the “doing well/good” category. P&H Mining has reported a lost time reduction of 100 percent between the first quarter of 2009 and the first quarter of 2010 (Hess, 2010). If employees are exercising more, their bodies and muscles become stronger, which leads to better joint support and less joint pain. Exercise can reduce body fat, which can in turn lower blood pressure and cholesterol levels. Exercise also tends to have a positive mental effect on people as well because as body fat is reduced, peoples’ body image tends to improve and they feel happier with themselves. Not smoking obviously reduces the possibility of lung disease and cancer, and preventative measures such as seat belt use and regular check ups promote safety and also constantly make people aware of their current state of health. All of these factors can potentially lead to cost reductions as well because the healthier employees are the less likely they are to go to hospitals and miss days of work.
WELLNESS PROGRAM EFFECTS ON TOTAL COST AND CLAIMS After discovering all of the significant successes companies have had improving the overall health of employees, as well as encouraging positive lifestyle changes, the next area of investigation had to be whether companies with wellness programs in place were able to reap any cost benefits from the programs. The Wellness Councils of America has been able to summarize some interesting cost benefits among several companies in the United States. The first company mentioned is Providence Everett Medical Center, located in Everett, Washington, who was able to save an estimated 3 million dollars over 9 years through their wellness program called the Wellness Challenge®. Du Pont Co. was able to yield a return of $1.42 for each dollar they invested in their wellness program, solely through lower absenteeism over a two-year period. The Travelers Corporation was able to yield a total corporate savings of $146 million in benefits costs. Lastly, Berk-Tec, a small manufacturing company in Pennsylvania, was able to achieve a 24.3% reduction in healthcare costs in just one year. With that short of a time period that is an amazing cost reduction (The Wellness Councils of America, n.d.). A couple of the Milwaukee based companies mentioned earlier in this report also saw some decreased claims and costs. P&H Mining has not seen a workers’ compensation cost increase since 2005 and Helwig Carbon Products not only has been able to get their health care costs per employee below the national average, they have also gotten a 1.6-to-1 return on investment through their wellness program.
POTENTIAL DRAWBACKS OF A WELLNESS PROGRAM In order to make a sound decision, both the positives and the negatives of a situation need to be assessed. This is why the final step in this investigation is to research any of the drawbacks associated with these kinds of programs. The first potential drawback found is with Title I of the Genetic Information Nondiscrimination Act of 2008, also known as GINA. GINA is an act that prohibits health plans and health insurance issuers from discriminating in group premiums or contribution rates based on genetic information, requesting or requiring any individuals to undergo any sort of genetic testing, using any sort of genetic information for underwriting purposes, and using any genetic information prior to, or in connection with an individuals enrollment in a health related plan. These regulations do not prohibit the use of health risk assessments or wellness programs; they just aim to eliminate the improper request or collection of genetic information (Hoseman, 2010). These regulations need to be followed extremely close with any health related surveys or questionnaires handed out by Technicraft, as well as used in the design or creation of any wellness program, if that is the decision made. If any of these regulations are broken it can lead to a lawsuit that could potentially be detrimental to the company. Besides lawsuits over a potential violation of the GINA Act, there are also several other potential lawsuits that can result is the company isn’t extremely careful. Some lawsuits that have incurred in relation to wellness programs include a Scott’s Miracle-Gro employee who sued the company when he was fired after testing positive for nicotine because it violated a company policy that banned smoking, whether on or off the job. Another lawsuit came from Michigan firefighters who ended up suing the fire department because they felt that the required periodic blood tests for cholesterol screenings violated their Constitutional rights (Quinley, 2009). Another possible drawback to using a wellness program comes from adverse employee attitudes and morale that can potentially arise. While some employees may find these programs to be great and beneficial, there are employees who feel as if these programs can become too intrusive. There are many employees who are left feeling as if their time away from the company should not be regulated by the company, this can lead to increasingly negative feelings about the company which can in turn lead to a reduction in productivity or even the loss of certain employees.
SUMMARY AND CONCLUSTIONS In summary, a corporate wellness program is a program that is designed to improve the overall health, well being, and safety of employees. These programs are steadily gaining popularity among companies as a way to battle rising health benefit costs, reduce employee absenteeism, improve productivity, improve presenteeism, reduce employee injuries, as well as improve employee morale and retention. The successful results of several companies who have implemented wellness programs and were able to make changes in employee health, habits as well as reduce benefit costs and claims were also discussed in this report. In order to have thorough knowledge of the subject, both the advantages and disadvantages of wellness programs needed to be researched; therefore, the potential drawbacks of wellness programs were also examined. Additionally, the results of the Technicraft, Inc. Employee Health Survey were also important to this investigation. Based on the primary data, both the employees and the company have seen increasing health benefit costs over the last five years. On top of the ever-increasing rates, the company has also seen a steady incline in the number of health care claims over the same five-year period. The employee health survey revealed that there is much room for improvement in both employee habits and overall health. The survey also revealed that 66% of employees believe that a lifestyle change would result in an improvement of their health. This survey also revealed that several employees would be willing to participate in different types of wellness programs if they were made available to them. Primary data suggests that not only is Technicraft facing increasing costs from health benefits, it also has some employee health issues as well. If employee health, habits, and preventative measures don’t improve, then the cost the company is incurring for benefits is also not likely to improve. Through secondary data, it was found that there are several basic types of wellness programs are available to choose from besides basic health and wellness programs. These other programs are: Diversity Management, Drugs in the Workplace, Employee Assistance Programs, Ergonomics: Safe Facilities in the Workplace, HIV/AIDS in the Workplace, Interpersonal Skills, Preventing Violence in the Workplace, Safety in the Workplace, and Spirituality in the Workplace. After an analysis of each of these programs, it was found that for the current purposes of Technicraft, a basic health and wellness program would be a good starting point, if results are positive the incorporation of other programs such as safety in the workplace, could also promote continued success. Through a significant amount of secondary research some great positive results were found from other companies who had implemented a wellness program. Several companies were able to make changes in employee habits and preventative measures. Some of the changes companies were able to make included: more employees wearing seatbelts, employees participating in exercise, and employees being tobacco free. These habit changes would also lead to an overall improvement in employee health and safety.
Secondary research also revealed that several companies were able to have successful turnouts as it relates to an overall health improvement within their workforce. Many employees were able to reduce their blood pressure, cholesterol, and body fat percentage.
Because employee lifestyle, health and the cost of health benefits are all interrelated many of these companies have also been able to get a significant return in investment, as well as claim reductions. Because there have been so many documented successes with these programs, with all different types of companies, there is a good probability that Technicraft can also have some similar results with the implementation of a wellness program. The potential drawbacks to also keep in mind that were discovered through secondary research include lawsuits due to a violation of the GINA act, lawsuits due to employees feeling as if their constitutional rights have been violated, and lawsuits due to employees feeling as if they have been discriminated upon or treated unfairly. Another potential drawback could be with adverse employee attitudes and morale that could arise due to employees feeling as if the program is too intrusive. Because of these potential drawbacks, Technicraft would have to make sure that any wellness program to be implemented would follow all GINA guidelines as well as all other employee federal laws, and that the presentation of the wellness program should be well thought out and properly presented as to attempt to avoid any unhappy employees. After reviewing the primary and secondary data, all of the advantages and disadvantages associated with the implementation of a wellness program were analyzed. The benefits of implementing a wellness program were increased productivity, reduced absenteeism, positive changes in employee habits and lifestyles, increase in overall employee health, as well as a benefits cost reduction. After review all of the results from other companies, comparing those results to the current needs of Technicraft and weighing in all of the possible disadvantages, it has been concluded that Technicraft, Inc. could benefit from launching a wellness program.
RECOMMENDATIONS
Based on these conclusions, Technicraft, Inc. should implement a wellness program in order to improve the overall well being and health of employees as well as reduce the number of health benefit claims and costs. To implement a wellness program at Technicraft, Inc., a company wide meeting should be held in order to present the company’s plan to employees as well as to educate them on all of the possible benefits this program could provide them. It must be clear to all employees that this program is going to be implemented as a benefit to the employees, as they will not be incurring another rate increase in their benefits and will have the opportunity to improve the condition of their health. The program should also be designed with the employee survey in mind and the activities and programs that employees said they would be willing to participate in should be incorporated into the program. It is also recommended that after the program is developed that a lawyer who specializes in employee law review all of the program details in order to prevent any potential lawsuits. After a specified time period, an audit of each particular program should done in order to identify which programs are generating successful results, and have the highest participation rates, and Technicraft should then permanently implement those programs. In order to generate continued success in these programs a bonus structure should be developed as an incentive to employees for their continued success in living a healthier life.

