How to measure employee wellness programs ROI in 2025

Employee wellness programs are an essential workplace benefit. They are the key ingredient for running an organization that equally values productivity and workplace satisfaction.

However, despite the potential benefits, some organizations find themselves dissatisfied with the outcomes of their wellness programs. The effectiveness of such initiatives can be compromised due to various reasons. But with strategic planning, effective communication, and commitment from senior leadership, these challenges can be overcome.

To gauge the impact of an employee wellness program, it is crucial to assess its Return on Investment (ROI). This guide aims to shed light on key metrics organizations should monitor as they implement or refine their wellness programs.

By focusing on these metrics, organizations can gain valuable insights into the success and areas for improvement of their wellness initiatives, ensuring a more comprehensive and informed approach to employee wellbeing.

What are the benefits of an employee wellness program?

Employee wellness programs offer significant benefits to both employees and employers, including the following.

1. Improved employee health

According to the RAND Corporation Workplace Wellness Programs Study, implementing wellness programs can significantly improve employees' overall health and well-being, leading to reduced healthcare expenses.

2. Increased employee engagement and morale

By providing opportunities for employees to participate in wellness activities and initiatives, organizations can foster a positive work environment and boost morale. According to a Gallup study on the relation between employee well-being and workplace productivity, engaged employees are more likely to be productive and committed to their work, ultimately contributing to the overall success of the company.

3. Enhanced productivity and performance

Healthier employees are often more focused, energetic, and productive. According to a study by the American Journal of Health Promotion, wellness programs that promote physical activity, stress management, and work-life balance can improve employees' cognitive function and concentration, leading to better performance at work.

4. Reduced employee turnover

Investing in employee well-being through wellness programs can contribute to higher employee retention rates. According to Harvard Business Review, when employees feel supported and valued by their organization, they are more likely to remain loyal and committed to their jobs, reducing turnover costs for employers.

5. Positive employer branding

Organizations that prioritize employee health and wellness are perceived more favorably by both current and prospective employees. According to an article by SHRM, a strong wellness program can serve as a competitive advantage in attracting top talent and enhancing employer branding in the marketplace.

If you’re looking for ideas to inspire your workplace wellness strategy, check out our comprehensive article on employee wellness programs.

What is the ROI for employee wellness programs?

Measuring the ROI for employee wellness programs involves assessing various factors to determine their effectiveness. Here's a breakdown of key factors to consider:

• Healthcare cost reduction – Measure changes in healthcare costs, including reduced medical claims, hospitalizations, and pharmaceutical expenses. Evaluate the impact of wellness programs on chronic conditions and the associated healthcare expenses.
• Absenteeism and presenteeism – Track absenteeism rates to determine if wellness initiatives decrease employee sick days. Assess presenteeism, where employees are present but not fully productive, by examining factors such as on-the-job performance and engagement.
• Employee productivity – Measure changes in productivity indicators, including task completion rates, project timelines, and overall work output. Consider employee feedback and performance reviews to gauge improvements in work-related outcomes.
• Retention and recruitment – Analyze turnover rates to understand if wellness programs contribute to increased employee retention. Assess the impact of wellness initiatives on recruitment, as a positive workplace culture can attract and retain top talent.
• Employee engagement and satisfaction – Utilize surveys and feedback mechanisms to measure employee satisfaction and engagement levels. Assess if wellness programs contribute to a positive work environment and employee morale.

Employee wellness programs ROI: how to calculate

Calculating the ROI for employee wellness programs involves comparing the financial benefits gained against costs incurred. The formula for ROI is:

ROI =Net Financial BenefitCost of Program 100

Here's a breakdown of the components:

• Net financial benefit: Subtract the total costs associated with the wellness program from the total financial benefits realized. Financial benefits may include healthcare cost savings, reduced absenteeism, and increased productivity.
• Cost of program: Include all expenses related to implementing and maintaining the wellness program. This encompasses program development, incentives, communication, and any other associated costs.
• ROI percentage: Multiply the net financial benefit-to-cost ratio by 100 to express the ROI as a percentage.

