How Employers Are Designing Wellness Programs

Making a physical wellness program successful starts with educating employers about their options and responsibilities, and the opportunities available to them, a report from United Benefit Advisors says.

Most industry experts agree that employee education is the most critical component to making a wellness program successful. However, United Benefit Advisors (UBA) finds it starts with properly educating employers about their options, their responsibilities, and opportunities available to them.

For this reason, UBA has issued a report about how employers use physical wellness programs.

UBA says many employers are unaware there are wellness options available within their current benefits package. “A basic first step that many employers are starting to provide, is incentives for employees to get their physical exam, which is often covered at 100% as part of their medical benefits,” says Les McPhearson, CEO of UBA.

The firm’s research found that 18.4% of all employers offer comprehensive wellness programs, virtually unchanged from last year. As one might expect, the highest percentage (60.3%) of plans offering wellness benefits came from employers with 1,000 or more employees. The next two largest percentages—51.1% and 35.6%—came from organizations with 500 to 999 employees and 200 to 499 employees, respectively.

Small employers with fewer than 25 employees—already the least likely to have wellness programs—have seen a 34.4% decrease in wellness program offerings in the last three years (going from 9.3% to 6.1%).

Larger employers tend to turn to independent wellness program providers versus carrier programs, with 63% of employers with 500 to more than 1,000 employees preferring independent programs. Small employers (fewer than 25 employees) overwhelmingly (more than 90%) use carrier-provided programs, likely due to their low or no cost features when bundled with the health plan.

NEXT: Incentives and EEOC regulations

According to UBA, 67.7% of employers who offer wellness programs have incentives built into the program, an increase of 8.5% from four years ago. Major lawsuits are pending against employers with particularly robust wellness programs and the regulatory environment is becoming increasingly restrictive. As a result, employers are continuing to pursue wellness programs, but they are being very cautious with program design, avoiding implementing high penalty and incentive programs.

Across all employers, slightly more (45.4%) prefer wellness incentives in the form of cash toward premiums, 401(k)s, flexible spending accounts (FSA), etc., versus health club dues and gift cards (40%). But among larger employers, 500 to more than 1,000 employees, cash incentives are more heavily preferred (63.2%) over gift certificates and health club dues (33.7%). Conversely, smaller employers (1 to 99 employees) prefer health club-related incentives (nearly 40%) versus cash (25%).

Employers are beginning to use the regulations from the Equal Employment Opportunity Commission (EEOC) as their guidelines for program development, and the wellness guide provided by the Patient Protection and Affordable Care Act (ACA) have re-empowered employers to implement premium differentials for wellness participation and cessation of tobacco use. However, many are likely wary of the EEOC’s new guidance regarding wellness programs that include health risk assessments, biometric screenings, and medical exams. How those regulations influence plan design remains to be seen.

NEXT: Wellness program design

Among employers offering wellness programs, 72.5% include health risk assessments, 67.7% offer employee incentives for participation, 67% offer biometric screenings or physical exams, 54.6% include on-site or telephone coaching for high-risk employees and 38.8% include seminars or workshops. The use of health risk assessments continues to decrease, dropping 10.5% in three years. Compared to 2015, telephone coaching for high-risk employees is up 7.5% and seminars and workshops are down 8.5%.

Sierra Sullivan, assistant population health strategist at LHD Benefit Advisors, a UBA partner firm, says, “Including a biometric screening or physical exam as part of a comprehensive wellness program can be beneficial for both the employer and employees. Through a biometric screening or physical exam, key health indicators related to chronic disease can be measured and tracked over time, including blood pressure, cholesterol levels, blood sugar, or body mass index (BMI). For employees, this type of data can provide real insight into current or potential health risks and provide motivation to engage in programs or resources available through the wellness program. Beyond that, aggregate data collected from these types of screenings can help employers make informed decisions about the type of wellness programs that will provide the greatest value to their company, both from a population health and financial perspective.”

UBA’s research found that for those identified as high risk or diagnosed with a chronic condition, wearable devices have proven useful in managing ongoing care. According to Kaycee Eaton, assistant population health strategist for LHD Benefit Advisors, “Wearable devices provide real-time data and promote self-management for chronic conditions. Self-monitoring blood glucose meters and blood pressure monitors have been around for a while, but with the ability for the data to automatically upload to a smartphone app or website, it can help drive health outcomes. These programs can provide instant feedback, track patterns, show progress, and can be easily shared with a health care provider.”

More results and information about the survey may be found here.