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Toolkit: Designing and Managing Effective Wellness Programs

Strengthen your benefits strategy with insights on designing, managing, and evaluating effective and compliant workplace wellness programs to boost employee engagement and reduce health care costs.


As health care costs continue to increase, employers and employees are searching for ways to keep these costs under control and manageable. Preventive health and wellness benefits are designed to help maintain or improve employees' behavior to achieve better health and reduce disease risks. By avoiding costly health problems and lowering their incidence among employees, organizations hope to save on long-term health spending. Wellness programs are also integral to employees' overall well-being.

By offering employees the means and the educational tools to take control of their health, employers can promote a healthier, more productive work environment. A well-executed  wellness program can help reduce health care costs, improve productivity, and increase employee retention, affirming the correlation between personal health and job satisfaction.

Table of Contents

  1. Common Wellness Programs
  2. Integrating Digital Tools
  3. Managing a Wellness Program
  4. Legal Issues and Inclusion
  5. Communications
  6. Metrics
  7. Expert Advice

Mental Health Benefits Are Evolving: How Employers Can Keep Up

Explore the shifting role of mental health benefits in the workplace and new ideas for meeting employee expectations in this All Things Work podcast episode.

Common Wellness Programs

Wellness benefits can take many forms and be as simple or complex as the employer desires.

Some wellness programs help employees prevent or manage chronic conditions, such as obesity, high blood sugar, and elevated cholesterol. Others offer incentives to encourage participation in specific health and wellness activities.

Employers often share preventive health and wellness information through various channels, such as wellness provider online portals, wellness events, and health fairs, to raise awareness and equip employees with tools to live a healthier lifestyle. Examples of wellness initiatives include a 24-hour health care provider line, CPR and first aid training, massage therapy services, onsite nap or wellness rooms, and onsite medical clinics.

Well-Being Programs

Some employers opt to promote overall well-being among employees through a combination of nutrition, physical activity, mental health support, and wellness initiatives. Inclusive programs focus on empowering individuals to make sustainable healthy choices that fit their needs. These programs often do the following:

  • Offer onsite wellness classes through health and fitness providers.
  • Provide discounts for employees to attend offsite wellness or fitness classes.
  • Encourage participation in weight loss programs from universities, hospitals, and other health care organizations.
  • Offer access to coaches, health advocates, and tracking tools through health insurance plans.
  • Share educational resources on healthy habits through insurance provider websites.
  • Partner with vendors to offer programs that enable employees to work with coaches to address lifestyle support.
  • Sponsor fitness/movement campaigns such as step challenges or other activity-based initiatives.

Other Popular Employer-Sponsored Wellness Activities

Employer-supported vaccine clinics may make it more convenient for employees to get vaccinated, help boost vaccination rates, and reduce the spread of infectious diseases in the workplace.  

Nutrition programs may focus on specific conditions such as obesity, or promote healthier lifestyle choices, such as reducing salt and carbohydrate intake. Large organizations might introduce nutritious cafeteria menus, while smaller companies can provide healthy food options at meetings.

Low-impact exercise programs, such as walking groups, can be scheduled before or after work or during breaks or mealtimes. These low- or no-cost initiatives can also be tracked through various apps.

Though in-house fitness centers can be an excellent employee benefit, employers should be aware of their potential costs, including for the facility, equipment, and staff. There are also potential liabilities, and those providing an in-house gym should consider requiring a waiver.

Biometric screenings typically measure key health indicators such as blood pressure, cholesterol, glucose, and body composition, while aerobic capacity tests assess overall fitness. An employer’s medical department or external providers can conduct the screenings, and employees can use their results to benchmark their health. Employee perceptions of screenings vary, so employers must balance privacy concerns and legal compliance with any benefits from promoting health screenings.

