What does modern financial portfolio theory have in common with corporate investments in prevention programs?

When I graduated from MIT with a MS degree in Finance many years ago, I could never envision that I would be writing a blog comparing financial portfolio theory to investments in preventive care programs. Like many early missionaries, I will probably be martyred for comparing something as mundane as money to the wonders of preventing diseases and psychological conditions in the human body. But the world, being as it is, most decisions in the corporate world, even those regarding the human body, come down to money.

I have written many blogs and posts regarding how to calculate the ROI of prevention programs. But I would now like to step back and take a broader, or strategic view, of prevention programs.

Looking at the employee population, should there not be a variety of programs, some with long, medium, and short-term results, each with an ROI and level of risk in effectiveness? This is what we do in creating a balanced investment portfolio.

Read more: How to quantify other economic savings from wellbeing programs

Here’s an interesting example for you

Let´s take a look at the world before Covid. We were happy with our programs in preventing CHD, diabetes, smoking cessation, and high-risk maternity. Yes, we did have a sprinkling of EAP and stress reduction programs. Then came Covid, and all of a sudden, we focused almost exclusively on those programs dealing with psychological issues (some companies even had a combination and EAP, Digital Behavioral Platforms with little measurement of effectiveness, and a variety of stress reduction programs-it was the “Shoot, Ready, Aim approach”).

We did not even hear about physical diseases anymore, as they suddenly disappeared. Then came the Covid vaccinations and they became (rightly so) the highest priority. But all of a sudden, CHD and Diabetes started rearing their heads as if they had disappeared, on top of lingering Covid strains, and long forgotten polio, dengue, and meningitis.

In financial markets terms, this was a “trader” mentality-find a profit today not tomorrow. What we need is a balanced portfolio of preventive care programs, so that employers do well, no matter what happens. This means taking a longer term, strategic view of preventing disease and behavioral conditions.

Yes, it is impossible to create a balanced portfolio of prevention programs. Just contact us for additional guidance on how to do so. www.wellcastroi.com.