Long Train Running

For many companies, a focus on employee wellness is just the latest fad. For Union Pacific it’s been a 20-year journey, as Barb Schaefer explains.

“75% of healthcare costs result from unhealthy lifestyles”
-Barbara Schaefer, Union Pacific Corporation

We really started our health promotion programs in the late 1980s. The president of the railroad at that time got very interested just from an intuitive standpoint in health promotion. He was physically active himself, and he put in our first fitness center. But as a railroad, most of our 50,000 employees are very mobile and not based in a single location. As a result, the first efforts at expanding beyond the fitness center in the headquarters building involved putting fitness centers on railroad cars and moving them around the system. 

But after a while we figured out that didn’t work as well as just getting memberships at places like 24-Hour Fitness and Gold's Gym for our employees. We now have arrangements with 600 facilities around our system where Union Pacific employees can go in and exercise. Our wellness efforts really started with the fitness centers.

We expanded from that to a program called Health Track in 1992, and we went out and really started measuring the fruits of our labors.  Again, we started with just the fitness center idea, which was relatively novel concept at the time. Then we went out and really started measuring how our employees were doing. We started with a pilot in North Little Rock, which later expanded around the system. We had a consultant at that time who looked at the Health Track pilot program and they found that we were reducing our healthcare costs as well as reducing our personal injury numbers.  As you may imagine, railroading work can be dangerous if not done well and according to guidelines, and we found that employees who were less fit or who were overweight, not only were they more likely to get injured, but they were more likely to get seriously injured. That gave us a lot of impetus for continuing with the program.

Obviously, programs like this have to demonstrate real value for money and that is something we have seen, certainly on personal injury and healthcare costs. The best information I got on this was from when I attended a meeting with Dr. Julie Gerberding, who was the head of the Centers for Disease Control until just recently. She gave me the statistic that seventy five percent of healthcare costs are directly related to chronic illness, almost all of which is a result of smoking, exercise or lack thereof and poor diet.  So it's pretty easy to extrapolate from that if 75 percent of your healthcare costs are a result of those lifestyle choices, you can make the business case very easily.

But making the business case is only half the battle. You also have to bring your people with you. Happily, I think our people absolutely get that this is a win-win for us. We want them to go to work, work safely and come home and be able to enjoy the fruits of their labors. We want them to have a good, long life with their kids and get the best from their retirement, and they understand that. So, we really tried to focus on three things, which are the exercise, smoking and diet. We do whatever we can to help people with that, whether that is promoting a Weight Watchers plan at work or providing gym memberships.  Just as an example, since we started smoking cessation program, we have gone from a prevalence rate of 50 percent smokers down to 11 percent of our employee population smoking in 2008. Obviously society in general is smoking less, but it doesn’t have a rate anywhere like that.

We have banned smoking on all of our property, which is 32,000 miles of railroad. Anyhow, it's not like banning smoking in a manufacturing plant.  We've banned it on all right across our network. We have put people through smoking cessation programs. We have offered nicotine replacement. We've offered pharmaceutical assistance outside the healthcare plan. In states where it's legal to do so, we don’t hire smokers.  We've really been very aggressive about it. Quite frankly, I thought when we started down this road that I would get a very negative reaction, but in fact, I get way more emails from people saying, “Thank goodness you're doing this.  You've changed my life. My wife's quit smoking along with me.” We really have had an extraordinarily positive response to it, which, frankly, surprised me.

We also have done things such as supported the Omaha Smoking Ban, because we recognize that we are a player in a bigger community. Right now we're participating in an effort to try and make Omaha healthier in general. It's our headquarter city, and we're not limited just to what's happening at Union Pacific for our own employees because we realize they only spend part of their lives here, and there's a huge influence by what's going on in the communities as well.

We have been recognized a number of times with the C. Everett Koop National Health Award and with the National Business for Health Platinum Workplace Award. That kind of thing really adds to our brand as an employer. We’ve hired 29,000 people since 2003 and one of the things that people look for in an employer is a place that's going to be concerned about their health status, as well as everything else.

One important factor if you’re asking your people to embrace this focus on health, is that it has to be backed up throughout the company. Out of our whole senior staff, there isn't a single overweight person. They are all into fitness.  They walk the talk and they support these initiatives when they're in the field.

It’s key that wellness needs to be viewed as an investment rather than a cost if the concept is going to catch on across the business world. That’s something that we are getting some positive signals about. We get benchmarked all the time, and I would say that is definitely an indicator.  I mean, that, to me, indicates there are a lot of people that are interested in what we've done and want to replicate it.  Frankly, we get a lot of ideas from other companies too about what they're doing. So I think it's definitely catching on.

For a new administration that is expressing a great deal of interest in bringing down healthcare costs, promoting wellness has to be a factor. Our view is that the best way to get healthcare costs under control is to reduce consumption. That brings us back to the statistic that 75 percent of healthcare costs are a result of lifestyle choices. You can really resolve the healthcare in the country if you go after these things. From what I've heard, I think that both parties may be at a point where they can reach agreement. Who can argue with just having people stay healthier in the first place?

Barbara Schaefer was named Senior Vice President, Human Resources of Union Pacific Corporation in April 1997, and corporate secretary for Union Pacific Corporation in June 2004. She has 28 years of experience with the company. Prior to joining Union Pacific, Schaefer was an attorney in private practice in Omaha. Schaefer is active in the community and has served as a board member of many non-profit organizations. She is currently vice-chairman of the board of Children’s Hospital. Schaefer holds a bachelor’s degree from the University of Nebraska-Lincoln, a J.D. from the University of Nebraska College of Law, and has completed the Program for Management Development at Harvard University.

A guide to Union Pacific’s range of health and wellness benefits

Employee assistance
Provides counselors to help employees address personal issues and be more effective at home and at work.

Health assessments and health counseling
Assesses risk for certain health problems and offers targeted counseling with a registered nurse to help decrease that risk.

Health consumer information
A 24-hour nurse line provides online information about healthcare topics, along with regional price and quality ratings for providers.

Wellness and fitness services
An on-site fitness center in UP’s Omaha headquarters and a network of fitness centers across the country for employees to use. In some locations, employees also have access to personal training and exercise classes.

Smoking cessation
A subsidized tobacco cessation program which includes prescription medication to reduce the urge to smoke, along with telephone counseling and educational materials.

You are what you eat
One of the major things that we have done in our headquarters building is based around healthy catering. We went all over the country to find a specific vendor to operate our dining facility so that we could try and make it the healthiest dining room in corporate America. We now have a menu where healthy items predominate. 40 percent of our menu items are sold from the healthy items. We have nutritional content information on everything in the cafeteria. We have also asked the vendor to put in healthy snacks in our vending machines, so a minimum of 50 percent of the items in our vending machines have to be healthy. When they cater meetings in the building you can't just have donuts and cookies. If you are going to have things like that, you have to have a healthy alternative such as fresh fruit or granola bars or other things that would be viewed as healthy at the same time. Even outside of work we try to focus on nutrition. For example, we run things like healthy cookery classes.