Originally posted December 15, 2014 by Mike Nesper on Employee Benefit Advisor
Increasing participation in a particular activity can be done with incentives, “but you can’t buy commitment to health,” says Alexander Domaszewicz, a principal and senior consultant with Mercer. “Getting people committed to health takes other influencers and motivators.”
That’s the state of wellness programs in the workplace, Domaszewicz says, trying to make a program as valuable as possible and doing so in a meaningful way. “We’re enhancing and refining as we go,” he says.
More employers are using outcomes-based incentives, says Beena Thomas, Optum’s vice president of health and wellness. “It increases personal responsibility,” she says. Financial incentives, like premium reductions for employees who meet biometric thresholds, are widely used, but there are other strong motivators, Domaszewicz says. People are more likely to participate if an activity is easy and accessible, he says. Participation is less likely if an activity is difficult, he says, even if there is money attached to it.
Wellness programs have moved past a one-size-fits-all mentality, Domaszewicz says, and employers are now focused on employee health both at work and at home. The latter is even being recognized — such as rewarding someone who plays in an adult soccer league.
Employees prefer face-to-face interaction
There’s also more focus on one-on-one interaction, Domaszewicz says. “We tried to make everything so digital in the last decade,” he says, but employees prefer in-person communication. Employers are bringing professionals, like dieticians, to the workplace, Thomas says. “Employees like to see someone face-to-face,” she says.
Social media has helped increase participation, too, Thomas says. “Social media has played and will play a larger, more defined role in driving employee engagement,” she says.
Wellness programs have evolved rapidly in the past five years, Domaszewicz says, just look at all the wearable devices available today. “There’s a lot to be said for the groundswell of support we’ve seen,” he says. Wellness should continue to accelerate and be more successful in the future, he adds.
Wearables are evidence that employers are focusing on outcomes rather than return on investment, says Robin Widdis, business unit president and interim wellness director at CBIZ. “It’s about encouraging employees to take their health more seriously,” she says, “and employers have shown greater interest in healthy outcomes rather than dollars spent.”
An integrated health strategy is an approach many employers are taking, Thomas says, and using one vendor for all benefits. “Affordability still continues to remain paramount for employers,” she says.
Regardless of any new legislation, Thomas says wellness programs will keep progressing and employers will continue to emphasize wellness as a core piece to their business strategy. “It’s not something that just sits siloed in the HR department,” she says.
Perry Braun, executive director of Benefit Advisors Network, isn’t so sure. “Intuitively, it is a sound business strategy to invest in these programs, however, businesses are cautious about making investments until the regulatory environment and tax policies have greater certainty or predictability to them,” he says. “Wellness programs require a long-term view and investment from the business community, and unfortunately, the overall business climate is short-term focused at present.”
Advisers got a reminder this year to make certain wellness plans are compliant with the Affordable Care Act after the EEOC sued Wisconsin-based Orion Energy Systems, claiming the employer imposed too harsh a penalty for opting out of the program. Employees who participated had 100% of their premiums covered by the employer, while those who didn’t participate had to pay 100% on their own.
“For a lot of employers it was frustrating to see these lawsuits because they’ve been asking for clarity — not legal action — for many years,” says Karen Marlo, vice president at the National Business on Group Health. “I think there’s a lot of concern. There’s certainly been a lot of going back and reviewing the programs they’ve put in place.”
It’s difficult navigating the various regulations surrounding health care, Marlo says, making it crucial advisers ensure programs are compliant with the ACA, GINA, ADA and HIPAA to avoid lawsuits.
What to expect in 2015
In 2015, employers will continue to shift the rising cost of health care to employees, Widdis says, which will create “an emphasis on healthier lifestyles. There will also be more of a focus on taking action versus pushing information.” Gone are the days of handing out booklets on the dangers of smoking, Widdis says, and employers are now taking action such as charging smokers higher premiums.
Vinnie Daboul, partner at Sage Benefit Advisers, agrees, saying “the successful wellness programs are not going to be the status quo.” Effective programs will be ones that take action based on biometric data and reduce claims, he says. “When you start talking to some of the organizations that are tied to wellness, they’re starting to look at changing the claim curve,” Daboul says.
That includes involving family members, Widdis says. “Employers are also encouraging employees’ spouses and families to become more involved in their wellness programs,” she says. “Moving forward, employers are making wellness less about ROI, and more about improving health, productivity and morale.”