For example, Rand Corp estimates that the wellness ROI is $1.50 on average, that is a return of $1.50 for every dollar that the employer invested in the entire wellness program.

VOI vs ROI: which one should you measure your employee wellness programs with?

Return on Investment (ROI) and Value on Investment (VOI) are two distinct metrics used to assess the effectiveness of employee wellness programs.

ROI is a financial metric that measures the ratio of the net financial gain to the costs of an investment. In the context of employee wellness programs, ROI quantifies the monetary benefits gained, such as healthcare cost savings and increased productivity, in relation to the program's costs.

VOI is a broader metric that takes into account both financial and non-financial benefits. While financial gains are considered, VOI also includes qualitative factors like improved employee morale, enhanced workplace culture, and increased job satisfaction. VOI provides a more comprehensive view of the overall value derived from an investment beyond just monetary returns.

Tracking both ROI and VOI is considered the best practice for evaluating employee wellness programs. While ROI provides a clear financial picture and helps justify budget allocations, VOI captures the broader impact on employee well-being and organizational culture.

8 employee wellness metrics you should track

Tracking a comprehensive set of employee wellness metrics is crucial for assessing the effectiveness of wellness programs.

Here are eight key metrics to consider.

1. Utilization rate

A well-designed wellness program is one that employees feel inclined to use. Monitoring the utilization rate in wellness programs is crucial for assessing employee engagement. High utilization indicates that employees are actively involved in well-being activities, showcasing a positive response to the initiatives offered by the organization.

Forma provides a single platform for managing wellness programs and other types of flexible benefits plans. Maintaining a single source for benefits leads to a higher utilization rate compared to traditional point solutions, reaching 80% in most cases compared to employers who offer disparate programs and see 20% utilization rates. To learn more about the ROI and high utilization rates of Lifestyle Spending Accounts (LSAs), download our flexible benefits ROI whitepaper.

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2. Health Risk Assessments 

Conducting regular Health Risk Assessments involves evaluating employees' overall health status, often including measurements such as blood pressure, cholesterol levels, and lifestyle assessments.

HRAs provide a baseline understanding of potential health risks and help tailor wellness programs to address specific employee needs.

3. Absenteeism rates

Tracking absenteeism rates provides insights into the impact of wellness programs on employees' attendance. A decrease in absenteeism suggests that the initiatives are contributing to improved overall health and well-being, leading to fewer days missed due to illness.

4. Presenteeism levels

Assessing presenteeism, where employees are present but not fully productive due to health issues, offers insights into the program's impact on day-to-day performance. Surveys or performance evaluations can be used to gauge employees' ability to work at full capacity.

5. Employee satisfaction surveys

Implementing employee satisfaction surveys specific to wellness programs helps gather feedback on program content, accessibility, and overall satisfaction. This information is valuable for refining and enhancing wellness initiatives based on employees' preferences and needs.

6. Biometric measurements

Including biometric measurements such as BMI, body fat percentage, and fitness levels provides a more detailed understanding of employees' physical health. Monitoring these metrics over time helps assess the effectiveness of wellness programs in promoting healthier lifestyles.

7. Healthcare cost trends

Analyzing trends in healthcare costs, including insurance claims and medical expenses, is essential for assessing the financial impact of wellness programs. A decrease in healthcare costs may indicate that preventive measures and healthier behaviors are positively influencing overall health.

8. Workplace productivity metrics

Evaluating workplace productivity metrics, such as task completion rates and project timelines, allows organizations to connect wellness programs with employees' cognitive function and job performance. Positive correlations indicate that well-being initiatives contribute to enhanced workplace productivity.

What are the different kinds of employee wellbeing?

Employee well-being encompasses various dimensions that contribute to an individual's overall health, satisfaction, and performance at work.

Here are different aspects that make up an employee's well-being.

