A growing number of American companies are turning to a carrot and sticks approach to offering health benefits to their employees, with rewards and consequences.
The goal is to improve employee health and knowledge about their decisions, as well as reduce the company’s health insurance risks.
According to a survey by Aon Hewitt, 83 percent of companies surveyed offered incentives participating in health awareness programs. The survey included nearly 800 large and mid-size U.S. employers representing more than 7 million U.S. employees.
These actions may include taking a Health Risk Questionnaire or participating in biometric screenings. Among employers that offer these incentive, 79 percent offer incentives as a reward, 5 percent offer them in the form of a consequence and 16 percent offer a combination of the two.
The survey showed almost two-thirds (64 percent) of employers offer monetary incentives of between $50 and $500, while nearly one in five (18 percent) offer monetary incentives of more than $500.
“Employers recognize the first step in getting people on a path to good health is providing employees and their families with the opportunity to become informed and educated about their health risks and the modifiable behaviors that cause those risks,” Jim Winkler, chief innovation officer for Health & Benefits at Aon Hewitt, said in a statement. “HRQs and biometric screenings are the key tools in providing that important information and serve as the foundation that links behaviors to action. Motivating people to participate through the use of incentives is a best practice in the industry and these strategies will continue to be a critical part of employers’ health care strategies in the future.”
According to a separate recent Aon Hewitt survey, conducted in partnership with the National Business Group on Health and The Futures Company, of the workers who were offered an HRQ and received suggested action steps based on their results, four out of five (86 percent) took some action. Nearly two-thirds (65 percent) of those who received suggested actions reported they made at least one lifestyle improvement as a result.
Employers also reported seeing some positive impact from offering incentives, with more than half indicating they saw improved health behaviors and/or an increase in employee engagement. In addition, almost half said they believe there was a positive impact on employee morale, satisfaction and/or attitudes, and 44 percent saw changes in health risks.
According to Aon Hewitt, a growing number of employers are beginning to link incentives to sustainable actions and results, as opposed to having employees simply participate in a program.
Of those companies that offer incentives:
• 56 percent require employees to actively participate in health programs, comply with medications or participate in activities like health coaching.
• 24 percent offer incentives for progress toward or attainment of acceptable ranges for biometric measures such as blood pressure, body mass index, blood sugar and cholesterol. More than two-thirds say they are considering this approach in the next three to five years.
• The survey also indicated a potential shift in how many employers are thinking about designing their incentive programs in the future.
In the next few years:
• 58 percent plan to impose consequences on participants who do not take appropriate actions for improving their health.
• 34 percent were interested in tying incentives to program designs that require a focus on health 365 days a year. For example, they may offer incentives for completing a progressive physical activity program that increases minutes each quarter, ultimately achieving the recommended cardiovascular physical activity of 150 minutes per week.
• 22 percent are interested in using game theories and concepts to improve existing programs or ideas.
• 20 percent are interested in rewarding employees at specific work locations who meet predetermined criteria.
“Today employers mainly rely on financial incentives to drive desired activities and behaviors, ranging from building awareness to achieving specific health outcomes,” Stephanie Pronk , health transformation leader for Health & Benefits at Aon Hewitt, said in a statement. “However, in the near future, these designs will be most successful and impactful when they are linked to an organizational culture that makes it easier for employees to make healthier personal decisions.”
