Employers remain committed to improving worker health, but according to a new survey, many are tightening requirements to receive financial incentives for participating in health and productivity programs.
Fifty-three percent of large employers currently offer financial incentives to workers who enroll in health engagement activities, according to professional services company Towers Watson and the National Business Group on Health (NBGH), a nonprofit association of large U.S. employers.
But participation alone in these programs is no longer enough to earn a reward. More than one-third (37 percent) of employers reward only those workers who meet the company's requirements for completion of a health engagement activity and almost one-third (29 percent) only reward members who participate in multiple activities.
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Still, 93 percent of employers have no plans to eliminate their health promotion programs, and 83 percent have no plans to cancel or delay adding new ones. But why invest in health programs if no one's going to take advantage of them?
"Employers are frustrated by their employees' low use of expensive health improvement programs," said Ted Nussbaum, senior consultant at Towers Watson. "As employers continue to empower workers to be more health focused, they are beginning to target and reward those workers who demonstrate a real commitment to making positive lifestyle changes."
What's more, employers are taking more proactive approaches like penalizing workers for unhealthy behavior. A new survey of nearly 600 large U.S. employers by Hewitt Associates shows 47 percent say they either already use or plan to use financial penalties over the next three to five years for employees who do not participate in certain health improvement programs.
Of those companies using or planning to use penalties, the majority (81 percent) say they will do so through higher benefit premiums. Increasing deductibles (17 percent) and out-of-pocket expenses (17 percent) were also cited as possible penalties. When asked what types of behaviors or programs they would penalize, almost two-thirds (64 percent) of employers cited smoking, half (50 percent) indicated not participating in disease management/lifestyle behavior programs and 45 percent noted not participating in biometric screenings (45 percent).
"The economy and continued escalation of health care costs have driven many employers to be a little more bold and demanding of their employees, making disincentives an increasingly attractive option," said Cathy Tripp, a principal in Hewitt's Health Management practice. "As companies learn more about their workforce, they're realizing that some people may be more motivated to take action if they risk losing $100 versus gaining $100. The key for each employer is to find the right mix of strategies and plan designs that will motivate employees to be healthier, but not go so far as to drive the wrong behaviors."
Get more: Almost half of American workers stay committed to their jobs because they like their employer's wellness program. A recent survey from Principal Financial shows how much wellness initiatives are driving retention at many U.S. companies.
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