Benefits February 11, 2016

Employers Turn to Another Metric for Wellness Programs

Return on investment is just part of the story for measuring the success of a wellness program. 

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When it comes to measuring wellness program success, employers are using measures that calculate value on investment (VOI) as well as return on investment (ROI), according to a new report from the International Foundation of Employee Benefit Plans (IFEBP).

“A Closer Look: Workplace Wellness Outcomes” finds that just over one-quarter of organizations (28%) are measuring wellness program success with traditional ROI. Half are using at least one VOI measure to track success including employee engagement (30%), turnover (22%), absenteeism (18%), productivity (17%) and recruitment/referral rates (13%).

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Wellness programs continue to gain traction, with previous research revealing that the vast majority of executives believe well-being programs can prevent workplace burn-out. More than 80% of employees say they participate in workplace well-being programs to reduce their stress levels.   

IFEBP’s report compares organizations achieving positive wellness VOI with the average organization offering wellness initiatives. In general, the report finds organizations with positive wellness VOI offer a wider range of wellness offerings than other organizations. Positive VOI offerings include fitness and nutrition initiatives, screening and treatment programs, social and community events, stress and mental health offerings, and purpose and growth initiatives.

Positive VOI wellness programs are also likelier to use a range of wellness communication channels including seminars, speakers, testimonials, books, brochures, health fairs and social media.

NEXT: A strong VOI and holistic approach go hand in hand

Employers that report a strong VOI take a more holistic approach to wellness, according to Julie Stich, research director at the International Foundation. “Beyond traditional wellness initiatives, they are offering options like stress-management programs, staff outings, charity drives and flexible work hours,” Stich says.

Incentives continue to be popular for increasing participation in wellness initiatives, and the report finds they appear to be successful. Participation is especially boosted by offering incentives for health screenings (57% vs. 40%), weight-loss programs (37% vs. 17%) and health fairs (54% vs. 37%). Other factors that successfully increase participation are targeting programs based on employee health risks, surveying workers for feedback on initiatives, including spouses and children in offerings and having company leaders communicate wellness program support.

As well as boosting participation, three factors—a greater level of wellness communication, a willingness to seek worker input and an effort to include families—are shared themes across organizations with positive ROI, VOI and great workplace cultures.

“Wellness programs are not one size fits all,” Stich says. “Before launching or expanding a wellness initiative, employers should determine what their goals are and what programs are a good fit for their unique workplace culture.”

“A Closer Look: Workplace Wellness Outcomes” breaks down the various types of wellness program designs offered and outcomes experienced by organizations to reveal ideas for success. The report uses data from 372 U.S. organizations of a variety of sizes, industries and regions across the U.S. that participated in the 2015 Workplace Wellness Trends Survey.  

Compliance February 11, 2016

Proposed Guidance Issued for Multiemployer Plan Suspension of Benefits

The IRS proposal would provide guidance about any employer that has withdrawn from the plan and entered into a “make-whole” agreement to provide participant benefits.
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The Internal Revenue Service (IRS) has revealed new proposed guidance impacting multiemployer plans, “Additional Limitation on Suspension of Benefits Applicable to Certain Pension Plans Under the Multiemployer Pension Reform Act of 2014.”

The guidance explains that the Multiemployer Pension Reform Act (MPRA) relates to multiemployer defined benefit pension plans that are projected to have insufficient funds, within a specified timeframe, to pay the full plan benefits to which individuals will be entitled (referred to as plans in ‘‘critical and declining status’’). Under MPRA, the sponsor of such a plan is permitted to reduce the pension benefits payable to plan participants and beneficiaries if certain conditions and limitations are satisfied (referred to in MPRA as a ‘‘suspension of benefits’’).

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One specific limitation governs the application of a suspension of benefits under any plan that includes benefits directly attributable to a participant’s service with any employer that has withdrawn from the plan in a complete withdrawal, paid its full withdrawal liability, and, pursuant to a collective bargaining agreement, assumed liability for providing benefits to participants and beneficiaries equal to any benefits for such participants and beneficiaries reduced as a result of the financial status of the plan.

This IRS proposed regulations provide guidance relating to this specific limitation. The regulations would affect active, retired, and deferred vested participants and beneficiaries under any such multiemployer plan in critical and declining status, as well as employers contributing to, and sponsors and administrators of, those plans.

Text of the proposal is here. Comments are due by March 15.

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