Placebo Handout

Overgrown Placebos: Corporate Wellness Programs

Employers love to say that they have a corporate wellness program. But how much actual wellness do these programs bring to employees? Not much, says a new randomized, controlled study published by the National Bureau of Economic Research.

Placebo Wellness

You’ll hear plenty of anecdotal reports. People are sooo much healthier if they participate in a corporate wellness program. “The value is obvious,” says Tom LaFantaine of Optimus.  “Improved employee health, reduced expenditures, and, perhaps, enhanced profits by creating a more productive workforce.”

“It’s about creating something that both management and employees can be enthusiastic about,” says the Columbia Business Times.

Unfortunately, when Professor Damon Jones looked closely at the effectiveness of these programs, he didn’t find much beyond the bubbly enthusiasm of participants. At a large employer, Jones and colleagues set up a model program. They randomly assigned employees to be eligible for the program. Employees who could not join the program formed the control group.

They found no effect on health and health behaviors:

We do not find significant causal effects of treatment on total medical expenditures, health behaviors, employee productivity, or self-reported health status in the first year. Our 95% confidence intervals rule out 78 percent of previous estimates on medical spending and absenteeism.

What they did find was a strong selection effect. People who joined the wellness programs were already healthy. People with health problems stayed out. That’s not surprising. Especially in programs built to reward folks who are healthy. Why sign up to get dinged?

Dividing Up the Workforce

In other words, many wellness programs work to separate the sheep from the goats. The part about making people healthier? Sounds good, but it doesn’t often work that way.

Rewarding people for good health might sound good. But it also means punishing others who are suffering without it. Thankfully, programs with big health-based incentives will be illegal in 2019.

Click here for the study by Jones et al and here for more about it from Marketplace. For more on the multi-billion dollar wellness industry, click here.

Placebo Handout, photograph © Klesta ▲ / flickr

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February 25, 2018

One Response to “Overgrown Placebos: Corporate Wellness Programs”

  1. February 27, 2018 at 1:56 pm, What is "wellness," anyway said:

    Thanks, Ted, for your continued coverage and incisive commentary on this topic.

    I started working at a wellness company as a proponent and left as a skeptic. It pains me to think about how employers could rather spend the money they are plowing into their wellness programs. . .it’s not an insignificant amount per employee, and I wonder what else they could give to their workers if they spent it otherwise. *sigh*