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Retooling pay to play

Employers overhaul wellness incentives to drive engagement

Retooling pay to play

Incentives remain a key factor in the success of workplace wellness programs, but some employers are rethinking how they motivate workers to get healthy.

Wellness programs without incentives are prone to failure, many experts say. Absent the allure of a reward or the fear of a penalty, employees are more likely to skip an annual biometric screening, weight management program or nutrition seminars.

Most employers put money in their workers' pockets to drive participation.

According to an April survey by the National Business Group on Health and Fidelity Investments, 72% of employers currently offer wellness program incentives, which often are tied to biometric screenings, health risk assessments and physical activities.

Lump-sum premium reductions or one-time contributions to health savings accounts continue to be the most common financial rewards.

“We still see that financial incentives tend to be the largest strategy when it comes down to brass tacks,” said Stacey Nevara, vice president of client relations at wellness program provider Interactive Health Inc. in Schaumburg, Illinois. “Money can talk.”

While many employers also reward employees for reaching specific health goals, some are re-evaluating whether the strategies are worth the investment.

“There's a lot of reconsideration” of wellness incentives, said LuAnn Heinen, vice president of workforce well-being, productivity and human capital at the Washington-based NBGH. Employers are asking, “Are we on the right path? Should we just keep doing what we're doing? Should we re-evaluate? What's going to be most aligned with where we are trying to go?”

“One-time (financial) incentives are really good for awareness activities, like a health (risk) assessment, biometrics, things like that. When you get into other activities like behavior change coaching, long-term exercise, diet and stress management, financial incentives — especially big-lump delayed-gratification financial incentives — tend to not be very successful,” said Seth Serxner, chief health officer at health services company Optum Inc. in San Francisco.

Instead, smaller and more frequent rewards and social recognition can help keep employees' attention longer and drive behavioral change, which is the goal, he said.

For instance, Juno Beach, Florida-based renewable energy firm NextEra Energy Inc. keeps its employees engaged in wellness by raffling off items such as iPods, cookbooks or on-site gym memberships for workers who participate in fitness, weight management or nutrition programs. Workers who attend a weight management class, for example, are included in a drawing to win a prize.

“We find that doing raffles on items really works well. If you look at some of the data in the area of behavioral economics, it really does support that people are more likely to do something if there's a probability of them winning a large or more valuable prize than if everyone got something at a lower value,” said Andrew Scibelli, manager of employee health and well-being at NextEra, which has 14,300 employees in the U.S. and Canada.

“We have seen an uptick on not only the participation of these programs, but also the adherence and engagement within these programs,” Mr. Scibelli said.

Rewarding employees if they reach a designated health goal, such as a certain blood pressure level or weight, also has been a popular employer tactic, but the NBGH survey found that employers offering incentives to employees to achieve certain health outcomes fell sharply to 24% this year from 44% in 2015.

Though the survey did not ask why some employers are dropping their outcomes-based approaches, other consultants say they've seen similar trends.

“When we look at ... employers that have an outcomes-based model, we did not see better outcomes,” said Dr. Jeff Dobro, chief medical officer at Minneapolis-based wellness technology firm RedBrick Health Corp. “In fact, when it came to measuring blood pressure in year-over-year cohorts, we saw worse outcomes.”

Employees “didn't like the fact that they were forced to have certain outcome numbers,” Dr. Dobro said.

“Dinging (employees) because they don't hit those numbers may or may not be the best motivation,” Optum's Mr. Serxner said.

While NextEra also gives workers financial incentives for meeting specified health outcomes, Mr. Scibelli says he's weighing “whether or not we continue to move forward” with outcomes-based strategies that are difficult to administer and turn some employees off.

For Interactive Health's Ms. Nevara, the emphasis should be on driving participation: “Health outcomes is the thing that (employers) are trying to solve, and the only way they are going to have this paradigm shift within their organization is if they get the majority to participate.”

Oak Brook, Illinois-based stainless steel sink maker Elkay Manufacturing Co. combined participation and outcomes-based incentives. Its employees get $500 off medical premiums for undergoing a biometric screening and health risk questionnaire, said Carol Partington, Elkay's employee benefits and compensation manager.

Based on the evaluations, employees are given a health-related goal. Employees who do so by the next year — aided by telephonic and online coaching in areas such as exercise, sleep, tobacco cessation and nutrition — get another $800 toward the medical premium for a total possible reduction of $1,300.

It worked. Last year, 2,442 of Elkay's nearly 3,000 workers took the health evaluation, up 11% from 2014. And 72% who got a biometric screening met their goal.

“We'll give you these tools to help you be successful on your journey, but you need to put something into it as well,” Ms. Partington said. “That's why these resources work, because then these employees bring forth that effort, and then they are further rewarded.”

“There's always been this debate: Do incentives drive engagement?” said Pam Mortenson, Omaha, Nebraska-based executive vice president of wellness solutions at Health Advocate, a health care advocacy and assistance company. “But are (employees) engaging to get their incentive ... (or) is it really driving lifestyle and behavioral changes?”

That's why “it's important that an employer really does gain an understanding of their culture, and what excites people within the business. And having a flexible program is really important, and having different options to choose from to keep that employee engaged. And hopefully it does start to drive lifestyle behavior changes,” she said.

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