Monetary rewards motivate employees to get healthyIt’s no secret that America has a health insurance problem. Rising health care costs and declining health has left companies struggling to provide the kind of health insurance employees had ten years ago. Affordable Care Act customers turned out to be much sicker than anticipated, and now health insurance companies are seeking rate increases of twenty to forty percent or more.
The industry’s answer was to offer wellness programs designed to promote awareness, education, and lifestyle change. The programs have evolved into an overly saturated market of wearables, apps, and fun programs without accomplishing the original goals. A recent study by MetLife claims that nearly seventy-five percent of employers offer a wellness program but only twenty four percent of employees actually participate. Worse yet, those who participate are primarily employees who have already adopted healthy lifestyles. The remaining participants are those with greater health risks. When cash incentives are used, the employer pays low-risk employees resulting in an expensive program with little to no improvement in employee health or reduction in health care claims.
Unhealthy employees do not participate in voluntary wellness programsThe goals of wellness programs are noble, and some of the services are outstanding, but the dark secret of the wellness world is that the services are provided to the low-risk population. Researchers at Oliver Wyman, a subsidiary of one of the largest global insurance consulting firms, Marsh & McLennan, say the solution for businesses to engaging the entire population is to “Stop treating wellness as an add-on to [the] business. Start making it the core of everything [they] do.”
For supplemental wellness programs to succeed and engage the majority of a group’s population, employers need to build programs into the design of their health plan. Health rewards must be outcome-based and tied to the deductible.
Outcome-based incentives (OBI) are monetary rewards tied to lifestyle biomarkers such as BMI, cholesterol, nicotine, blood sugar, and blood pressure. Deductible-OBIs reward employees through the deductible. The results of adopting OBI health initiatives has been reported as high as ninety-five percent participation. More importantly, OBIs decrease claims because employees are held accountable for their results. Similar to the good-driver car insurance discount, all employees are given the same supplemental health insurance plan, and have the ability to earn rewards by achieving health goals.
Deductible outcome-based incentives are the most costeffective type of wellness incentive
Deductible OBIs are the most cost-effective, engaging way for an employer to offer wellness incentives to employees. With traditional cash-equivalent or premium incentives, low-risk employees who are expected to have minimal claims end up costing the employer as much as those with higher-risk employees. With deductible incentives, employers are able to fairly offer thousands of dollars in incentives without draining cash flow. In return, employees are empowered with the ability to control their plan and earn substantially lower deductibles. The entire population is engaged and the high-risk employees receive support, resources, and motivating financial incentives to make healthy changes. Combining advanced wellness programs with deductible OBIs allows companies to achieve over ninety- five participation and give the entire population the power to identify and address health risks to achieve health goals.
Kristy Dalechek, RN-BSN, has studied health and wellness for over twenty-five years. Passionate about prevention and population health management, Dalechek began her career with BeniComp® as a Health Coach and quickly advanced to overseeing BeniComp®’s Predictive Health Management division of nurses, until she transitioned into the Business Development Executive to combine her dual degree of nursing and finance.