What Do You Lose When an Employee Exits?

An aging workforce and high turnover are causing an HR crisis in senior living.

By Marty Butler

It is no secret that the senior living industry is facing a serious labor shortage across all segments of the workforce. In addition, the healthcare sector has an aging employee base and will soon be faced with one of the largest waves of retirement in history. 

It is projected there will be 535,371 nurses over 60+ years of age by 2020 compared to 373,573 in 2010. While nurses and front-line workers make up the majority of employee shortages, there is also an anticipated departure of senior executives as well. This, coupled with the ever present dilemma of high employee turnover, equates to a major cause of concern for providers across the country.

To address this industry crisis, healthcare C-suites across the country are re-examining benefit plans, schedules, job requirements, support services and environmental changes. One initiative that will enable healthcare organizations to differentiate themselves and retain employees both young and old is a strong, personalized wellness program.

This new effort requires a transformation from the standard wellness program we see in many organizations today, which can sometimes be more broad and organizational than personal. We need to create an experience for employees to help them find what it is that makes them tick and what will get them (and keep them) engaged. 

We need to get personal.

Cost savings are significant

It seems ironic that the very industry whose goal is to promote wellness and quality of life in seniors has been challenged to embrace this ideology within its own organizational culture. 

A 2007 study from Stanford University sought to determine the effect of work-life balance policies on employee retention and profitability. The study confirmed that firms offering a wellness program experienced a 3.3 percent lower turnover rate post-introduction. Using that number, let’s look at the potential financial impact a wellness program can have on an organization. 

According to the Center for American Progress, the cost of turnover for mid-level (e.g. $50,000 salary) is 20 percent, or $10,000. If we factor in the 3.3 percent mentioned previously per 100 employees, there are potential savings of $33,000 per year. 

In another study from Minnesota State University, the impact of wellness programs on turnover was significant. The overall turnover rate for the 10,430 employees involved in this study was 15.5 percent. However, the 4,714 employees who were involved in at least one wellness program intervention was less than 1 percent.

 A wellness program can lead to invaluable return on investment (ROI): 

  • Shows the employer cares about health and well-being of employees
  • Improves employee morale
  • Reduces unscheduled absences and sick leave
  • Contributes positively to employee recruitment and retention
  • Decreases indirect and direct costs associated with turnover
  • Mitigates workers’ compensation claims
  • Reduces employee benefits spending
  • Enhances the image in the community as an innovative employer

Better benefits mean healthier employees

In addition to improving ROI, employees who truly commit and stick with the program can see incredible results. Not only will they be generally happier and healthier, they could experience some life-changing improvements. Some of the initial measurable outcomes could be weight loss, decrease in cholesterol, decrease in tobacco use, and improvements in blood pressure and blood glucose, just to name a few. 

That all sounds nice, but what does this type of wellness program look like? What can you do? Here are five different areas a strong wellness program should address:

1) Organizational culture: Make sure there is an identifiable brand for the program within your corporate culture by generating a quirky theme and including employees in the development and implementation. Create a community around that brand and have it encompass all demographics, cultures and lifestyles. Most importantly, make wellness a fun component of your company by providing incentives and support while highlighting achievements. It does not have to be costly. A high-five or handwritten note goes a long way.

2) Biometric screenings and chronic disease management: Improve the health of your employees and members, and reduce the severity of claims. If you host biometric screenings and incentivize your employees and their spouses to participate, there is a good chance you can impact the severity of future claims. For example, you may identify someone with high cholesterol and partially clogged arteries. That employee/spouse may require a coronary stent, which can be a low-cost procedure as opposed to open-heart surgery if it went undetected.

3) Stress management: Work-related stress can lead to increased absenteeism, high turnover and decreased productivity and performance. Senior living communities can help to manage and reduce work-related stress by establishing an employee recognition program for work performance and finding opportunities for career development, as well as by providing stress management training, on-site meditation rooms and employee assistance programs. Last but not least, look for ways to improve working conditions within your organization.

4) Ergonomically appropriate physical environment: Typically, aches and pains are caused by physical stress due to prolonged and awkward positions, repetitive motions and overuse. Provide helpful tips that promote good posture and correct ergonomics. Share suggestions with your employees to improve their comfort levels and minimize risk of injury.

5) Health education: When communicating about employee benefits and wellness programs, think through who you are actually communicating with. Your workforce could span four different generations, with each age group having its own unique information-processing style. This requires a thoughtful approach to your communications.

Proceed with legal caution

There is a lot you can do to create a holistic and more personalized wellness program. However, it is important to note that company-
sponsored wellness programs must be carefully structured to comply with state and federal law. Common issues that can arise include: reasonable accommodation, nondiscrimination, confidentiality and protection of off-duty conduct. It is essential to enlist a trusted resource who will stay on the front lines to ensure your wellness program is compliant.

The good news is there are plenty of resources out there. This includes your employee benefits broker, who can provide ideas, resources and information on state and federal laws.

The idea of workplace wellness is not new. According to the Wellness Council of America, more than 81 percent of businesses with 50 or more employees have some form of health promotion program to help offset the rising costs of healthcare. Now, the trick is to bring that wellness program to a more holistic and personal level. 

Expressing a commitment to your employees’ health can improve their morale and strengthen retention. Employees who experience these positive changes will often feel more loyalty to the company and be more grateful for the company’s commitment to their health.

It is time to jump on the personalized wellness bandwagon.


Marty Butler is senior vice president and practice leader for Assurance’s senior living and nonprofit divisions. She has held many different roles within the insurance industry, including claim handling, underwriting, accounting, marketing, client services and sales.