Designing Wellness Incentives

Many employers promote employee wellness programs, hoping to both lower their medical costs and improve their employees’ health.  Obviously, the challenge comes in getting workers to participate and become engaged in the process.

The first step should be to have employees complete a health risk assessment (“HRA”).  This gives employees the data they need to identify their own health risks and to take action on them.  It also provides the employer with an overall view of which health risks exist in their pool of employees, allowing them to develop a plan to target these risks. 

Many employers offer incentives to compel workers to take an HRA.  These may range from reduced health care premiums to cash or gift cards.  Unfortunately, few employers continue to offer incentives for continued participation in wellness programs beyond the HRA.  Arguably employees should want to participate in programs for their own benefit, but experience indicates that most need further motivation. 

The challenge for employers then becomes designing an incentive that keeps employees engaged and participating in the entire wellness process.  Instead of offering employees $100 to complete the HRA for example, a company may allow employees to receive rewards for completing various milestones within the wellness program.  Incentives can be paid as each milestone is reached, or paid upon completion of all milestones.  Some examples of these might be:

Employee’s completion of the HRA

Spouse / domestic partner’s completion of the HRA

Employee completing annual wellness visit

Spouse / domestic partner completing annual wellness visit

Employee going through a company wellness fair, including biometric screenings

Employee completing tobacco cessation program

Spouse / domestic partner completing tobacco cessation program

Especially as health premiums continue to rise, incentives might be to lower employees’ out-of-pocket medical expenses, either by reducing their payroll contributions or depositing money into a health reimbursement account. 

From Employee Benefit News, April 1, 2011 issue, p. 32.