1. Career well-being

Career well-being centers on job satisfaction, engagement, and work-life balance. Providing opportunities for career development, recognizing achievements, and ensuring a healthy work environment contribute to occupational wellbeing. Flexible work arrangements and professional development opportunities enhance employees' overall job satisfaction.

Forma’s Lifestyle Spending Accounts (LSAs) are a great way to improve employee career well-being in a cost-efficient way. By incentivizing employees to set aside pre-tax dollars for wellness activities that matter to them, Forma helps organizations foster a culture of wellness, self-care, and self-improvement.

Find an employee benefits package that encourages career growth<span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">schedule a consultation</span> with one of our experts and find out how Forma can help you and your workforce improve.

2. Physical well-being

Physical well-being encompasses the health and fitness of employees. This includes maintaining a healthy lifestyle, managing stress, exercising regularly, and addressing physical health concerns. Organizations can promote physical well-being through wellness programs, health screenings, and initiatives encouraging a healthy work-life balance.

3. Mental and emotional well-being

Mental and emotional well-being focuses on the psychological health of employees. It involves promoting mental resilience, stress management, and creating a supportive workplace culture. Employee assistance programs, stress reduction workshops, and mental health resources foster a positive emotional environment.

4. Social well-being

Social well-being emphasizes the importance of positive relationships at work. Building a sense of community, encouraging teamwork, and fostering a supportive workplace culture contribute to social well-being. Social events, team-building activities, and open communication channels are vital for creating a positive social environment.

5. Financial well-being

Financial well-being relates to employees' financial stability and security. Organizations can support financial well-being through fair compensation, financial education programs, and benefits that address employees' financial needs. This includes considerations for retirement planning, healthcare coverage, and other financial perks.

6. Intellectual well-being

Intellectual well-being involves the stimulation of employees' minds through continuous learning and skill development. Organizations can support intellectual well-being by offering training programs, workshops, and opportunities for career advancement. A culture that values innovation and continuous improvement also contributes to intellectual well-being.

7. Environmental well-being

Environmental well-being focuses on creating a safe, healthy, and sustainable workplace. This includes ensuring a physically safe environment, promoting eco-friendly practices, and fostering a culture of respect and inclusivity. Environmental well-being contributes to a healthier workplace culture.

8. Community well-being

Community wellbeing extends beyond the workplace to the broader community. Encouraging employees to engage in community service, corporate social responsibility initiatives, and volunteering fosters a sense of purpose and community well-being. Organizations can contribute to social causes, aligning their values with community wellbeing.

9. Cultural well-being

Cultural well-being emphasizes a workplace culture that values diversity, equity, and inclusion. Creating an inclusive environment where employees feel a sense of belonging contributes to cultural well-being. Organizations can achieve this through diversity training, equal opportunity practices, recognizing cultural holidays, and promoting a culture of respect.

10. Spiritual well-being

Spiritual well-being involves finding meaning, purpose, and alignment with personal values in the workplace. Encouraging employees to connect with their sense of purpose, providing opportunities for personal growth, and fostering a culture that respects individual beliefs contribute to spiritual well-being.

Improve your employee wellness programs ROI with Forma

The challenge of measuring ROI for employee wellness programs underscores the need for a comprehensive approach to evaluate the success of these initiatives. 

Throughout this article, we delved into the intricacies of tracking wellness ROI by emphasizing key metrics such as utilization rate, workplace productivity, and others. By considering these diverse indicators, organizations can obtain a holistic understanding of the impact of their wellness programs.

Forma’s approach to wellness ROI is to tackle the primary issue – low utilization rates for wellness programs. To address the problem, Forma’s benefits platform focuses on providing a streamlined user experience, efficient management tools, and comprehensive analytics. The results speak for themselves – organizations that use Forma have reached 80% and more utilization rates, a difficult benchmark to beat for most benefits platforms.

To explore Forma features, including its powerful ROI tracking tools, check out the live product demo.

Start measuring your employee wellness programs ROI with ease by<span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">scheduling a consultation</span> with one of our experts.