Wellness Culture Linked to Stock Value

John Commins, September 16, 2013

The study comes as a number of high-profile companies, including Walmart, pizza maker Papa John's, Trader Joe's, and Lands' End clothiers' have said they will re-examine business operations and would consider reducing employee hours or dropping healthcare coverage to contend with mandates in the Affordable Care Act.

Study lead author Raymond Fabius, MD, vice chairman of HealthNEXT, says an increasing amount of evidence is suggesting that for every dollar spent on healthcare costs, companies lose about $3 of productivity."So, what we are starting to see is that a lot of this intuitive understanding that we are seeing is now being much more significantly proven by metrics with a financial basis," he says.

Thayer says it's not earth-shattering news that companies that take better care of their employees generally have more productive employees who stay on the job longer, have fewer sick days, and are more productive.

"It is common sense, but it is amazing how many companies have had a hard time finding their way to the fact that a significant impact on their EBITDA [earnings before interest, taxes, depreciation and amortization] would then translate into earnings per share which translates into share price," Thayer says.

"While we're all in agreement that this is intuitive, the list of companies in the Fortune 500 who have made a significant commitment to building a culture of health which is well beyond providing health benefits is very small number. Our research at suggests that it may be as few as 25 out of the Fortune 500."

John Commins

John Commins is a senior editor at HealthLeaders Media.

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