Wellness and Mental Health

How to Develop an Effective Wellness Program Budget?

Uncover the importance of a well-planned and thoughtfully allocated wellness program budget that meets your organization’s needs.
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Expert Contributors:
Neepa Patel

Neepa Patel

CEO of WellRight

Good health goes hand-in-hand with good business, and a healthy workforce is also a productive one. That’s why businesses are increasingly investing in employee wellness programs. In fact, the average budget for employee wellness programs grew by 22% from 2020 to 2021, from $4.9 million to $6 million. 

Employee wellness programs are increasingly important as businesses look for ways to improve workplace productivity, reduce healthcare costs, and foster a positive organizational culture. 

But how much should you budget for employee benefits 

The answer depends on several factors, including the size and scope of your program, the target population, and the goals you want to achieve.  

However, there are a few general guidelines that can help you get started. 

This article will provide an overview of the budgeting process for employee wellness programs. We discuss the importance of a well-planned and thoughtfully allocated wellness program budget, and we will give some tips for developing a budget that meets your organization’s specific needs.

Understanding the Benefits of a Well-Funded Wellness Program

The business world is heavily focused on instantly measuring the return on investment (ROI) for every dollar spent. However, this practice often poses challenges when it comes to justifying the costs associated with corporate wellness programs.  

While investing in employee well-being today can lead to reduced healthcare expenses in the long run, these benefits may extend beyond the timeframe captured in an annual report, making it difficult for many businesses to fully appreciate the financial impact.  

In fact, according to Neepa Patel, the CEO of WellRight

“Organizations who intentionally prioritize personalized well-being not only position themselves to hit goals, maximize output, and achieve outcomes. They also lay the foundation for helping employees recognize stressors, develop healthier habits, and own their unique paths to well-being.”
Neepa Patel
CEO of WellRight

There is a growing body of evidence that suggests that well-funded wellness programs can have a significant impact on employee health and well-being, which can lead to many positive outcomes for businesses, including: 

  • Improved Employee Engagement: A study by the Mayo Clinic found that employees who participated in wellness programs were 18% more likely to be engaged in their work. 
  • Reduced Absenteeism: Studies show that for every dollar spent on wellness initiatives, absentee day costs decrease by approximately $2.73. 
  • Increased Retention Rates: One study revealed that 45% of small-to-medium sized company employees would stay with their employer longer because of their wellness programs. 
  • Enhanced Overall Employee Well-Being: Harvard Business Review study found that 57% of employees who participated in a well-being program went from being high-risk to low-risk upon completing the program.  
  • Decreased Healthcare ExpensesFindings indicate that significant positive returns can be observed among large employers who implement wellness programs, even within the initial years of adoption. They discovered that for every dollar spent on wellness programs, medical costs decrease by approximately $3.27.  

Undoubtedly, the benefits of corporate wellness programs extend well beyond the immediate financial impact.

Workplace Wellness Assessment

Healthcare costs are rising, while employee well-being in the United States is at an all-time low.  

Reputable authorities like Gallup and the CDC have highlighted the consequences of low employee well-being on both physical and mental health, which is eroding profits through lower employee engagement, higher turnover, poorer customer service, and higher healthcare costs. 

Addressing this issue is a high priority, but it is essential to understand the problem’s root cause, the different stakeholders involved, and the potential solutions that have already been tried before working on any solution.

There are a few key steps involved in conducting a workplace wellness assessment: 

  1. Assess the work environment: Begin by touring your workplace and conducting a comprehensive environmental assessment. Pay close attention to the available facilities and their impact on staff well-being, including factors such as access to healthy food, opportunities for physical activity, and workplace health and safety.  
  2. Measure the engagement levels: Every organization is unique, so how an employer engages his employees will look different, too. Measure employee engagement levels to build trust, identify strengths and problem areas, and understand how to engage your employees in a way that works best for the organization. 
  3. Choose the right tools: Various data-driven tools are available to help you conduct a wellness at-work assessment. You can choose from surveys, focus groups, interviews, and other methods. 
  4. Develop a survey: If you choose to use a survey, be sure to develop one that is specific to your organization’s needs. The survey should ask questions about employees’ health habits, their attitudes towards wellness, and their suggestions for improving the workplace wellness program. 
  5. Gather data: Once you have developed a survey, you need to gather data from your employees. You can do this by distributing the survey online, through email, or in person. 
  6. Analyze the data: Once you have gathered data, you need to analyze it to identify trends and patterns. This will help you to create a program objective with the goals and desired outcomes of the wellness program.  
  7. Develop a wellness program: Once you have analyzed the data, you can develop a wellness program tailored to your employees’ specific needs. The program should include various activities and resources that will help employees improve their health and well-being. 