Health risk assessments help employees better understand and manage their health, but getting them to participate can be challenging. Employers often use incentives such as cash, premium reductions, HSA/FSA contributions, merchandise, or other health care cost reductions, to encourage completion. Mandating assessments for coverage eligibility introduces significant legal risks that must be carefully managed.

Although cigarette smoking among U.S. workers has been declining for decades, using electronic cigarettes, or vaping, is surging in popularity, providing a new set of challenges for employers. As a baseline, employers can promote a smoke-free, vape-free workplace, cultivate a culture that supports wellness through nonjudgmental messaging on health dangers, and encourage health risk appraisals and smoking/vaping cessation counseling from employees' own physicians.

Other options include:

  • Providing access to resources that offer professional coaching and ongoing encouragement to help employees quit.
  • Ensuring coverage for cessation medication and therapies with no out-of-pocket costs.
  • Eliminating employee co-payments for cessation-related expenses and providing other incentives.

Employer-sponsored stress reduction programs can help employees recognize when stress becomes unhealthy, affecting their personal and professional lives, with potentially severe personal and financial costs. Some common programs and practices include:

  • Employee assistance programs (EAPs), which 73% of employers around the world use to address employee stress. 
  • Work/life balance programs and flexible work schedules.
  • Incorporating mindfulness practices into the workplace.
  • Stress management resources, including books, music, and online information.
  • Concierge services.
  • Yoga classes.
  • Onsite nap rooms.

Financial wellness programs typically seek to improve employees' financial literacy by addressing challenges such as creating and maintaining a household budget and taking steps to reduce long-term debt. Other frequently addressed topics include saving for milestone events such as buying a home or funding a college education.

A variety of incentives — such as cash, gift cards, and HSA or FSA contributions — can encourage employee participation in health improvement programs, as can reducing employer health plan contributions for nonparticipation. Health insurance premium reductions are widely considered the most effective incentive and are often tied to activities such as risk assessments, weight loss programs, and not using tobacco. However, wellness incentives must be carefully designed to avoid unintentionally encouraging unhealthy behaviors, such as unsafe weight loss or short-term fitness participation.

SHRM Resources
  • Smoke and Vape-Free Workplace Policy
  • Gym Membership Reimbursement Policy
  • Physical/Medical Examination Policy
  • Fitness Center Policy
  • Quiz: Understand the Impact of Chronic Health Conditions
  • Vaccination Policy: Voluntary
  • Health Risk Assessments: Benefits and Legal Compliance Tips
  • Can an Employer Implement a No-Smokers Hiring Policy?
Pro Tip

Before implementing a wellness program or initiative, an organization should carefully consider the possible costs, advantages, expected levels of employee participation, and potential legal concerns.

Integrating Digital Tools

Wellness apps or web-based platforms offer many advantages. But offerings and costs vary widely, so employers may want to make digital tools a complementary component of an overall wellness program, not a substitute for traditional offline versions.

Examples of digital wellness initiatives include:

  • An app that offers nutrition education and support for physical activity.
  • An online forum for individuals and groups to set health goals, track progress, and share experiences through bulletin board postings and blogs.
  • Employer-created private teams for a wellness initiative.

More sophisticated options include online health risk assessments, digital health coaching, disease management and support modules, and automated reminders about medication, diet, and exercise. 

The many advantages of online wellness programs include:

  • Scalability. Information is readily accessible across multiple sites and for remote employees, and is easy to distribute, collect, and track.
  • Customization. Many web-based wellness programs can populate a report of an employee’s current health issues and recommended goals and action plans based on the results of a health risk assessment.
  • Cost savings. For example, web-based personal coaching can effectively simulate a face-to-face or telephone coaching experience for about one-fifth the cost.
  • Broad appeal. While Generation Z and Millennial workers are accustomed to accessing information and services online, technology-based health interventions, such as digital health coaching, can be a good fit for older generations as well.
  • Robust reporting. Employers can quickly stratify, compare, and contrast aggregate data. They can perform sophisticated data analyses such as tracking a disease management module's effect on participants' key disease markers or identifying a hidden issue that puts many employees at risk.
  • Enhanced privacy. Using a web-based, third-party provider can help alleviate employees' privacy concerns. For this reason, some web-based wellness vendors advise against co-branding wellness sites with employers.

