Use of incentives in wellness programs on the rise: study

Boston – Employers increasingly are relying on financial incentives to encourage employee participation in health improvement programs, indicates a study released Feb. 9 by the National Business Group on Health and Fidelity Investments.

The study, a follow-up to research conducted in 2009, involved 147 mid- to large-sized companies in various industries nationwide. Overall, incentives provided by the companies averaged $430 per employee in 2010 – a 65 percent increase from 2009, when average spending was $260 per employee.

The types of financial incentives offered for participation in wellness programs included cash, gift cards or contributions to health savings accounts. The study tracked four main categories of wellness programs: health risk management (e.g., onsite flu shots), lifestyle management (smoking cessation programs), condition management (nurse phone lines), and communication and education (company wellness websites).

Approximately 12 percent of employers surveyed use negative incentives, such as reducing employer contributions to health plans, for employees who do not participate. Aside from incentives, companies involved in the study spent an average of $154 per employee on health improvement programs. The majority was spent on condition management programs, such as monitoring diabetes treatment.

The study further indicated the number of wellness programs will increase in coming years, as 63 percent of employers said they intend to increase program offerings in 2011. “Wellness programs in the past have typically had modest impact because of low participation rates,” said Sunit Patel, senior vice president of Fidelity’s benefits consulting business. “But our study indicated that incentives are starting to make a real difference in employee interest and engagement.”