In order to design and implement an effective wellness program, managers need to consider holistic approach to corporate wellness offerings. Optimal personal wellness entails achieving a balance across dimensions of wellness, with each area being acknowledged and nurtured.

How to Create a Successful Wellness Program That Fits Your Budget?

You might be wondering, how much do benefits cost per employee?  

The average worker costs about $238 for employee wellness programs. However, different surveys found that the total cost of wellness programs per employee ranges from $150 to $2000.  

Although this is a wide range, there are many ways to create a successful program that fits your wellness program budget. Below are several factors to consider when assessing costs.

The Size & Budget of Your Organization

Typically, the cost of corporate wellness programs increases with the size of your organization. Have you assessed how the expenses will scale as your organization grows?

A well-designed wellness program will require a significant investment upfront.  
However, by allocating funds for program development, implementation, evaluation, and ongoing maintenance, you can ensure your program is successful and sustainable. 

When setting your budget, it’s essential to be realistic about your financial resources and the goals you want to achieve. It’s also important to align your wellness program with the organization’s overall strategic objectives. This will help ensure that your program is aligned with the organization’s priorities and that you’re getting the most out of your investment.

The Scope of Your Program

Corporate wellness program cost will also increase as the scope of your program increases. Decide whether to start with simpler workplace wellness initiatives, such as a free running club, or aim for a more comprehensive approach involving screenings or a custom platform with multiple wellness programs. 

You also need to consider:  

  • Program design: The cost of program design will vary depending on the complexity of your program. 
  • Technology: The cost of technology, such as software and hardware, will vary depending on the type of technology you need. Choose technology solutions that align with your budget. 
  • Vendor fees: If you’re using a vendor to help you find the best wellness companies, you’ll need to factor in the vendor fees. Consider their expertise, pricing models, and compatibility with your program goals. Choose partners who align with your budget and can deliver cost-effective solutions. 

It’s important to know that 74% of companies experiencing a positive return on investment from their wellness programs have a comprehensive healthcare approach that includes health screenings, stress management programs, health risk assessments, and fitness and nutrition programs.

Wellness Providers in the U.S.

Applied Health Analytics
Applied Health Analytics provides strategy leadership, best-in-class technology and go-to-market support that orients provider-centric population health initiatives, direct-to-employer strategies and risk-based contracting.
Employees can set goals around physical, social, and mental health. BetterYou will automatically log each employee's progress to help them stay on track.
BSDI offers a powerful, comprehensive suite of features in a single, integrated platform: Motivation Alliance®. Employees will have a beautiful, mobile-first app in which they can log program and lifestyle-related activities, participate in incentive programs and individual and team challenges.
WellRight's comprehensive platform addresses the six dimensions of well-being: physical, social, emotional, financial, occupational, and purpose. They offer health activities to facilitate positive behavior change, wellness courses to support each employee, and incentive management to lend positive reinforcement toward lasting healthy habits.
YuMuuv is a versatile wellness platform that offers a range of features and programs designed to improve the overall health and wellbeing of employees. The platform provides personalized wellness plans, nutrition guidance, stress management tools, and fitness challenges.
wellness coach
Wellness Coach offers an entire wellbeing platform for preventative care including: 1-1 personal coaching sessions focused on the whole person including stress, anxiety, nutrition, parenting, fitness, and much more.
Navigate provides organizations with the technology and support they need to improve health and happiness, sparking powerful change in their workplaces and communities.
Aduro's comprehensive well-being engagement platform fosters a culture of well-being while elevating individual health and performance, addressing the full spectrum of human needs, including physical, mental, and financial health, social connections, personal growth, and resilience.
Aaptiv is a comprehensive employee fitness and wellness benefit, that provides a range of features designed to help retain, attract, and engage employees through health and fitness.
2Morrow Inc.
An easy-to-use digital health platform that combines behavioral science and technology to provide evidence-based well-being programs via the privacy and convenience of a smartphone.

The Available Resources

Employee engagement is essential to the success of any wellness program.  

If you have limited resources, you may need to be creative in implementing your wellness program.   

How do you plan to effectively advertise and encourage employee participation? What incentives can you provide to motivate engagement? 