Explore how technology can help foster healthier, more inclusive workplaces with Marjorie Morrison, SHRM’s executive in residence for mental health, in this episode of The AI+HI Project podcast.

SHRM Resources
  • Case Study: Hilton's Data-Driven Approach to Workforce Well-Being
  • What Is a Wellness Program?
  • How to Establish and Design a Wellness Program
Pro Tip

Before partnering with any web-based provider, employers should ask how employee information is protected and verify that the provider's site is HIPAA-compliant.

Managing a Wellness Program

Effectively designed and managed wellness programs need sufficiently high levels of employee participation and engagement to achieve program goals.

Increasing Employee Participation

Using a customized approach can boost participation. Best practices include:

  • Smart communications: With appropriate authorization in place, use data from health risk assessments, claims data, or personal health records (including electronic medical records, if available) to identify participants who have an epidemiological need and are ready for change.
  • Customized promotion: HR should collaborate with program providers to develop a strategic communications plan that aligns with the employer’s brand, workforce demographics, and health priorities.
  • Best-in-class incentives. Offering employees meaningful incentives encourages initial participation and sustained motivation, leading to higher overall participation rates.

Increasing Employee Engagement

Engagement refers to both employees' active involvement and commitment to personal wellness and to the organization's wellness programs. Employers should be aware of various influences and obstacles that affect engagement, such as the following:

  • Family members and other loved ones: They can be strong motivators for healthy change but may also create barriers by impacting the employee’s decisions and actions.
  • Self-empowerment: Employees may lack confidence and need support and encouragement, along with the right tools and resources to take the first step.
  • Trustworthiness of the program: Building employee trust is critical, as a lack of trust can be a major obstacle to participation in workplace health programs.
  • Co-workers: Colleagues can exert a major influence on employees to become involved in worksite programs, and so can senior management if organizational morale is high.
  • Transparency: Employees appreciate clear and concise communications about coverage, cost, choice, and benefits changes.

Adhering to these “rules of engagement” can help employers maximize the return on investment (ROI) from employee wellness program endeavors:

  • Keep it relevant.
  • Make it social.
  • Integrate vendors.
  • Stay positive.
  • Play it safe.

Accomplished HR executive and author April Simpkins offers insights into fostering a workplace culture that supports employee well-being in this Tomorrowist podcast episode.

SHRM Resources
  • The 5 Rules of Engagement for Wellness Programs
  • Health Care Cost Management Strategies: An Essential Toolkit
  • How to Destigmatize Mental Health Care Among Employees
  • Checklist: Build and Maintain a Mental-Health-Friendly Workplace
  • Managing Employee Assistance Programs: A Comprehensive Guide
  • Employee Assistance Program (EAP) Policy Template
  • How to Develop and Sustain Employee Engagement

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Pro Tip

Employees are more likely to engage in activities that are personalized, targeted to their specific needs, and support work/life balance, as opposed to traditional programs that only focus on health risk factors.

Legal Issues and Inclusion

Wellness programs are subject to multiple legal and compliance requirements. 

Several laws govern how these programs can be designed and administered, including: 
  • Americans with Disabilities Act (ADA).
  • Genetic Information Nondiscrimination Act (GINA).
  • Health Insurance Portability and Accountability Act (HIPAA).
  • Affordable Care Act (ACA).

These laws generally prohibit employers from collecting employee health and genetic information. But both laws have an exception that permits the collection of such information as part of an employer wellness plan, as long as an employee provides such information voluntarily. A wellness program is voluntary if employees are neither required to participate nor are penalized for abstaining. Medical information that is collected is kept confidential and stored separately from personnel files.

