Three years ago, Imax Corp. created a $500 annual wellness spending account for its Canadian employees to spend on anything related to health and fitness.

Employees can spend their allowance on things such as gym and sports membership fees; fitness classes and personal training sessions; smoking cessation; weight management; stress management and nutrition counselling programs; and fitness equipment such as yoga mats, skates or bicycles.

“We wanted to support the health and wellness of employees but we didn’t want to tell them how to specifically do it,” says Carrie Lindzon-Jacobs, executive vice-president of human resources at Imax. “So we gave them an amount of money every year that was actually going to make a difference.”

Read: KPMG sees big participation boost in Global Corporate Challenge

Since the account’s launch, employees have used the fund in a variety of ways. Lindzon-Jacobs says employees have started a Weight Watchers group, joined a marathon as a team and used the wellness account to make headway in the Global Corporate Challenge, a program that motivates workers to make healthy changes.

Imax sponsors the challenge by paying the entrance fees of employees who want to participate, according to Lindzon-Jacobs. “Employees are using their wellness allowance to get running shoes, spin bikes or swimming lessons to find ways to get their steps in as part of the [corporate challenge].”

While the wellness spending account at Imax is fairly new, large companies have been providing such allowances for years, according to Art Babcock, senior vice-president at Aon Hewitt. However, Babcock says these types of spending accounts will likely remain a benefit afforded only by large companies that have the resources to administer them.

Among the benefits of a wellness spending account is the fact that it can address the diverse needs of employees across different generations, says Lindzon-Jacobs.

Read: 93% of ABB Canada staff tailor their benefits plan

A closer look at the Imax wellness allowance

While the Imax wellness spending account tries to accommodate all types of expenses, there are some purchases it won’t cover, according to Lindzon-Jacobs.

“We won’t pay for clothing or recreational equipment like a pool table,” she says. “We don’t pay for ancillary fees related to activities, books or parking. We won’t pay for a golf cart because we want employees to walk. We’re encouraging this account to truly promote wellness.”

She also notes the account isn’t for health services such as massage therapy, which the company’s benefits program covers otherwise. Imax has a separate health spending account employees can use for costs above their coverage limits under the benefits plan.

While there have been claims the company has had to reject, Lindzon-Jacobs says most have been relevant.

“Instead of choosing what the personal health or fitness goals might be for each individual, we recognize it may be different for each person.”

At the same time, providing financial support helps remove a major obstacle people face in their pursuit of a healthier lifestyle, says Linda Lewis-Daly, a workplace wellness program consultant at GoodLife Fitness.

“If you provide access to those tools or services that will encourage healthy lifestyle choices, then I think the employer is going to win in terms of employee loyalty and productivity,” says Lewis-Daly.

Read: 6 tips for engaging employees in their health

“Preventing disease is less costly than an employee that goes off on disability because of an illness or an increased drug cost to manage illness,” she adds.

“So the money spent up front in prevention can provide the [return on investment] that employers would be looking for.”

Many employers are willing to spend money for that return. According to the 2016 Sanofi Canada health-care survey, 66 per cent of plan sponsors have increased their benefits spend over the past three years, while 43 per cent would be more willing to invest in programs and services that could help prevent future claims.

The response from employees at Imax has been positive, says Lindzon-Jacobs. “We got e-mails, phone calls and thank-you cards. They think it’s a very unique benefit, a draw to Imax, and it furthers the relationship we have with our employees because they feel we care about them.”

And while Imax isn’t looking for a specific measure of success, the company reviews claims to look for trends in regards to what employees are spending their money on. According to Lindzon-Jacobs, employee engagement improved in the latest survey, largely as a result of the wellness account.

Read: Sanofi survey finds gap in employer, employee views on benefits

In addition, more people are taking advantage of the account as each year passes. In the first year, 50 per cent of employees used the account, a number that reached 70 per cent by the third year, according to Lindzon-Jacobs.

“We’re expecting 80 per cent this year,” she says.

How can employers prepare to introduce a wellness spending account?

While a wellness spending account may seem straightforward, it’s more difficult to manage than it seems, says Aon Hewitt’s Babcock.

The flexibility means employees have some leeway around what they spend the money on, but there also needs to be limitations on which purchases constitute a step towards better health, he says.

Before creating a wellness account, plan sponsors should be strategic and ensure they establish a philosophy or culture of wellness that senior management supports, says Babcock. “If an organization is not really focused, then the benefit is not going to fly.”

He suggests companies should consider the program’s goals and approach in promoting wellness before creating a wellness spending account.

After doing that, organizations should create a list of the types of purchases they’re going to reimburse, says Babcock. The list doesn’t have to be exhaustive but it should provide some guidelines for adjudicating claims, according to Babcock.

“Some groups will actually survey their employees prior to developing the list in order to get a sense of their interest. The list should be revisited on an annual basis to reassess and see what should be added.”

Jann Lee is an associate editor at Benefits Canada.

Get a PDF of this article.

Copyright © 2018 Transcontinental Media G.P. This article first appeared in Benefits Canada.

Add a comment

Have your say on this topic! Comments that are thought to be disrespectful or offensive may be removed by our Benefits Canada admins. Thanks!

* These fields are required.
Field required
Field required
Field required