Consumer Comeback Blog

More Employers Offer Monetary Incentives for Good Health

Workers committed to getting in shape, quitting smoking, and otherwise improving their health may find a little extra cash in their pockets. A recent Aon Hewitt survey said U.S. employers are putting their money where their mouth is by rewarding employees for living healthier lifestyles.

The survey of nearly 2,000 employers who have a collective 20 million Americans on the payrolls, revealed that employers are providing more incentives for employees to take better care of themselves, with 84% offering incentives just for employees to complete a health risk questionnaire, 64% offering incentives for biometric screenings and 51% offering incentives for participating in health improvement and wellness programs.

Rewarding employees for better health is on the rise, the survey showed. In 2011, 37% of employers surveyed offered their employees cash, discounts and other monetary motivators to participate in wellness and health improvement programs, but that jumped to 59% in 2012. Incentives for participating in disease management such as blood pressure, blood sugar and cholesterol programs tripled in 2012 from 17% in 2011 to 54% in 2012.

“Employers know that eight health behaviors, including risks such as lack of physical activity and failure to complete recommended preventive screenings, drive 15 chronic conditions that lead to higher medical costs and increased absence from work. An effective incentive strategy rewarding those who take action to improve their health is fundamental for improving health and reducing cost,” Stephanie Pronk, clinical health improvement leader for Health & Benefits at Aon Hewitt said in a press release.

Participation in health risk questionnaires and disease management programs have also become a requirement for some employees to be enrolled in value-based insurance programs. To receive enhanced benefits, nearly one third of employers who offer these type of insurance plans require employees to participate in disease management, smoking cessation programs. That is 33% more than 2011, when only one in ten employers had those requirements.

“Programs and tools like HRQs and biometric screenings can make employees more aware of their health status and of the opportunities to improve their health, but alone they won’t move the needle when it comes to health improvement and mitigating cost,” Jim Winkler, chief innovation officer for Health & Benefits at Aon Hewitt, said in a press release. “Incentives solely tied to participation tend to become entitlement programs, with employees expecting to be rewarded without any sense of accountability for better health. To truly impact employee behavior change, more and more organizations realize they need to closely tie rewards to outcomes and better results rather than just enrollment.”