Organizations, large and small, for-profit, non-profit, governmental have used healthcare benefits to attract, retain and improve productivity since the 1950s.

          In the 1950s, labor unions became very strong and had the power to shut down or reduce the profitability of "the for-profit" companies, as well an negatively impact the ability to provide critical functions like transportation, sanitation, mail delivery. In the beginning unions focused on wage increases, but as time progressed many organizations offered very attractive healthcare, vacations, pension programs to substitute for wage increases.

          This was a win-win for all concerned. Employees were happy to have more time off and to know that their healthcare and those of their dependents were available at no or little cost when needed. Organizations benefited since the labor force was young and healthy and so not expensive to provide these benefits. The medical industry was happy to know they didn't have to worry about getting paid and they could charge what was needed to make a handsome profit.

          This situation remained until the 1980s, when the workforce started to age and therefore had more health and mental issues. The Medical technology and drugs improved, but so did the cost to provide them. There became more expensive procedures, diagnostics and more law suits for mal-practice. In short costs began to accelerate, while the economy stalled and even declined. This increased costs to organizations providing the payments, the healthcare industry became more costly and had lower profits. Further there were more complex cures and prevention.

          Today we have a very different situation and healthcare has become one of the largest expenses to do business. These changes have forced organizations to cut back, even eliminate some or all healthcare programs. Or to force the employee and patients to pay more of the cost of the procedures, diagnostics or insurance. Government has dramatically influenced what providers are paid, how and when they are paid.

             There is an increasing number of people who are not able to pay for the care they receive or the insurance that they use to depend on. Healthcare organizations are having major cash flow problems, forcing more consolidation and even the elimination of some services.

        In our next section we will discuss why and how providing healthcare and fitness programs is critical for all organizations and even with the increasing cost of providing these benefits, organizations must learn how to solve the problem.