When allocating resources within your budget, it’s vital to consider the following costs: 

  • Communication efforts: Allocate resources for communication initiatives to effectively promote and raise awareness about your wellness program. This may include creating educational materials, organizing workshops, or utilizing digital communication channels. 
  • Incentives: Incentives like gift cards or cash rewards contribute to employee engagement. Costs for incentives will vary based on their value and type. Benefits-based incentives, such as discounted insurance premiums, paid time off, or contributions to an HRA or HSA, range from $50 to $200 per employee, considering factors like organization size and criteria for incentivization. 
  • Staffing: Determine the required resources in terms of staff, including wellness program coordinators or dedicated personnel, to oversee the program’s implementation and day-to-day operations. 
  • Equipment and materials: Consider the cost of any necessary equipment, such as fitness equipment or wellness materials, required for the program’s activities. Optimize your budget by selecting cost-effective options. 

By allocating resources for employee engagement initiatives, you can motivate your employees to participate in the program and get the most out of it.

Strategies for a Cost-Effective Workplace Wellness Program

Many businesses miss out on cost-effective strategies for workplace wellness programs due to a lack of planning. A recent study found that 65% of employers spend less than a year developing their annual benefit plan changes.

To optimize your program’s impact while staying within your wellness program budget, consider the following strategies: 

Leverage technology platforms: Utilize technology platforms designed for budget-friendly workplace wellness programs. These platforms streamline program management, reduce administrative costs, and provide tools to track program progress. By leveraging technology, you can save money and improve program effectiveness. 

Partner with local wellness providers: Explore partnerships with local wellness providers who offer discounted rates to businesses. These providers can offer services such as fitness classes, nutrition counseling, or stress management workshops at reduced costs. Leveraging local resources fosters community engagement while keeping expenses in check. 

Utilize existing organizational resources: Leverage resources already available within your organization to support your wellness program. If you have an on-site fitness center or health promotion staff, utilize them to provide wellness services and activities. This approach maximizes the use of existing resources and minimizes additional costs. 

Offer preventive health services: Prioritize preventive health services as part of your wellness program. Arrange for flu shots, health screenings, and health assessments that can identify and address health issues early on. This proactive approach reduces long-term healthcare costs by preventing or managing chronic conditions. 

Promote healthy lifestyle habits: A successful workplace wellness program should promote healthy lifestyle habits among employees. Encourage healthy eating habits by offering nutritious food options and educating employees about healthy food choices. Organize physical activity initiatives such as walking challenges or fitness classes to encourage regular exercise. Cultivate a work environment that supports work-life balance and stress management. 

Provide access to wellness resources and tools: Equip employees with access to wellness resources and tools. Offer online health information platforms, fitness trackers, or mobile apps that provide guidance on healthy habits and track progress. These resources empower employees to make informed decisions about their well-being and monitor their own health.

Evaluating & Adjusting the Wellness Program Budget Over Time

Wellness programs can be a valuable investment for employers, but it is crucial to regularly monitor and evaluate the budget to ensure its effectiveness.   

Organizations can effectively refine the wellness program budget allocation and make informed decisions by leveraging data-driven insights. This process entails tracking crucial metrics, including: 

  • Participation rates 
  • Employee feedback 
  • Health metrics 

Through data-driven insights, organizations can identify areas of the wellness program that yield the highest return on investment. Regular budget evaluation allows for resource reallocation towards components that have proven to be effective, resulting in maximum ROI. 

Furthermore, regular evaluation of key metrics and data-driven decision-making enables continuous improvement of the wellness program. By identifying trends, emerging needs, and successful practices, organizations can refine the budget allocation to ensure the program remains relevant, effective, and aligned with the evolving requirements of employees.


As the business world becomes increasingly competitive, wellness programs are becoming an essential tool for businesses that want to attract and retain top talent, improve their bottom line, and create a positive work environment.

Benefits professionals and HR should prioritize wellness program budgeting as a strategic investment for their organization’s success.  

By allocating resources wisely, leveraging data-driven insights, and embracing continuous improvement, businesses can create a culture of well-being that improves the employee experience, enhances productivity, and drives overall organizational success.

Disclosure: Some of the products featured in this blog post may come from our partners who compensate us. This might influence the selection of products we feature and their placement and presentation on the page. However, it does not impact our evaluations; our opinions are our own. The information provided in this post is for general informational purposes only. 

Written by Ivana Radevska

Senior Content Writer at Shortlister

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