Wellness, Health Management Programs Still "Fit" at Most Employers

April 15, 2009 (PLANSPONSOR.com) - Despite the recession and recent cutbacks in some benefit programs, companies continue to add wellness and health management programs to promote healthier behaviors among their workers.

Additionally, companies are finding greater success by offering workers financial incentives for participation in these programs, according to a survey by Watson Wyatt, a global consulting firm, and the National Business Group on Health (NBGH), an association of more than 300 mostly large employers. Moreover, due to recent events affecting the economy and financial markets, most respondents either have changed or plan to change their health care strategy (60%).

Key Findings

The 14th Annual National Business Group on Health/Watson Wyatt Employer Survey on Purchasing Value in Health Care details current trends and best practices in employer-sponsored health care benefit programs. Among its key findings:

  • Annual median cost increases for health care including plan changes have reached a plateau at 6% in 2007 and are expected to remain at this level through 2009. Without plan changes, average trends would have been 8%, according to the report.

  • Best-performing companies – those with a median two-year average cost increase in the lowest quartile among all respondents – have a median two-year trend of 0.5%. According to the report poor-performing companies – those in the highest quartile – have a cost trend of 10.5%.

  • Today, just over half of larger employers (51%) percent of companies have a consumer driven health plan (CDHP) in place, up nearly 9% from a year ago. Enrollment rates in CDHPs are also increasing at a pace of two percentage points per year, according to the report, though that takes it to just 12% in 2008.

Employer interest in programs that promote a healthier workforce continues to increase, the survey found. For example, nearly six in 10 companies (58%) offer lifestyle improvement programs, compared with 43% in 2007, while 56% offer health coaches compared with 44% in 2007.

The number of weight management programs is also on the rise, offered by 52% of companies, up from 42% in 2007. Also, health risk appraisals are offered by 80% of companies, up from 72% in 2007, according to the survey of 489 large U.S. employers conducted in January.

"Employers continue to see gains from promoting wellness and health management initiatives," said Scott Keyes, senior group and health care consultant at Watson Wyatt. "Effective financial incentives are one of the keys to encouraging worker participation in these programs - an effort that not only improves the health of workers but also helps reduce costs."

Incentives Ayed?

Companies that offer financial incentives report significantly higher participation in lifestyle management and wellness programs, according to the survey. However, employee participation in some wellness programs remains low. For example, 40 % of companies report that less than 5% of their workers participate in weight management programs.

Incentives for health risk appraisals are on the rise, offered by 61% of employers, up from 53% last year. Other programs that frequently offer incentives to encourage use include those for:

  • smoking cessation (offered by 40% of employers in both 2008 and 2009),
  • weight management (offered by 34% of employers, up from 31% in 2008) and
  • full coverage of preventive services (offered by 73%, well up from 53% last year).

According to the survey, even moderate incentives can help engage employees in healthy behaviors. Financial incentives between $51 and $100 can boost participation in smoking cessation and weight management programs and encourage workers to get biometric screenings. Higher participation in health risk appraisals is associated with incentives greater than $100. However, financial incentives have limited impact on participation in disease management programs, according to the report.

To view the 14th annual NBGH/Watson Wyatt report, visitwww.watsonwyatt.com/2009nbghsurvey