(FORTUNE Magazine) – Deep in the Louisiana bayou, a team of leathery pipeline workers--of all people--celebrate the rigors of healthy living. A few years ago the 14 men who operate a 22-acre natural gas platform in the Gulf of Mexico near the Cajun town of Cocodrie shared a sedentary, gluttonous existence. At work they gorged on deep-fried crawfish or spicy, sausage-laced gumbos, topped off by slabs of cheesecake. Chefs risked getting fired for holding the tabasco or serving anything too healthy, like an overdose of vegetables. Quips Gerald Thurston, a Tenneco manager who supervises the platform: "The attitude was, The more you eat, the more you earn."

Workers regularly added five pounds a year; you could judge their age by the size of their bellies, like counting the rings on trees. By 1989, ten had dangerously high cholesterol. Fearing a medical time bomb, Tenneco began hounding employees to get healthy. Today it helicopters in nurses about twice a year to conduct tests and dispense advice. It presses physicians to set up frequent appointments with each man. Employees fill their plates with baked chicken and salad prepared by Tenneco's hand-picked caterer, and pump iron in a well-equipped fitness area. The five fattest employees have lost an average of 26 pounds each since 1989. Though half the workers are over 45, not one has suffered from heart problems.

By turning a gaggle of coronary candidates into a relatively fit, diet-conscious crew, Tenneco is doing more than saving lives. It and a growing number of other companies now understand that it pays to keep workers healthy. Recent studies show that for every dollar invested in preventive health care programs like Tenneco's, a company can save as much as six dollars in insurance costs. Johnson & Johnson, for instance, which spends about $4.5 million a year on preventive health care programs, estimates its medical bills would be higher by $13 million a year (or 15%) without its wellness program.

This campaign against illness marks a crucial second phase in corporate America's war on medical costs. The first was the shift over the past few years to managed care. By pushing down prices and cutting unnecessary procedures, HMOs are slowing the rise in the gargantuan $236 billionÊhealth care bill that's whacking companies' competitiveness. The second and newest phase is improving employees' health habits so there's less chance they'll get sick to begin with. "Companies face a huge potential liability for high-risk workers who are likely to be tomorrow's cardiac or cancer victims," says Carson Beadle, a managing director at William M. Mercer, a consulting firm specializing in health care. "By helping employees change now, companies can hold down those future costs."

Health promotion is growing so fast that it now awards Oscars for wellness. Each year the Health Project, a nonprofit group of 55 executives, labor leaders, professors, and government officials, honors the nation's best health promotion programs with the C. Everett Koop National Health Award. Named for the former Surgeon General, (who's also a member of the panel), the prize has gone to companies like Union Pacific, Dow Chemical, and L.L. Bean. Over the past three years the contest has attracted more than 200 candidates as varied as IBM, Coca-Cola, and General Electric. Since 1992 the Health Project has picked 12 Koop winners that still have model programs. Together, they form Fortune's list of America's Healthiest Companies.

As the roster shows, health promotion works in a wide variety of industries. Naturally, savings aren't quite as high for financial service or software companies, whose employees are a lot younger and healthier than the aging laborers in railroads or steel. Yet whatever the profile--thirtysomethings or veterans, telephone marketers or trainmen--the payback can be large. Healthier workers run up fewer medical bills; they also work harder and take fewer sick days. This new move toward healthier employees goes far beyond corporate fitness centers and antismoking seminars. The Koop winners relentlessly monitor and manage their workers' health, focusing on two main strategies: prevention and early detection. Preventing disease means finding employees who have the highest risk of developing a serious illness and getting them to break their bad habits before it's too late. For most companies, 10% of employees account for more than 80% of medical costs, which now average $3,781 per employee. Increasingly corporations conduct broad screenings, using voluntary questionnaires and tests to identify the smokers, beer abusers, couch potatoes, and bingers who suffer most of the costly calamities like cancer, heart attacks, and underweight babies.

The second strategy is early detection. By conducting mammographies at the office--or reimbursing exams and annual checkups--companies catch breast or prostate cancers while they're still relatively inexpensive to treat with quick, simple surgery costing less than $15,000, or drug treatment that's even less expensive. In the advanced stages, such diseases can run $40,000 or more for multiple operations and intensive chemotherapy.

Wait a minute. Why aren't the HMOs taking care of prevention? Isn't their trademark keeping people healthy? Unfortunately, most HMOs--despite their extravagant claims--don't pinpoint who's likely to get sick. Nor do they systematically pursue high-risk patients to improve their lifestyles. "Since HMO physicians get a fixed payment per person under capitation, many of them want to see people as little as possible," says Dr. Kenneth Wells, Tenneco's medical director. So keeping people well falls by default to employers. Many workers are understandably queasy about divulging medical secrets to their companies, who they fear will fire the high-risk workers or browbeat them into dropping bad habits. Never mind that doing either is illegal under federal employment laws.

