Firms Could Get U.S. Tax Breaks by Offering Wellness Benefits
Senate Appropriations Labor-Health-Education Subcommittee Chair Tom Harkin (D-Iowa) and Sen. Gordon Smith (R-Ore.), a member of the Senate Finance Committee, on Monday introduced legislation that would provide a tax credit to businesses that offer wellness programs for their employees, CQ Today reports (Teitelbaum, CQ Today, 7/9).
The legislation would provide businesses a tax credit "worth 50% of the costs they incur per employee for wellness and preventive health care services," CongressDaily reports. Companies would receive a tax credit of up to $200 for the first 200 employees participating in a wellness program and up to $100 per employee thereafter (CongressDaily, 7/9).
To qualify for the program, businesses would have to provide programs that meet at least three of four criteria, including: events to raise awareness and screen for health risks; seminars to boost behavioral change; incentives for participants; and a committee to oversee the wellness program (Shellnutt, Bloomberg/Houston Chronicle, 7/9).
Businesses that offer wellness programs would be eligible for the credit for up to 10 years under the legislation.
Harkin and Smith said the cost of the legislation has not yet been calculated. However, Harkin said that typically, every dollar spent on wellness and prevention programs over one year to 18 months saves $3 to $4 in health care costs. Harkin said that he hopes to attach the measure to tax legislation that likely will be considered in the fall.
The American Medical Association, American Lung Association, American Cancer Society and the U.S. Chamber of Commerce support the legislation, among other groups (CQ Today, 7/9).
In related news, the Washington Post on Tuesday examined how many companies are instituting wellness programs to encourage a happy, healthy and more productive staff.
Matthew Grawitch, interim director of the Organizational Studies Program at St. Louis University, over 15 years reviewed literature from the fields of psychology, business, medicine, public health, sociology and economics and found a link between job satisfaction and lower absenteeism, lower turnover and higher performance.
The review also found that workplaces with employee involvement programs demonstrate a 2% to 5% increase in productivity and that those with health promotion programs save an average of $3.50 for every dollar spent, as measured by reduced absenteeism and health care costs. Workplaces with wellness programs also report fewer work-related injuries and lower stress levels.
Grawitch said that aside from the physical health benefits, wellness programs, such as smoking cessation or weight-loss programs, also show employees that a company cares about their well-being (Baker, Washington Post, 7/10).