Facing steep increases in annual health care costs, livestock feed manufacturer Ralco Nutrition invests in health and wellness programs to help shape up its employees and its budget.
Like many companies, livestock feed manufacturer Ralco Nutrition had shouldered double-digit increases in its annual health care premiums for years. But when the Marshall business's health care costs continued to climb between 12 and 17 percent each year, it turned to a health
benefits consultant for help.
Jon Knochenmus, president of Ralco Nutrition, says a lack of control over rising health care costs led the company to invest in expert advice. "In every part of business you monitor risk," he says. "With health care, we really have not had that [in the past]. As you
actually understand what your [health] risks are ... it just gives you an opportunity to manage your health care, because now you've actually got some statistics and some numbers to evaluate your company's health status."
Pam Armstrong, a health benefits advisor from Health Benefits Design Group in California, explained to company leaders that 50 to 70 percent of health care costs can be controlled with healthy lifestyle changes. To help Ralco Nutrition workers make those changes, the company
partnered with Armstrong to develop a culture of health and wellness.
Ralco Nutrition gradually introduced health and wellness in the workplace. In 2008, employees were paid $200 to take an online health risk assessment asking questions about nutrition, exercise, health conditions and lifestyle habits. While Ralco Nutrition is not allowed to
know the health status of individual employees, the collective survey results--managed by another company--provided a "health score" or baseline metric from which the company can track progress.
Last year, each employee was asked to get an annual physical from his or her personal physician. The company switched from a $500 to a $1,300 deductible and began offering Health Savings Accounts (HSAs). In addition, employees were invited to participate in an eight-week
walking program. Walkers competed for the most steps taken, and as an incentive, all participants received money in their HSAs.
The excitement generated by the walking program was apparent immediately, says Shelly Gniffke, who works in human resources. "We all wore pedometers, and it was really fun the way everybody participated," she says. "By noon, everyone was comparing how many steps they had
for the day."
Now in its third year, the company's focus on health is in full swing. Multiple fitness challenges--including the walking program and "Weight Loss By Eight," a challenge to lose a pound per week for eight weeks-- give workers opportunities to receive money in their HSAs and
to stay motivated. Healthy snacks such as granola and fresh fruit have replaced the company's weekly doughnut day, and new water coolers dot the facility.
Employees who are concerned about their health risk assessments are paired with personal wellness coaches to help them overcome a variety of lifestyle-oriented health issues. "[Employees] develop a relationship with a single coach," Gniffke says. "They get to talk to the
same coach all year long, and they can start to monitor their diabetes or high blood pressure or weight."
For those willing to quit smoking, Ralco Nutrition offers to pay for the first few months of a smoking cessation aid. As of press time, three employees were working to kick the habit.
Ralco Nutrition's healthy culture is rewarding for both employees and the company. Because it has a healthier work force, the company's annual $5,000 budget for wellness campaigns is paid for by savings in health care costs. In addition, the company's annual premium increases
have begun to decrease thanks to a new insurance company, Gniffke says. "We were facing a 21.6 percent increase this last year," she says. "So we actually went shopping for a company that would recognize what we're doing. They looked at us as a lower risk, so we were able to
reduce our increase by about five percent."
In the future, Gniffke anticipates the company's efforts will drive annual increases down to about ten percent. Seeing workers embrace their company's new culture has been equally rewarding.
"It's exciting to hear our employees excited about what we're doing," Gniffke says. "I can't even tell you how many people have asked me when the walking program is going to start. [Health] is a hot topic, and they're hearing it everywhere. People are almost expecting it
from their companies. People want to get healthier, I think, and we've seen really good participation and excitement."