Several leading health care advocacy groups are helping advance the use of outcomes-based incentives in worksite wellness or health management programs that are encouraged by the Patient Protection and Affordable Care Act.
The guidance, published in the July 13th issue of the Journal of Occupational and Environmental Medicine, is intended to help ensure that worksite wellness programs using such incentives are effective and fair to all employees and improve health results. It is unique in that it represents the collaborative thinking of six well-respected organizations with diverse stakeholders.
Recognizing the need for best practices as incentives tied to outcomes become more commonly used, the organizations compared their varying approaches and opinions in order to identify key areas of consensus.
The guidance incorporates research, practical application, policy perspectives and a set of basic considerations for employers seeking to maximize the health improvement results of their incentive programs. It also provides protection for employees against discrimination, unaffordable coverage and loss of access to health care.
The participating organizations include the Health Enhancement Research Organization, American College of Occupational and Environmental Medicine, American Cancer Society, American Cancer Society Cancer Action Network (ACS CAN), American Diabetes Association, and the American Heart Association.
“Employers play a significant role in influencing the health behaviors of their workforce, and increasingly, they realize that a healthy workforce can reduce health care costs, disability and absenteeism, while increasing productivity,” said Jerry Noyce, president and CEO of the Health Enhancement Research Organization. “As employers seek new ways to engage employees in programs that change health behaviors, their interest in outcomes-based incentives has grown considerably, as has the need for a unified voice on the issue.”
Nancy Brown, CEO of the American Heart Association, said “workplace wellness programs can provide the tools and opportunities to improve health and wellness, but they should not be used in ways that undermine an employee’s ability to obtain adequate and affordable health insurance coverage. By following this guidance, these unintended consequences can be avoided.”
Outcomes-based incentives are a relatively new incentive design in which employees receive a financial reward for meeting a specific health outcome, or a penalty may be imposed for failure to meet a health standard. While the ability of outcomes-based incentives has not been well researched or documented, the impact of incentives linked to participation in wellness programs has been demonstrated by leading researchers as a means to increase employee participation.
The sponsoring organizations stress that the new guidance is not meant to advocate for an outcomes-based incentive approach over a variety of other strategies for increasing employee engagement in wellness programs.
“Incentives can be an effective way to motivate some employees to participate in workplace wellness programs and to begin behavior changes,” said Larry Hausner, CEO of the American Diabetes Association. “If not implemented carefully, however, incentives can also operate as penalties – imposing financial or other burdens on employees which may be counterproductive. One of our goals with this paper is to provide a framework for helping employees make healthy lifestyle changes while providing adequate protection and accommodation for those with disabilities and other barriers.”
For example, workplace culture is one of the keys to a successful worksite wellness program. A workplace culture that supports healthy behaviors is one of the proven best practices for effective and sustained improvements in employee health. Other best practices include preparing a strategic plan to guide and support company wellness goals, developing a risk assessment and screening program, as well as behavioral intervention programs, employee engagement strategies, ongoing employee communications, and a commitment to measurement and evaluation.
“Incentives are just one tool employers need to consider when implementing workplace wellness,” said Ron Loeppke, M.D., president-elect of the American College of Occupational and Environmental Medicine, and vice chair of U.S. Preventive Medicine. “To be effective, the incentive strategy must be part of a comprehensive workplace health improvement plan.”
Added Christopher W. Hansen, president of ACS CAN, the advocacy affiliate of the American Cancer Society: “We hope companies will look to this guidance as they consider the expanded workplace wellness incentives allowed under the Affordable Care Act. We believe this blueprint could lead to well-designed programs that effectively improve workforce health by creating a culture and atmosphere that encourages employees to take their own initiative in getting and staying healthy.
“This collaborative will continue to monitor trends and research in incentive design and best practices so the wellness industry, and employers of all sizes, can benefit from our collective experience and thinking.”
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