Of course warming hands and using the warm towel is good for health especially if the peeps have a bad health.

It is difficult to fill the health-indicator but I think it has to do with feed. When the peeps have a good feed-level (i. e. when you make them barbecuing to raise the level) then they try to improve the health-level too. It is quite rare that they want to improve their health-level when the feed-level is lower than the health level.