THE BLOG

It's Official: Employee Wellness Is a "Scam"

04/17/2015 04:39 pm ET | Updated Jun 17, 2015

No Affordable Care Act (ACA) provision enjoys more bipartisan support than the provision encouraging employers to pay or fine employees based on their health and health behaviors, a practice known as "workplace wellness." Both the House and the Senate are likely to pass the Preserving Employee Wellness Programs Act and the President is likely to sign it.

It appears that neither the President nor Congress seem to have access to the internet, because for all its support and corporate popularity (most large companies now require employees to participate or else forfeit hundreds of dollars), wellness is generally agreed to be the worst idea in the ACA. Wellness damages employee morale and increases the cost of insurance.

And that's not according to opponents. That's according to its promoters -- the two official trade associations, Health Enhancement Research Organization (HERO) and the Population Health Alliance (PHA). These two leading wellness advocacy groups convened a joint committee of 39 self-described "subject matter experts" from 27 wellness vendors and health plans, which produced a free, downloadable, 88-page tome ostensibly to justify wellness.

Yet despite its pro-wellness agenda, this expert report admits wellness harms both employee morale and corporate reputations. The report categorizes these two concerns as "tangential costs" of wellness. As a former CEO of a NASDAQ company, I disagree with that assessment. My shareholders would have demanded a major financial benefit to even slightly jeopardize those assets.

Alas, the report claims no financial benefit, major or otherwise. It optimistically lists wellness's gross annual savings as about $12 per employee ("optimistically" because US government data shows that the 23 percent reduction in heart attacks and related admissions they attribute to their wellness program happened to match the 23 percent reduction in heart attacks that took place everywhere over the same multi-year period). In other words, most major corporations are subjecting millions of employees to demeaning weigh-ins and uncomfortable (plus, often inaccurate or misinterpreted) blood draws...all to save the price of lunch.

And that's before counting costs. The report optimistically pegs costs at $18 per employee ("optimistically" because page 10 of the report itself lists 11 other costs besides program fees -- and the $18 includes only program fees).

There are four reasons this report's candid comparison of costs and savings was probably unintentional. First, these two figures appeared on different pages (15 and 23) without referencing each other.

Second this report is chock full of disinformation in support of wellness, including a statement for which these 39 "experts" spurned a million-dollar reward they could have collected by demonstrating that they knew how to apply fifth-grade math to a simple word problem.

Third, this is not exactly an industry known for its integrity: promoters of the ironically named C. Everett Koop Award almost always bestow it upon customers of its own sponsors and/or their own committee members, regardless of merit. In one case, the award-winning sponsor of the Nebraska state employee program admitted lying about saving the lives of cancer victims who it turns out never had cancer in the first place. Technically that's fraud in a state contract, but the leader of the Koop Award committee called it a "best practice." Twice.

Fourth, this is an industry prone to gaffes. They Said What? lists forty-five vendors who apparently can't add or subtract, can't construct a coherent sentence and in one case didn't even spell the name of its founder correctly -- unless, that is, it really was founded by the inventor of the all-you-can-eat self-serve restaurant, Warren Buffet.

Speaking of gaffes, this is the second time recently that wellness industry promoters have accidentally admitted wellness loses money. In July, the unabashedly named American Journal of Health Promotion allowed, almost parenthetically, that "randomized controlled trials [of wellness] show negative returns."

If wellness promoters keep writing that wellness loses money, at some point we have to believe them.

Perhaps the negative impacts on morale, corporate reputation and finances could be justified if there were employee health benefits. Yet wellness can actually be hazardous to employee health. The popular practice of attaching money to weight loss incentivizes bingeing before the first weigh-in and crash-dieting before the last one, neither of which is healthy. Wellness vendors market many screens the official United States Preventive Services Task Force (USPSTF) recommends avoiding. Health advice - including eating less cholesterol and more whole grains, buckling seat belts without a mention of texting while driving and getting prostate and thyroid tests -- is irrelevant, outdated, controversial or wrong. One company, Aetna, actively encourages employers to put obese employees on drugs that the Journal of the American Medical Association has published editorials against due to their hazardous side effects.

Because the wellness industry leaders now agree that wellness is a bad idea, opposing arguments are superfluous, though it is worth noting that the opposition is also bipartisan. The right-wing Federalist has railed against it, the New York Times' Incidental Economist bloggers have repeatedly pointed out it doesn't work, and a syndicated Los Angeles Times columnist anointed it with the word used in the title above: "scam."

While unfortunate that the single ACA provision garnering bipartisan consensus is badly misguided, the fact that neither party has staked its reputation on the success of wellness should make it easier to back off. A simple regulation that "wellness must do no harm" (as measured by the USPSTF) should encourage most employers to replace wellness done to employees (via medicalizing the workplace) with wellness done for employees (via subsidized gym memberships, health education and healthy cafeteria offerings).

Now there's an idea that deserves bipartisan consensus.