Original article from benefitspro.com
By Allen Greenberg
Short of bribery and potentially violating anti-discrimination laws by not hiring obese smokers, there’s little employers can do to improve the health of their workforce.
Or is there?
What looks to be a growing number of employers are, in fact, embracing outcomes-based disincentives to prod employees to achieve specific health outcomes, rather than merely enroll in their wellness programs.
Off the bat, I know that sounds like Big Brother. But I also think it sounds like a constructive and fairly non-intrusive way for employers to try to regain some control in the losing battle to reign in health care costs.
The Midwest Business Group of Health, a Chicago-based nonprofit group with more than 120 large, self-insured public and private employers, dug into this question in one of its latest surveys and came up with some interesting findings about the carrots and sticks employers rely on.
Let’s start with what everyone enjoys.
Among employers offering incentives, 62 percent report they offer employees who follow their wellness programs reduced premiums. Another 38 percent use gift cards and 35 percent offer merchandise.
Not bad. Put down the Hershey’s Kisses between meals and get a nicely loaded Starbucks gift card at the end of the month.
Actually, in a lot of instances, we’re talking about something of much greater value. Twenty-two percent of the companies in the survey reported their incentives were worth $500-$1,000.
Seventy-one percent of the surveyed companies said they found their incentive strategy was “very successful” or “successful.”
So, how about the stick?
More than 37 percent said they have begun to rely on penalties in response to nonparticipation in their wellness rewards. Increased health care premiums and coverage plan limitations are among the more common sticks.
This is a new trend, to be sure, so there’s some measure of experimentation going on and certainly room for improvement. Just 45 percent of those surveyed viewed their disincentive strategy as “very successful” or “successful.”
That shouldn’t be taken to mean we won’t see more of this. As Cheryl Larson, vice president for the Midwest Business Group on Health, will tell you, employers are fairly desperate nowadays to find ways to save health care dollars.
Which is why more than 40 percent of those surveyed now expect their employees to kick in a higher share of their plan premiums if they don’t stay on track with the company’s wellness programs, while another 16 percent are considering doing so.
Wellness programs have been around for decades, but there’s still a lot for HR managers to learn about what works and what doesn’t, and there’s naturally going to be squeamishness about pulling out disincentives.
One key lesson shared by an employer cited in the MBGH survey:
“Even though our employees were not happy about the implementation of the program, we have a very compliant population. We know they complain about it, but they end up participating to take advantage of the incentives.”
In other words, yes, incentives, are always going to be popular. But if they don’t work, you might try throwing a few disincentives into the mix, rather than tossing away millions more in benefits dollars.