This law prohibits group health plans from discriminating against individuals based on health-status factors and divides wellness programs into two general categories. In participatory programs, rewards are based only on an employee's involvement, while in health-contingent programs, incentives are attached to outcomes and must follow standards related to nondiscrimination.

The law requires that employees be offered a waiver or a "reasonable alternative standard" to earn a wellness incentive if it is unreasonably difficult for them because of a medical condition or if it is medically inadvisable for them to satisfy a health standard during the incentive period. One way to design a reasonable alternative standard is to combine a points system with a menu of program options personalized to the participant's health needs and to offer the support of a health coach to guide participants through the process.

SHRM Resources
  • 6 Steps to Make Wellness Programs More Inclusive
  • What You Need to Know About the Americans with Disabilities Act
  • Complying with the Affordable Care Act
  • HIPAA Medical Privacy Policy: Basic Requirements
  • Personal Identity Information (PII) Security, Notification, and Confidentiality Policy
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Communications

Compliant, clear, and effective communication plays a vital role in the success of any wellness program. It can help foster a workplace culture where health and well-being are seen as shared values.

Employers can leverage proven marketing and behavior change techniques to support this effort, such as:

  • An attention-generating program rollout event or activation.
  • A wellness program logo and slogans for various components of the program, such as "Every Body Walk Now," "Wellness Wednesday," "Recess," or "Time Out for Tai Chi."
  • Visible endorsement and participation by upper management.
  • Wellness education based on sound research.
  • Use of anecdotal situations to persuade employees.
  • Commitment to the message and the program over several years.
  • Communication that spans a range of media, including in-office messaging platforms, email, printed fliers, and presentations (virtual and in person).
  • Repetition of the message.
  • Varied information to keep the message fresh.

Legal Communication Considerations

Organizations are responsible for informing employees about their protections under HIPAA and the ADA. These laws ensure that any medical information voluntarily provided to HR is kept confidential. As such, employers should consult legal counsel when developing communication for wellness programs to ensure compliance and minimize risk. Key considerations may include:

  • Obtaining informed consent from all employees who choose to participate in the program.
  • Advising employees to consult with health care providers before starting any diet, exercise, or weight-loss program.
  • Including a clear disclosure that employees voluntarily assume the risks of their participation in wellness activities.

Learn how leaders can be role models for workplace well-being and normalize workplace conversations about wellness in this People + Strategy podcast episode.

SHRM Resources
  • How to Foster a Culture of Empathy in the Workplace
  • Managing Organizational Communication
  • AI Prompting Guide for Crafting Employee Communications
  • Managing Employee Surveys

Have a question about wellness communication best practices?

Ask an HR Knowledge Advisor

Metrics

Employers should evaluate not only wellness program participation but also the ROI. 

For example, with a smoking cessation program, tools such as employee surveys, focus groups, interviews, and health risk assessments can indicate how many employees have completed the program.

Some questions to ask in measuring any wellness program’s effectiveness are:

  • Has the number of sick days decreased since the program was launched?
  • Have the number and cost of health insurance claims decreased?
  • Has productivity increased?
  • Has workplace stress been reduced?
  • Has the workforce become less obese?
  • Has the workforce become more physically fit?
  • Has tobacco use among employees gone down?
  • Has the program reduced addiction issues?
  • Have workplace injuries decreased in number and severity?
  • Has employee engagement improved?
  • Has retention improved?

Employers should allow three to five years to realize the true ROI of a wellness program. If there are too many changes too soon, this may harm an employer’s ability to accurately measure the program’s efficacy, and subsequently, its effect on business performance.

SHRM Resources
  • Benchmarking HR Metrics
  • HR Department Monthly Metrics Report
  • Absenteeism Rate Spreadsheet
  • Absenteeism Incident Rate and Percentage of Employees Absent Spreadsheet
  • Workers’ Compensation Spreadsheet
  • Human Capital Return on Investment Spreadsheet

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