January can seem to be like a time for new beginnings-after holiday festivities, many people resolve to workout more, eat better, reduce stress, look after a nagging health concern, or else take care of themselves. In recent years, many employers have provided workplace wellness programs that might help employees stick to these resolutions, for example benefits, services, or financial incentives that encourage workers to improve their own health. CHIR experts previously discussed these wellness programs, but the recent publication of KFF's 2022 Employer Health Benefit Survey, which found some notable alterations in workplace wellness programs, has prompted us to take a brand new look.
What are “Wellness Programs”?
Workplace wellness programs offer a range of health-promoting services and activities, for example nutrition counseling, exercise classes, biometric screenings, lifestyle coaching, flu shots, along with other activities intended to encourage employees to alter their health-related behaviors and lower their own health risks. Oftentimes, employers go beyond offering these types of services and activities and employ financial incentives for example cash rewards, gift certificates, and discounts on health plan premiums or cost-sharing to boost employee engagement. Employers can deploy these incentives via participatory wellness programs, rewarding employees for participating in activities for example attending a category or completing a screening, in addition to “health-contingent” wellness programs, which link financial rewards to achievement of specified health targets, for example Body Mass Index (BMI), cholesterol, and blood pressure. These financial incentives can total as much as 30 percent from the cost of individual coverage, or as much as 50 % if the incentive is tied to a tobacco cessation program. Employers who offer these programs often purchase their wellness programs through an independent vendor or through their insurance provider, to the tune of $8 billion annually.
Wellness Programs in the COVID Era
In the first months of the COVID-19 pandemic, workplaces and gyms closed their doors, group health education and nutrition classes pivoted to virtual platforms, and usage of preventive services fell significantly. With all this upheaval, the result is that employers reconsidered key elements of the workplace wellness programs for 2022, including their utilization of financial incentives and also the wellness program components they support. To know these dynamics, KFF's 2022 survey specifically probed employers' utilization of biometric screenings and health promotion activities. On biometric screenings, they found that 38 percent of huge firms (a lot more than 200 workers) offered employees the opportunity to complete a screening in 2022, compared to 50 % of huge firms offering this particular service in 2022, while small and large firms reduced or eliminated financial incentives for completing the screening. Similarly, 15 percent of large firms and Five percent of small firms reduced their standards for receiving a financial incentive in health-contingent programs. Even though the proportion of employers offering programs to assist employees slim down or stop smoking, or offering other lifestyle or behavioral coaching, remained steady, half of these lenders made changes for their health promotion programs, for example reducing or eliminating incentives or adding new digital programming.
These changes may specifically reflect the initial circumstances of a global pandemic-and a single year's worth of data does not establish a trend-but a closer look at workplace wellness programs suggests the pandemic may partially explain these program changes. Employers initially established these programs within the belief that these initiatives is needed them control health care spending and, by extension, their health insurance charges. In the 2008 edition of KFF's employer survey, for instance, 44 percent of firms offering health coverage reported that they thought wellness programs effectively reduced their own health care costs-with 68 percent of huge firms reporting this belief. Large firms were also more likely than small firms to employ financial incentives inside their workplace wellness programs. By 2022, employers reported they put more stock in wellness programs' capability to control costs than in narrow provider networks or increased employee cost-sharing.
Lack of Efficacy, Cost Shifting Plagues Wellness Programs
The evidence about whether these programs actually control employees' healthcare costs, and produce a return on employers' investments, however, is decidedly less rosy. Early research was mixed-a 2010 meta-analysis discovered that wellness programs produced savings of $3.27 in reduced health spending for each dollar invested in workplace wellness, but RAND's 2022 examination of wellness programs found these initiatives made no significant effect on healthcare spending or utilization. Newer large-scale, randomized studies, like the Illinois Workplace Wellness Study, haven't found short-term savings in health expenditures or improved health behaviors, employee productivity, or self-reported health status. Similarly, a new longer-term study of a multi-site workplace wellness program found no significant differences between randomized participants and non-participants in healthcare spending and utilization, or alterations in conditions such as diabetes and obesity. Analyses also have shown that savings from health-contingent programs particularly might actually result in shifting health care costs to lower-income workers and workers in poorer health instead of reducing plan spending overall. Some employers also report dissatisfaction with workplace wellness programs-for example, in CHIR's recent assessment of cost-control strategies within state employee health plans, only two of fifteen states with recently-implemented workplace wellness initiatives could attribute financial savings to these programs, with one program administrator noting that their state's participation-based incentive program was “remarkably unsuccessful.”
The Way forward for Wellness Programs is Uncertain
Future developments in workplace wellness programs are hard to forecast. The pandemic is constantly on the provide one type of uncertainty of these programs, and employers may, in response, make further changes for his or her 2022 benefit plans. Simultaneously, the federal regulatory structure is within a holding pattern. Upon taking office, the Biden Administration withdrew proposed Equal Employment Opportunity Commission (EEOC) rules on workplace wellness, which would have formulated new limits on financial incentives for wellness programs that track employees' health data to be able to comply with Americans with Disability Act (ADA) and Genetic Information Nondiscrimination Act (GINA) requirements. The proposed rules, however, might have excepted certain wellness programs offered included in group health plans from all of these new incentive limits (the EEOC proposed four factors for determining whether a health-contingent program could be considered a part of an organization health plan: who can participate, the structure associated with a financial incentives, who offers the program, and whether it is a required element of the plan). The EEOC does not appear to be in any hurry to promulgate new regulations, therefore the nature and scope of recent incentive limits are unknown for the time being.
Given this uncertainty, and wellness programs' poor-or at least uninspiring-results, employers should examine their workplace wellness programs carefully. Employers have other tools available to improve employees' health behaviors, engagement, and productivity and create a corporate culture of health without shifting costs to lower-income employees or over-investing in the workplace wellness industry. Some of these alternatives-such as improved cafeteria menus and informal exercise opportunities-likely rely on a complete return to in-person work. Others, such as vaccination clinics and improved behavioral health and stress-reduction programming within Employee Assistance Programs, could support urgent employee health needs, a vital element of not only a culture of health but to our collective pandemic response.
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