80% of US employers are using financial incentives in wellness programs, and Penn Medicine research suggests better incentive design is needed to get people to exercise

In recent years, there’s been plenty of headlines about wellness programs offered by employers and health insurers. Data show that such programs are cost-effective. But, until now, there were few studies about employees’ attitudes toward wellness programs. Because some of these wellness programs incorporate clinical laboratory testing, medical labs have a stake in their future.

The fact is that companies want healthier employees and they’re willing to pay for it. Experts say about 80% of US employers use financial incentives in worker wellness programs. And for each dollar a company spends on a wellness program, it saves about $3 in medical costs, according to an article the journal Health Affairs.

Wellness Programs and Clinical Laboratory Test Referrals

But do wellness programs resonate with employees? How effective are they, really, in improving participants’ healthy habits? And what affect will increased participation have on the volume of test referrals made to clinical laboratories and pathology groups?

Surveys completed over the past 12 months have investigated how appealing rewards programs are to workers, and how effective they are in motivating people to adopt healthier lifestyles.

One such survey revealed that cash rewards made by employers are indeed welcomed by most employees. The survey was conducted by Welltok, a consumer health enterprise Software as a Service (SaaS) company located in Denver that designs personalized action plans to connect consumers with available and relevant benefits, resources, and rewards; and by the National Business Group on Health. A Welltok statement said the survey found rewards to work for all employees, regardless of their income or age.

An article published in the American Journal of Managed Care noted that among those surveyed about employer wellness programs:

• 81% of participants reported “positive impact” on their wellbeing;

• 60% said they would increase their participation if families were included; and

• 91% said rewards would motivate them to adopt healthier behaviors.

Additionally, “86% of respondents rated their colleagues as one of the top motivators to improving their overall health and wellbeing at work, followed by their direct manager (57%). Millennials were more likely to be influenced by their direct manager (64%) and less by Human Resources (24%); older employees (55+ years) were less motivated by direct managers (51%) and more influenced by HR (40%).”

Among those who did not participate in the programs, 37% said they did not find them “personally relevant” and 20% were not aware of the programs.

Insurers Use Rewards to Encourage Members’ Healthy Behaviors

Welltok offers the CaféWell Health Optimization Platform to health plans that are looking to guide and incentivize consumers to optimal health. The platform enables organizations to effectively target, engage and guide behavior, and to help users meet their personal goals, according to the company’s Website.

“Engagement is now the number one challenge facing employers,” said Brian Marcotte, Chief Executive Officer and President of the National Business Group on Health.

In October of last year, Welltok announced a partnership with Highmark, Inc. (the fourth largest Blue Cross and Blue Shield-affiliated company). As part of the collaboration, Medicare Advantage members will get rewarded for healthy actions toward optimizing health through Welltok’s CaféWell platform, a statement explained.

Another Study Compares Cash Rewards to Monetary Penalties

Meanwhile, a University of Pennsylvania (Penn) study, published in the Annals of Internal Medicine suggests financial incentives aimed at increasing physical activity are most effective when rewards were put at risk of being lost.

Researchers at the Perelman School of Medicine (Penn Medicine) designed three different strategies to motivate 281 overweight and obese Penn employees to walk 7,000 steps a day for 26 weeks, a statement noted. A mobile smartphone app enabled the employees to track their progress.

A Reuters article reported that the participants were divided into four groups with different motivation strategies:

• One group lost $1.40 a day from a $42 monthly incentive deposited in an online account for each day they failed to meet the goal;

• A second group received a $1.40 cash incentive for each day they met the steps goal;

• A third group drew lottery numbers for a chance to win $50, collectible if they achieved 7,000 steps on the previous day;

• And a fourth “control” group received no incentives, but did receive feedback on their step total, as did the other groups.

The results showed “loss aversion” was a powerful incentive for motivating change. Following the conclusion of the 13-week study, the Penn Medicine researchers reported that:

• The loss incentive group achieved their daily step goal 45% of the time;

• The cash incentive group met the goal 35% of the days;

• The lottery group met the goal 36% of the days; and

• The control group met their goal 30% of the time.

The researchers determined that people tend to work harder to “retain” something, than they do to “get” something they never had, noted an article in Fortune.

Mitesh Patel, MD (above), Assistant Professor of Medicine and Health Care Management at Penn Medicine, was the lead author of the study that investigated the effectiveness of three different methods to financially incentivize overweight and obese adult workers to increase their physical activity. (Photo copyright: University of Pennsylvania.)

Mitesh Patel, MD (above), Assistant Professor of Medicine and Health Care Management at Penn Medicine, was the lead author of the study that investigated the effectiveness of three different methods to financially incentivize overweight and obese adult workers to increase their physical activity. (Photo copyright: University of Pennsylvania.)

“About 80% of employers in the US use financial incentives of some kind in wellness programs. For most employer wellness programs, you do something, you get paid for it—sometimes relatively soon, sometimes off into the future,” said Mitesh Patel, MD, Penn Medicine Assistant Professor of Medicine and Health Care Management, and the study’s lead author, in the Reuters article. “I think the evidence is clear—these financial incentives could be better designed if they were based on insights from behavioral economics.”

According, though, to Soeren Mattke, Managing Director of the RAND Corporation’s Health Advisory Services, implementing programs that take money from workers can be tricky for employers.

“From an employee relations perspective, penalties have a bad aftertaste. It’s much easier to tell people, ‘We’ll give you $10 extra if you join the wellness program,’” Mattke stated in a HealthDay article.

Will Labs See Healthier People?

For pathologists and clinical laboratory leaders, it’s important to note that corporate wellness programs are growing in number and sophistication. Mobile applications that enable employees to track healthy behaviors are becoming commonplace and more powerful. And technology platforms such as Welltok’s CaféWell enable employers and insurers to organize health improvement and condition management resources.

Time will tell if the programs and their incentives pay off in bringing a healthier population to medical laboratories.

—Donna Marie Pocius

Related Information:

Workplace Wellness Programs Can Generate Savings

Employees Report High Satisfaction with Health and Wellbeing Programs, but More Personalization is Needed

Employees Have Positive Attitudes Toward Workplace Wellness Programs, but Participation is Low

Highmark Partners with Welltok to Close Gaps in Care and Improve Community Health among Seniors

Framing Financial Incentives to Increase Physical Activity among Overweight and Obese Adults

To Encourage Physical Activity, Potential to Lose a Financial Reward is More Effective than Gaining One, Penn Study Shows

For Fitness Motivation, Losing Money Beats Earning More

How to Actually Motivate Employees to Exercise

Sticks, Not Carrots, May Work Best to Boost Employees’ Health

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