Johnson and Johnson's Health and Wellness Program


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Case Details:

Case Code : HROB025
Case Length : 14 Pages
Period : 1998 - 2001
Pub Date : 2001
Teaching Note :Not Available
Organization : Johnson and Johnson's
Industry : Consumer Goods
Countries : USA

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Introduction Contd...

Moreover, within two years of implementing HWP, J&J witnessed a decline of 15% in employee absenteeism rate. Peter Soderberg, President, J&J explained the rationale behind implementing the program7, "Our research time and time again confirms the benefits of healthier, fitter employees. They have fewer and lower long-term medical claims, they are absent less, their disability costs are lower and their perceived personal productivity and job/life satisfaction levels are higher." Ron Z. Goetzel (Goetzel), Vice-President, Consulting and Applied Research, MEDSTAT Group8 added, "There's a growing body of data indicating that corporate wellness programs lower medical costs for employees."9

Background Note

The US industry spent approximately $200 bn per annum on employee health insurance claims, on-site accidents, burn-out and absenteeism, lower productivity and decreased employee morale due to health problems.

Moreover, according to the estimates of Mercer10, the US industry expenditure on the medical and disability bills of employees was rising significantly. In 1998, companies had paid an estimated $4000 per annum per employee as healthcare costs, and that rose to $5,162 in 2001 and around $5,700 in 2002. Apart from other health related problems (Refer Table I), stress at workplace was considered to be one of the main reasons for this high expenditure. Work stress led to problems like nervousness, tension, anxiety, loss of patience, inefficiency in work and even chronic diseases like cardiac arrest and hypertension. As a result of these health problems, absenteeism increased and productivity of employees declined.

Excerpts >>


7] In an article titled "Fitness in the Workplace," posted on the website www.2-fit.com.

8] A health care research firm based in Ann Arbor, Michigan, US. It specializes in providing knowledge-based systems, decision support systems, market intelligence, consulting and research information for enhancing the quality and value of healthcare.

9] In an article titled "Wellness programs help companies save on health costs" by Julie A. Jacob, dated March 11, 2002 in AM News.

10] Mercer is a human resources consulting company that provides consulting services in areas such as compensation, employee benefits, communication, HR, human capital strategy, investment and program administration. Its operations are spread across 40 countries and 140 cities, with over 13,000 employees.

 

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