For health promotion to work, companies must put employees at ease. The Koop winners emphasize that participation is strictly voluntary. Many hire outside firms to do the testing and counseling. Often no one at the client company even knows who the high-risk people are.

Truth is, most companies find that employees jump at the opportunity for help. At Steelcase, for instance, Carol Lindsey, 32, an employee benefits assistant, enthusiastically joined the office furniture maker's wellness program. Five years ago she smoked, gorged on nachos and dip, never exercised, and suffered severe stress from working while raising two boys. Her health risk exam showed a high likelihood of heart disease--the illness that killed her father. "I didn't want to end up like Dad," says Lindsey. "I need to be here for my kids." Today, Lindsey dines on fish and fruits and religiously does water aerobics and runs on the treadmill. She has lost 22 pounds and thrown away the cigarettes.

One of the biggest health challenges facing companies is finding the high-risk people in their organization. It isn't easy. Many don't even realize their health is deteriorating. Smart companies, like Steelcase in Grand Rapids, use sophisticated screening processes that uncover disasters waiting to happen. The company, which employs 8,000 mostly middle-aged men, looks for red flags like high cholesterol and blood pressure, smoking, obesity, lack of exercise, and mental stress. Between ages 45 and 65, workers with six or more risk factors cost four times as much as those with none.

The secret to saving money is reducing risks, says a University of Michigan study that tracked 4,000 Steelcase workers from 1985 to 1990. High-risk employees who shed all but one or two bad habits cut their medical costs by 54%. When people cross the Rubicon to high risk, the usual migration that comes with age, medical bills grow more than 100%.

For Steelcase, the mission is rallying people from high- to low-risk categories and keeping the healthy from backsliding. To identify those in danger, the company employs six wellness workers, including an exercise physiologist and three health educators. Employees complete a six-page questionnaire describing habits like eating and exercise; the physiologist measures their blood pressure, cholesterol, and body fat. About 60% of employees participate in the screenings, held every two years. Roughly one in nine is high risk.

A wellness worker meets with virtually every high-risk employee (only a few decline). The counselor invariably prescribes lots of exercise and offers, as encouragement, a free three-month membership in Steelcase's sumptuous, 25,000-square-foot fitness center, boasting basketball courts and a sunlit indoor swimming pool, not to mention a tofu-intensive salad bar. The center's staff act as personal trainers, guiding their puffing charges through exercise routines designed to reduce body fat or lower blood pressure. The center's nutritionist teaches them to cook low-fat meals.

Steelcase has dramatically shrunk the number of high-risk employees--and slowed the increase in medical costs. These are rising at just 2% a year, one-third the rate for most industrial companies. Steelcase reckons its wellness programs should save it $2 million a year, nearly a 6-to-1 return on investment.

While most employees willingly cooperate with wellness programs, what happens when someone refuses to give up the pizza and the Marlboros? Union Pacific has some answers. At this old-line railroad, changing lifestyles is like pushing a rusty boxcar uphill. The highly unionized workers are suspicious of almost any kind of management program. Yet the company must do something: It spends $6,000 per worker on medical claims, almost twice the average for industrial companies, and pays an estimated $40 million a year for diseases directly caused by unhealthy habits. By far the biggest problem is heart disease. Big-bellied trainmen, who run the locomotives, disembark in rural southern towns at midnight to dine on chicken-fried steak and gravy-soaked biscuits, then return home the next morning, fueled by gallons of coffee.

To get the employees to pay attention to their health, Union Pacific has hired an outside firm, Kersh Wellness Management, to find and counsel the high-risk workers at its facility in Little Rock. From the 2,000 employees, Kersh identified 300 with poor health habits. Three Kersh employees pay them regular visits at workshops and rail yards to monitor cholesterol and blood pressure. At least once a month they call high-risk employees at home to advise them on diet and exercise.

Getting the crotchety candidates to cooperate is a slow, delicate process. The first barrier is convincing workers the information won't be used against them. Patsy Parker, a counselor at Kersh, shows workers copies of the federal law that bans companies for punishing workers for poor health habits. Still, the Arkansans revel in overeating and underexercising. "At first, I talk while they yell, 'I won't change my habits!' " marvels Parker. But her persistence works. About 80% of the employees in danger end up cooperating with the counselors.