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Hess, C. (2010). Exercising options: firms see returns as wellness programs begin to pay off. The Business Journal. Retrieved November 2, 2010, from http://www.bizjournals.com/milwaukee/stories/2010/10/04/story2.html

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APPENDIX
EMPLOYEE SURVEY

Employee Health Survey

The purpose of this survey is to determine if there are any lifestyle habits and health matters that Technicraft, Inc employees could improve upon. The company is investigating possible programs to implement as a way to stabilize health benefit costs to employees as well as a way to help employees lead healthier lives. Rest assured that your answers to this survey will remain completely anonymous. Please help us determine if a wellness program could potentially be of benefit to all Technicraft employees by filling out this survey.

1. Do you currently smoke? ______Yes ______No

2. If you smoke, how long have you smoked? ______0 to 5 Years ______6 to 10 Years ______Over 10 Years

3. Is your blood pressure 140/90 or higher? ______Yes ______No ______Don’t Know

4. How much do you exercise each week outside of your job? ______Less than 1 hour ______1 to 2 hours ______3 to 4 hours ______Over 4 hours

5. What type of exercise do you participate in? ______Walking ______Aerobic classes ______Swimming ______Lifting weights ______Running ______Biking ______None

6. How much time do you spend each week exercising? ______No time ______1 hour ______2 hours ______3 hours ______4 hours

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7. Have you had any of the following medical preventive tests/exams?
______Mammogram (if a women)
______Prostate exam (if a man)
______Lung x-ray
______Electrocardiogram
______Stress test

8. Are you at least 20 percent over your desired weight? ______Yes ______No ______Don’t Know

9. Is your cholesterol over 200? ______Yes ______No ______Don’t Know

10. Do you think you are suffering from stress? ______Yes ______No ______Don’t Know

11. Does anyone in your family have heart disease or has anyone died of heart disease? ______Yes ______No

12. Do you wear your seat belt? ______Part of the time ______All of the time ______Never

13. Do you believe that changes in your life style would improve your health?
______Yes
______No

14. Does anyone in your family have cancer or has anyone died of cancer?
______Yes
______No

Continued on next page

15. Which of the following would you participate in if offered or subsidized by the company? ______Smoking cessation program ______Aerobic exercise classes ______Medical preventive tests/exams ______Diet program ______Immunization programs for tetanus, flu, and/or pneumonia