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Is PepsiCo’s Wellness Program Successful?

Pepsico’s commitment to health, safety, and wellness couldn’t be clearer. From a published manifesto of Pepsi’s resolve to better humanity with safer, healthier products globally to their in-house corporate wellness program, all signs point to a genuine care for people’s health.

The name Pepsi, after all, doesn’t immediately conjure up images of health so much as nutrition-less soda. However, PepsiCo products also include Quaker Oatmeal, Aquafina, Gatorade, and Baked! Lays, to name a few. So when Pepsi’s 2004 campaign to reduce trans fats in their Frito-Lay products and label their “Smart Spot Products” as healthier choices, they declared their healthy intentions.

A campaign to promote a Pepsi and health association makes sense. They want to create a positive image, and activism for healthier lifestyles impresses consumers. It’s also logical to treat their employees to a health culture with wellness benefits. After all, healthy employees save corporate dollars–big dollars.

Unfortunately, Pepsi’s program, which contains all the right ingredients–disease management and lifestyle promotion–publicly appears to have failed the one hundred percent approval for best wellness program by a Rand study. But that’s not the whole story.

PepsiCo-Scoreboard-PepsiCo's wellness program is successfulImage source

The Rand Study

The study reveals that Pepsi poured their money into chronic illness management (diabetes, asthma, hypertension, heart disease, etc.) with a return of $3.78 in health care costs (largely reduced hospital admissions) for every $1 spent on the program or $136.00 per member per month.

However, the money spent on lifestyle management, while it did produce benefits to employees, did not yield quantifiable monetary returns. But note, those who participated in the disease management and the lifestyle management programs yielded higher savings still–$160.00 per month and a significant (66%) drop in hospital visits.

Many commentators have used the 2014 study to somehow denigrate the effectiveness of all wellness programs, not just Pepsi’s. However, widely interpreting the very narrow results somehow skews the news.

The Rand study does not rate Pepsi’s program pass or fail. It merely shows that Pepsi’s disease management money yielded much more short-term ROI in disease management than its long-term ROI in lifestyle management investment. And the study measured health care costs in hospital and doctor visits not so much on the health of the participant.

The simple explanation by smart bloggers takes into account that healthy people making their life healthier prevent disease onset later in life. The return comes beyond the parameters of a seven-year study. The immediate benefits of those already suffering with chronic illness, such as hypertension and diabetes, will obviously yield measurably higher immediate return.

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PepsiCo’s Health Living Program

Despite the potentially misinterpreted study, PepsiCo Inc.’s Healthy Living program succeeds. It comprehensively promotes healthy lifestyle changes and chronic illness management. The latter consists of medication, lab test, and follow-up care reminders or nurse visits, for example. The former consists of preventing potential health problems like smoking cessation, nutrition, stress-reduction (Pepsi even offers a financial planning tracker) and exercise programs, among others.

The wellness program also includes health risk assessments, a hotline for nurse advice, on-site wellness events, and complex care, disease, and lifestyle management. On their website, Pepsi includes these other work/life benefits:

  • Employee Assistance Program (EAP)
  • Adoption Assistance
  • Auto and Home Insurance Program
  • Parental Leave
  • Car Discount Programs
  • Education Assistance
  • Service Awards
  • Commuter Reimbursement
  • Child and Elder Care Support
  • Matching Gifts
  • Employee Discounts on Cell Phones, Electronics, and Entertainment

And they boast numerous health insurance options and that 80% of their executives were promoted from within.

Pepsi maintains that energy balance is key to fitness and weight management: “balancing calories consumed and calories burned” to achieve long-term health benefits. The company has also sponsored programs and managed campaigns at schools to get students to walk more and to offer a wider range of healthier options for lunch and snacks.

So what’s the upshot on Pepsi’s wellness program? Good or bad?

The takeaway from the Rand Wellness Program Study is this: lifestyle management reduces health risks and absenteeism while increasing productivity–and prevents future illness (especially those with pre-conditions like prediabetes)–but disease management yields the highest ROI, so employers need to simply invest their money wisely and find less expensive means to improve employee health through their lifestyle changes program.

PepsiCo’s wellness program made people healthier. That’s what wellness programs do.


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