New study says you can save $100 per employee on healthcare just be doing this

Encourage your employees to make a few healthier lifestyle choices and you'll see almost immediate cost savings says a new study. 

"The bottom line for employers is that if you start to change employee behaviors, you will start seeing health care cost savings very quickly. In fact, an employer can save an average of $100 in health care costs per employee per health risk eliminated in the year of the change, and $105 per risk reduced in the year following the reduction," said said Steven Nyce, senior economist at Towers Watson and lead author of the study.

"But if you don't keep healthy people healthy and employees start accumulating new health risks, you not only negate this savings but stand to add health care costs of $145 per employee per health risk added within just one year."

Specifically, the study authors suggest that employers can benefit from understanding the following key findings:

• The financial implications for prevention may be even greater than for risk reduction. For every health risk added, costs increased by 45 percent above the cost savings that resulted from eliminating a risk. This means that if organizations prevent individuals from adding new health risks over time, their cost savings will be greater than if they focus on eliminating a health risk after it emerges. 

• A long-term solution is better than a quick fix. In this study, a greater immediate savings was realized from reducing health risks for people with chronic conditions than for the average employee.  Cost savings were four times greater for those with chronic conditions compared to those without chronic conditions. The study authors stressed that although there always will be a highest-cost group, an ongoing focus on prevention can benefit the entire population by avoiding chronic disease altogether in some cases or slowing the progression and diminishing the severity of chronic disease. All of these potential outcomes from prevention will improve the company's total health care spend.

The study, "Association Between Changes in Health Risk Status and Changes in Future Health Care Costs: A Multi-employer Study," was published in the November 2012 issue of Journal of Occupational and Environmental Medicine (JOEM) and is available on the JOEM website.


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