J.C. Penney Co. Inc. doubled health risk assessment participation by switching from the carrot to the stick.

At the same time, its lifestyle and medical management outreach program has successfully identified workers with health risks and helped them become healthier.

Employees who did not complete the health risk assessment were charged an additional $600 a year for their health benefits. Moreover, those who completed the form and were identified as having certain health risks but declined to participate in either the lifestyle or disease management programs also were assessed this fee.

“Instead of receiving goodies for taking, you avoided penalties by participating,” said Matthew Harmon, J.C. Penney's benefits delivery and retirement director.

While some might refer to this approach as the “stick,” Mr. Harmon euphemistically calls it “the frozen carrot.” The company previously had offered a health risk assessment, but only about 45% of employees enrolled in the company's health benefits plan typically completed this online assessment. But in 2010, the first year the “frozen carrot” approach was used, 95% of employees completed the form, which is a cornerstone of J.C. Penney's lifestyle and medical management program, administered by UnitedHealth Group Inc.

In addition to its extraordinarily high health risk assessment participation rate, J.C. Penney has been seeing steadily increasing engagement rates among employees identified through UnitedHealth's automated outreach for lifestyle and disease management.

If employees' responses to the health risk assessment indicate they may have one of five disease states — coronary artery disease, chronic obstructive pulmonary disease, diabetes, asthma or congestive heart failure — or they have certain health risks, such as smoking or having a body mass index higher than 33, they receive a call from one of UnitedHealth's nurse case managers, said Bill Carolan, account executive for UnitedHealth based in Plano, Texas. If the employee doesn't respond at first, they are contacted three more times, twice by phone and a third by mail, he said.

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With this targeted and persistent outreach, participation rates in J.C. Penney's lifestyle and disease management programs have grown from 55% of employees contacted in 2010 to 70% in 2011 and 75% in 2012.

More importantly, those participants' health risks are diminishing over time, leading to $6 million in clinical program savings in both 2011 and 2012, Mr. Harmon said.

Tobacco use has dropped 3% among participants, weight risk has fallen by 3%, and the number of employees with body mass index higher than 33 has dropped 2.1%. In addition to the health care cost savings from these risk reductions, Mr. Harmon estimates J.C. Penney has saved another $7 million annually through enhanced productivity and $2.8 million in reduced workers compensation and disability costs.

Among other things, the medical management programs ensure employees with chronic conditions see their doctors regularly and adhere to their medications, Mr. Carolan said. UnitedHealth's nurse case managers also monitor employees' weight, blood pressure and blood sugar levels.

“We have had several success stories where people have been able to get off their blood pressure or cholesterol medications by losing weight. In addition, we have had some who were pre-diabetic not convert to becoming diabetic,” Mr. Carolan said.