Myriad Approaches to Financial Incentives: Employer Survey Results Part 7

By Rajiv Kumar, M.D. on Jan 10, 2012 – 0 Comments

When it comes to engaging employees in wellness programs, financial incentives are all the rage. Payers are increasingly adopting the view that the same economic incentives that drive consumer behavior in so many other industries will also apply to health care. That’s why many of them are restructuring their benefit plans, raising premiums across the board and allowing employees to earn the money back by taking a health risk assessment, having a biometric screening done, scheduling an annual physical with a primary care physician, or joining a coaching program. We wanted to learn more about how large, self-insured employers approach wellness incentives, so we asked them. Here’s what they told us.

Key findings from the ShapeUp Employer Wellness Survey:

• Three quarters of large employers offer some type of wellness-related financial incentive to their employees.
• 90% of incentives are based on program participation, while only 10% are contingent upon actual outcomes.
• Dollar amounts vary, but the average per employee per year incentive is $375.
• Rewards come in all flavors including cash, premium discounts, HSA contributions, and prizes.

Employer Approaches to Wellness Incentives

Here are some direct quotes from the employers we talked to:

• “Incentives are helpful for getting people to do the biometric screenings and participate in challenges and a fairly low level of incentives will do it too. We get an enthusiastic response when we pair programs with incentives.”
• “We don‘t offer cash incentives anymore for wellness programs because we found in the past that we couldn‘t push the participation past 25% no matter the amount. It‘s mostly a time factor for our employees.”
• “For the first time, we had incentives of $520 for HRA completion and got 80% engagement. Next year though, we are changing the structure towards engagement in other activities and we only forecast 50% participation.”
• “We used to offer $200 for HRA completion, but we now offer $100. We actually received better completion rates than we did the year prior. That‘s where we say we‘ve created a culture. Even though you‘re not going to get an incentive, you‘re going to do it anyway. We‘ve had no complaints from employees for reducing the incentive.”

Despite varying experiences and differing views on effectiveness, self-insured employers are increasingly making use of financial incentives in their wellness program design. Incentive programs vary widely in their structures, with diverse views on per employee dollar amounts, rewards versus penalties, incentivizing participation versus outcomes, and providing cash versus other forms of rewards. Employers appear to be largely experimenting with different approaches but looking for evidence-based guidance and best practices for optimizing their incentive dollars to achieve the largest and most sustainable outcomes.

Want to learn more? Download the full results of the ShapeUp Employer Wellness Survey or sign up to attend our webinar, where employers will have a live debate about this topic and many others.

Tags: employee wellness incentives, wellness incentives, social incentives, financial incentives