Congress Ponders Tax Break for Wellness Programs
The details of the Obama administration’s 2010 revenue proposals, revealed this week, don’t add much to what we already knew — you’re basically looking at a few meager concessions to business, coupled with a ton of new impositions and reporting regulations. Fortunately, though, the President’s program is not the only tax-related action going on in Congress right now. Relieving the gloom a little, a proposal to provide a tax credit to companies that offer wellness programs is gaining traction.
The Healthy Workforce Act, introduced by senators Tom Harkin and John Cornyn together with representatives Earl Blumenauer and Mary Bono Mack, proposes the tax break for companies that offer “effective and comprehensive” health promotion programs, defined as those that “provide components such as health risk assessments; health awareness and behavior change programs; meaningful incentives for program participation; and an employee committee that tailors programs to meet workforce needs,” according to Senator Harkin’s blog.
That’s good news indeed for companies that have such a program in place or are thinking of implementing one, as increasing numbers of organizations are. The big challenge for wellness programs has always been simply to get employees to sign up for them and to see them through to a successful conclusion, but more and more companies are finding that they can greatly improve the chances of success by offering meaningful incentives, as I noted here.
The bill will certainly appeal to the White House, as it casts about for ways to slam the brakes on rising health care costs. One of President Obama’s eight principles for health legislation is that it must “invest in prevention and wellness,” points out this New York Times article.
The return on that investment can be substantial. According to a study cited by the U.S. Workplace Wellness Alliance, companies with worksite health promotion programs achieve an average $3.50-to-$1 savings-to-cost ratio in reduced absenteeism and health care expenditures. Another study cited by the Alliance found an average 26 percent reduction in health costs.
The tax credit, if the bill passes, can only make these already solid ROI numbers even more attractive. And, who knows, perhaps the growing vogue for wellness programs might help to change the unhealthy behavior of the nation’s highest-profile (but somewhat surreptitious) smoker: Barack Obama.