The secret, says Parker, is building small gains into giant improvements. The best way to lose a prospect, she warns, is to prod him first to stop smoking. Instead, Parker begins with baby steps in diet and exercise. She has gently guided Paul Imhoff, a 43-year-old who checks locomotives for repairs, to a far better lifestyle. A briskly speaking, bearded extrovert who sports a yellow hard hat, Imhoff two years ago had extremely high blood pressure and carried a bulbous 230 pounds on his 5-foot 10-inch frame. He was packing on five to ten pounds a year. Each month Parker advised him to make a single change: Substitute mustard for mayonnaise on his sandwiches, use low-calorie salad dressing, or extend his nightly walk from 30 minutes to 45 minutes. Parker, an unabashed zealot, even asked Imhoff's wife to substitute ham sandwiches for baloney in his lunch pail.

Imhoff has shed 20 pounds and reduced his blood pressure an extraordinary 33 points, to a robust 120/80. "It was nothing drastic," he says. "I was never starving to death, like on a lot of overnight diets." Imhoff doesn't follow Parker's advice to the letter, like limiting his portions of steak to the size of a deck of cards. "I make it two decks of cards," says Imhoff. "Hell, I used to think a portion was the size of a plate!"

In an odd twist, Union Pacific uses a role model to inspire workers like Imhoff to pursue fitness. He's Jim Yates, a locomotive repairman in UP's Little Rock facilities who holds the world championship in wrist wrestling, an international sport similar to arm wrestling. At 6 foot 2 and 240 pounds, the barrel-chested Yates has biceps as thick as most men's thighs. He inspires awe among his colleagues for his amazing conditioning. A 53-year-old grandfather, Yates bench-presses 405 pounds. His opponent for the world title last August was 32. Nicknamed the "Arkansas horse," he once appeared in a TV ad pulling a boxcar with a harness. Yates displays exemplary eating habits, lunching in the repair shop on fruit and Lean Cuisine. "I advise workers to stay in shape to avoid injuries," says Yates. "Railroad people look up to strength. They know I'm not full of bull."

Over three years, almost half of UP's high-risk workers have achieved normal blood pressure, while 21% have stopped smoking. The company estimates that its yearly $1.2 million investment in health promotion will reap three times as much in lower medical costs. Many companies, especially those in the service sector where female employment abounds, are tapping a surprising source of savings: minimizing the costs of childbirth. First Chicago spends $10 million of its $45-million-a-year medical budget on a perpetual baby boom of 800 annual deliveries. By promoting healthy lifestyles, the banking company is sharply reducing two expensive complications of pregnancy, cesarean section deliveries and underweight newborns. C-sections cost an average of $12,000, twice as much as a vaginal delivery. The expense of keeping an underweight infant in intensive care can run $100,000, followed by even bigger bills if the child is brain damaged. Normal pregnancies also reduce absenteeism. At First Chicago, almost half of all days employees take off from work are for maternity.

First Card, the company's credit card division in Elgin, Illinois, is a cathedral to healthy maternity. Almost 80% of its 2,500 employees are women, most of whom are in their prime child-bearing years. First Card's campuslike facility is designed for working mothers, down to the $900,000 day care center and lactation rooms where mothers can express milk for baby.

The idea is to provide a full education--and plenty of services--for women too busy to make frequent visits to the doctor. First Card starts working with employees before they get pregnant. That's the time to catch problems that can cause birth defects. Women seldom see a physician before they're expecting, but First Card offers a thorough risk appraisal before conception. For women who haven't had, say, the German measles, First Card's nurses recommend getting an immunization. If contracted during pregnancy, the disease can cause severe abnormalities in a newborn child.

For pregnant women, First Card offers three-hour seminars in prenatal care. The nurses warn against bad habits that can cause underweight babies, like smoking, drinking, and poor nutrition. If a woman completes the prenatal program by the 16th week of pregnancy, First Card waives $300 in deductibles toward health care for the baby. The carrot works. Almost two-thirds of the pregnant employees take the course.

First Chicago also conducts free, onsite screenings for breast cancer twice a year. So far it has caught seven cases. For Doris Wiskirchen, now a health care worker at First Card, the tests were a lifesaver. In 1991 the mammogram revealed a tiny tumor, undetectable in a physical exam. Wiskirchen had a successful mastectomy. "If the test hadn't been right here, I probably would have put it off," muses Wiskirchen, 60. "The convenience of just leaving your desk for 15 or 20 minutes for a quick exam gets people to participate."

For First Chicago, wellness is showing noble gains. Its frequency of underweight babies is just 3%, less than half the national average. Its rate of C-sections is also far lower--and still declining. The mammography program is another money saver: Caught early, breast cancer costs $14,000 to treat, vs. $40,000 for advanced cases.

It's a long way from the steamy Louisiana bayou to the neat Chicago suburbs. But in both places, companies are teaching, cajoling, coaching, and scolding their way to a hidden treasure--the rewards of keeping employees healthy. Sure, the problem is time-consuming and delicate. Turning companies into health care counselors demands a significant investment. But the success of health promotion proves that if companies will lead, employees will follow.