Wellness programs are “in” for employers – and so are penalties for workers who make unhealthy choices.
Over the next three to five years, 73% of employers said they’ll offer a wellness program and tie incentives or penalties to it to motivate their employees to make healthy choices, found a 2011 Aon Hewitt survey.
Carrot v. stick
Currently, the penalties appear to be getting a stronger foothold in companies’ wellness strategies.
Reason: Many businesses have found in their wellness programs that people are more motivated by the risk of losing money than gaining it.
How many companies operate under that belief? Here’s a rundown compiled by a 2010 Aon Hewitt survey:
- 64% of employers impose or plan to impose penalties for smoking
- 50% for not taking part in disease management/lifestyle behavior programs
- 45% for not participating in biometric screenings
- 25% for not consulting with health coaches, and
- 17% for not making biometric improvements, like lowering blood pressure or losing a set amount of weight.
2 things to remember
When it comes to offering incentives or penalties, there are two things employers need to remember to avoid breaking the law:
- The size of any incentives or penalties in a wellness program can’t exceed 20% of the total cost of health coverage for employees (in 2014 that limit will be bumped up to 30%, thanks to the healthcare reform law), and
- If an employee is unable to earn an incentive — or avoid a penalty — due to a health condition, the wellness program must create an alternate way for that employee to do so.