ROI of Mental Health Benefits

Updated December 2022


Purpose of this Template

Introduction

Background on topic

Laws & Regulations

Best practices for implementation

Communication

Resources

Related Blog Posts, Lunch & Learns, Workshops, and Coaching

Contributors to this Template

        


Purpose of this Template

This template has two purposes: to capture data on the business reason to invest in employee’s mental wellness and to guide HR professionals on best practices in implementing employee wellness benefits and programs.

Introduction

We all know that keeping employees healthy is good for the employee and also good for business. However, including mental wellness into the equation is a newer concept that often gets ignored. Ignoring your employees’ mental health is not only hard-nosed, it’s actually costing employers. Research on the return on investment (ROI) of employee mental health programs shows that supporting employee wellness is a valuable investment.

Background on topic

The COVID-19 pandemic has exacerbated mental health concerns of employees and highlighted the impact of psychological distress on the economy. According to the World Health Organization, depression and anxiety alone costs the global economy $1 trillion USD each year. This is largely due to reduced productivity. In fact, the WHO notes that 12 billion working days are lost every year to mental health concerns. The cost of mental distress on the employee and employer is significant. Even though some levels of workplace stress are unavoidable, research shows employers can improve employee wellness with the right programs. For example, The National Safety Council at the University of Chicago found that employers who offered robust mental health benefits saw a return of $4 for every dollar invested in mental health treatment. A meta-analysis by Chapman et al. in 2012 found that participants in workplace health promotion programs had about 25% lower medical and absenteeism expenditures than non-participants. The Center for Workplace Mental Health, a program of the American Psychiatric Association, found that more than 80% of employees treated for mental illness report improved levels of work efficiency and satisfaction. Investing in employee wellness has shown to increase productivity, improve performance, reduce healthcare costs, and encourage retention (Bondar et al, 2022). Championing mental wellness also has qualitative benefits including attracting new talent, reducing the mental health stigma and increasing trust. The science is clear: investing in employee mental wellness is good for business and employees alike.

Laws & Regulations

In creating workplace wellness benefits and programs, employers must consider the various legal requirements imposed by the Americans with Disabilities Act

(ADA), Health Insurance Portability and Accountability Act (HIPAA), and the

Affordable Care Act (ACA). Generally, workplace wellness benefits and programs must be voluntary, non-discriminatory, be reasonably likely to promote health or prevent disease, and protect the confidential health information of their employees.

Best practices for implementation

Every workplace is unique, so we recommend a data-driven approach to developing your company’s workplace benefits and wellness programs.

Step 1:  Establish support from top leaders 

Even though the study of workplace mental health and data on ROI has long been accepted, championing mental wellness can still feel superfluous to leaders due to the mental health stigma. We recommend presenting the information from the previous section (as well as any reputable resources you’ve found) to top company leaders. This will help to bring them up to speed on the science of workplace wellness, provide rationale for expanding mental health programs and benefits and to ultimately gain their support.

Step 2: Collect data

We recommend administering a voluntary anonymous Wellness Survey to all employees and leaders to capture needs and identify specific pain-points. The survey can be standalone or be part of your company’s regular pulse survey. Either way, we recommend asking questions such as:

On a scale from 1-5:

Qualitative question examples:

These questions will help in identifying barriers and recommendations, and also act as a benchmark to compare progress.

Step 3: Implement recommendations

After you’ve collected and analyzed the data (this can be a project of the Human Resources team, a cross-functional collaboration, or 3rd party contract), you are better suited in making recommendations that work for your organization. We recommend picking 1-3 programs to implement within a set amount of time. Some program ideas include:

        

Step 4: Evaluate success

After your program(s) have been implemented within the set amount of time, you can now evaluate success. We recommend evaluating success by administering the wellness survey in Step 2 and comparing results. You can also look at company data on absenteeism, turnover rates, sick days used, and job satisfaction to track success. It’s important to continually monitor program success and update benefits to ensure continued efficacy.

Communication

We recommend regular communication to all employees outlining all wellness benefits with clear instructions on how to access them. Additionally, designating a point-person to respond to any questions, comments or concerns related to wellness benefits is a useful way to ensure equitable access and hear feedback.

Resources

Related Blog Posts, Lunch & Learns, Workshops, and Coaching

Contributors to this Template


        

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OPHR: One Person Human Resources