Employers are increasingly using wellness programs to improve health and lifestyle of employees. Many employers offer wellness programs to reduce health care costs. This dissertation examines enrollment in health insurance and medical utilization when a wellness program is offered by the employer. Using a unique dataset of health insurance choice and utilization, the study estimates the effect of peer choices and family health on the choice of a health insurance plan with a wellness program. The results show that a 10 percentage point rise in the peer enrollment in the wellness plan increases the likelihood of own enrollment by 1.4 to 3.7 percentage points. The presence of severe health conditions reduces the probability of enrollment by up to 4 percentage points, but more intense users of medical services have a higher probability of being enrolled in the wellness plan. Looking at the utilization of medical services, I use propensity matching mechanism to compare the sample of wellness member to non-members. The results suggest that following enrollment, wellness members tend increase the use of preventive care services. Use of emergency and inpatient hospital services declines in both expenditure and number of visits. However, overall, the growth in preventive care use offsets the decline in emergency and inpatient care use. These results suggest that, at least in the short to medium term, preventive care is not likely to moderate the growing medical expenditure. However, improved information about the benefits of wellness plans may result in wider gains in the longer term.