Some employees object to carrot-and-stick approach on insurance rates, saying it’s based on factors out of their control.
Marjorie Saporu is one reason why employers are starting to reward workers based on their health.
When the administrative assistant learned her blood pressure prevented her from receiving a maximum break on her company’s health insurance, she took steps to reduce anxiety, cut out bad foods and started taking strolls through the Midtown Global Market adjacent to her office at Allina Health. Limited by osteoarthritis, the 56-year-old also learned how to strengthen her knees by simply rising from her office chair without using her hands and then doing a series of squats.
The quirky routine gets her some strange looks, but she just responds, “I’m doing my physical therapy.”
A growing number of companies are awarding — or are thinking about awarding — financial incentives to workers who can show “biometric outcomes” for getting healthy. They’ll give gift cards or reduced health payments to workers who lower their blood pressure, lose weight or stop smoking.
Incentives based on personal health are the latest twist in workplace wellness programs that emerged a decade ago to rein in the skyrocketing cost of health insurance. But the approach is controversial, stirring opposition from those who don’t believe it is fair to base financial rewards on health problems that can be beyond workers’ control.
A union representing 350 workers at a group of Allina clinics, for example, has made fighting the program its top priority.
Traditional incentives have tied rewards for workers to participation in wellness programs. Attend a session on healthy living, get a gift card.
Complete a health questionnaire and get a price break on the company health plan.
New data released this past week from the Kaiser Family Foundation’s annual survey of employers show this remains the most common approach. Only 55 percent of large employers with wellness plans even offer biometric testing of patients’ weight, blood pressure, cholesterol or other measures, and only 10 percent of those employers use the results to reward or penalize workers, according to the Kaiser data.
But that could change soon. A separate survey by the Towers Watson consulting firm found that nearly half of employers were considering switching to wellness incentives based on biometric outcomes for 2014 or 2015.
That shift is coming because rewards based on participation only “just aren’t achieving the sort of returns that you’d like,” said Jeff Zwiefel, an executive vice president for Life Time Fitness.
The Minneapolis company, known mostly for its fitness clubs, has bet on the movement toward outcomes-based incentives with a program called myHealthScore, which assigns scores on a 100-point scale to workers based on biometrics testing. Allina, Dakota County and six other employers use the scoring system, which determines the level of reward their workers receive.
Kind of like car insurance
Zwiefel said a system that distributes rewards based on fitness makes sense and is akin to auto insurance.
“If you have a ticket with auto insurance,” he said. “Your rates go up.”
The approach worked for Saporu after her first screening in 2012 left her with only a partial discount on her workplace health insurance in 2013. Through all of her efforts, Saporu lowered her systolic blood pressure 13 points and she qualified for the maximum benefit — a $1,014 credit on her insurance premium — in 2014.
Her score isn’t perfect. She’s still overweight, but she is motivated to try to improve that as well by walking 6,000 steps a day and managing her osteoarthritis so she can stay active. Maintaining the financial incentives are at least a part of the motivation, she added.
“By doing it this way, they made it a lot more meaningful,” she said, “because it is related to your health and you have some accountability.”
Not everyone at Allina agrees. SEIU Minnesota is fighting Allina’s proposal to add the wellness system to the contract for 350 nurses and others who work at the former Aspen clinics that merged with Allina. Licensed practical nurse Bridget Lundquist said it is unfair to workers who might be the picture of health but have family histories of high cholesterol or other problems.
“They could be marathon runners — never smoke, never drink — and they still can’t fit into the mold,” she said.
The union would prefer a system by which the rewards are uniform and based on the collective health of the workforce. At the same time, Lundquist acknowledged that it would motivate her to improve her health if income was on the line.
“If I knew that if I didn’t lose weight, or whatever, that it would cost me $100 a month, yeah, it would,” she said.
Do they work?
Whether these types of incentives result in meaningful improvements for workers is unclear, though. RAND Corp. published an in-depth study of workplace wellness programs — including five companies with incentives based on workers’ health — and found no such evidence. Workers at one company said the incentives were the “tipping point” in getting them to quit smoking, while workers at another company felt they were insufficient and that people needed an inner drive to make major lifestyle improvements.
The RAND study did find that incentives based on worker health indeed inspired workers to exercise more, lose weight and stop smoking. But the average weight loss was negligible — less than a tenth of a pound per worker.
The absence of clear data has kept some employers from committing to these incentives, along with fears about violating privacy or labor laws if they asked or required workers to conduct health tests.
The federal Affordable Care Act clarified that these types of health-based incentive programs are permissible, but also required that by 2014 workers have the chance to appeal or find alternative ways to achieve the maximum benefits. For example, pregnant workers shouldn’t be compelled by employers to lose weight.
Some employers worry about alienating workers, even if the approach is more effective than a gift card for participation in a health class, said Kristin Van Busum, a co-author of the RAND study.
“A lot of [employers] don’t want to get into that because they don’t want to be seen as this penalizing system,” she said. “They want to kind of play it safe.”
Employers need to make sure workers are interested in the incentives and feel they address their health concerns, or they can be counterproductive, said Jean Abraham, an associate professor at the University of Minnesota who studies workplace wellness programs. “If they see this to be potentially punitive in some regard, they will push back.”
The U’s wellness system asks workers to complete biometric testing. Premium discounts are not based on the results, but rather whether workers complete the testing, as well as fitness sessions or other programs.
Allina has already adjusted its two-year-old program in an effort to be fair. In 2012, only employees with top health scores qualified for financial benefits. Spouses received benefits as long as they completed the biometric tests.
This year, all workers and spouses who complete the screening would receive some benefit — but the amount varies by their scores.
“There were some people who felt like, ‘Why should I even do it? I don’t expect I’m going to get a good score,’ ” said Jodi Morris, an Allina benefits manager. “We really wanted to get everybody involved.”
Workers can now get the maximum benefit even with a single health problem — such as high body fat, cholesterol or stress. Additional health concerns lower their scores further and their benefits correspondingly decline way down to $182 per year for workers with poor health. The only employees and spouses who receive nothing are those who don’t complete the screening or union workers who haven’t agreed to these incentives.
Better than gift cards
Saporu said the current reward system is better than Allina’s old system, which granted gift cards if workers attended health sessions.
“I wanted to learn this stuff, but I felt like I was one of the few people that did,” she said. “Everybody else was just like, ‘Give us our gift card.’ ”
Experts agree that financial incentives have limits. They might get people to try healthy behaviors, but the hope is that workers will feel the difference in their health and make permanent changes, said Matthew Nyquist, Life Time’s vice president for corporate health.
“It’s about changing habits, about changing behaviors and changing people’s lives,” he said. “Once people live healthier, that is what reduces health care costs.”
Jeremy Olson • 612-673-7744