The ideal corporate wellness program brings together employees from different backgrounds and helps them focus on making choices that lead to longer, healthier lives. The challenge is working through those differences to arrive at a plan that allows everyone the best chance to participate and achieve their own individual goals.
Workplace wellness programs often incorporate incentives or rewards to promote healthy lifestyle choices and discourage behaviors that are detrimental to employees’ good health. If the program relates to a group health plan or is linked to a health factor, it must comply with the nondiscrimination rules of the Health Insurance Portability and Accountability Act, as well as new guidelines spelled out in the Affordable Care Act (ACA).
These rules allow employers to provide incentives or rewards as part of a health-contingent wellness program, provided the program follows certain guidelines, says P.J. Insana, a partner at Britton Gallagher.
Smart Business spoke with Insana about these legality issues and how they affect the design of a corporate wellness program.
How does the ACA classify corporate wellness programs?
Under the ACA, workplace wellness programs can be divided into two general categories: participatory wellness programs and health-contingent wellness programs. This distinction is important because participatory wellness programs are not subject to the same restrictions on incentives or rewards that apply to health-contingent wellness programs.
That’s where the design of the program is so important. What’s your commitment to this wellness plan and to the overall health and wellness of the group? You need to keep that goal in mind, especially when you have employees of different ages and health conditions.
That’s not to say that every employee needs to give his or her consent in order to initiate a company running program. But a company-sponsored wellness initiative does need to be fair and provide opportunities for everyone to get something out of it, if they choose to participate.
What’s a good starting point when designing a wellness program?
A health assessment is an ideal place to begin. Take an overall measurement to check in on the health and wellness of your group and learn where your team might be falling short. As you do this, be cognizant of privacy guidelines. You can’t just say you’re overweight, you should stop smoking or you should get more exercise. Work closely with your HR department and your benefits provider or consultant to develop a strategy that is appropriate.
What incentives are available to employees?
Often, when you start talking about a new initiative, there is immediate resistance and skepticism that you are trying to take something from your employees. Make it clear that you want to give incentives such as gift cards, time off or even discounts on medical premiums.
One thing to keep in mind, however, is the impact of the ACA on incentives. The ACA increases the maximum permissible reward under a health-contingent wellness program from 20 percent to 30 percent of the cost of health coverage, and further increases the maximum reward to as much as 50 percent for programs designed to prevent or reduce tobacco use.
What’s at stake financially?
There is no question that claims are driving the cost of health care. If 80 percent of a consumer’s health care expenses occur in the last 20 percent of their working lifetime, you can tell where the claims dollars are going to start accumulating. If you haven’t begun a program to promote health and wellness, your claims are going to escalate pretty quickly. Your benefits consultant or service provider is used to working with clients to develop strategies to implement wellness programs. The cost and the return on investment are important variables in this process.
If the cost of your program is prohibitive and you don’t have a lot of participation, it’s not going to be very cost-effective. Find someone who has your best interest in mind, someone who will hold you accountable and push you to meet your goals and earn that strong ROI. ●
Insights Employee Benefits/Risk Management is brought to you by Britton Gallagher
