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AIS's Health Business Daily
Featured Story July 16, 2008 More Employers Move to Integrate Incentives With Consumer-Directed Care BenefitsReprinted from INSIDE CONSUMER-DIRECTED CARE, a biweekly newsletter with timely news and insightful analysis of benefit design, contracts, market strategies and financial results. By Bruce Goldfarb, Editor (bgoldfarb@aispub.com) As growing numbers of employers introduce incentive programs for health and wellness into consumer-directed health (CDH) plans, they are increasingly seeking ways to integrate incentives with health benefits. According to a recent survey by the ERISA Industry Committee and National Association of Manufacturers trade groups and IncentOne, an incentive-program administrator based in Lyndhurst, N.J., more than 70% of 225 major employers offer health and wellness incentives to their employees. "It used to be that a T-shirt or coffee mug moved people to engage in some level of wellness," Sue Lewis, IncentOne's senior vice president of health and productivity solutions, tells ICDC. "Consumers today are definitely looking for more meaningful incentives." Aside from gift cards, premium discounts are among the most common type of incentive offered in health plans, Lewis says. Battle Creek, Mich.-based Kellogg Co., with 17,000 employees, introduced a CDH plan with a health reimbursement arrangement (HRA) in 2004, according to company spokesperson Stephanie Slingerland. In 2007, Kellogg launched an incentive program that provides up to a $180 reduction in annual health benefit premiums for completing a health risk assessment, and an additional $180 reduction for participating in a smoking-cessation program, for a total of $360 annually. During its first year, 66% of eligible employees completed a health risk assessment, and 54% of those in a smoking-cessation program remained smoke-free, according to IncentOne data. Motorola, the electronics giant based in Schaumburg, Ill., is another company with CDH benefits that offers health and wellness incentives to its 66,000 employees. Employees who participate in a health risk assessment and meet with a coach to reduce health risks can have up to $250 annually deposited into their HSA, according to Lewis. ThedaCare Health System, an integrated system based in Appleton, Wis., has an incentive program that includes a $25 discount on monthly health insurance premiums and additional incentives and gifts for reducing health risks. Investing in health and wellness incentives can pay off in reducing health care costs. Lewis says that more than 80% of employers surveyed report a positive return on investment. Incentives May Violate Laws Despite the advantages, an incentive program is a double-edged sword. If not properly designed and legally vetted, incentives may violate a variety of state and federal laws, including the Americans with Disabilities Act. In addition, several states prohibit premium discounts under anti-kickback laws. "Anybody who
implements an incentive program needs to be mindful of discrimination
laws, regulations regarding HIPAA and all sorts of tax regulations,"
Lewis says. Employers and health plans considering an incentive program
should consult their legal counsel to make sure the proposed program
is in compliance with state and federal laws, she adds. |
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