Employer wellness programs and the Affordable Care Act (ACA) are both highly debated topics on their own, but employers are also discussing the links between the two and what that means for the design of their wellness benefits.
First, let’s take a step back and refresh what we already know about the ACA, which aims to provide Americans with access to quality and affordable health insurance. In addition to employer requirements to offer health care insurance to their workforces, it encourages employers to offer wellness programs designed to improve health and prevent disease.
Employers should be aware of the rules that help shape wellness program design and incentives. To remain compliant, employers need to know the difference between health-contingent wellness programs and participation-based programs.
- Participation-based programs: Incentives offered to similarly situated employees who participate in a wellness program, such as a health risk assessment. These programs are about participation, not obtaining a specific outcome.
- Health-contingent, activity-only: Incentives offered for completing an activity wherein an employee’s ability to participate may be limited due to a health factor. In this case, employers may ask for physician verification that it is unreasonably difficult or medically inadvisable for an individual to participate in an activity prior to granting an alternative standard.
- Health-contingent, outcomes-based: Incentives are offered for attaining or maintaining a specific health outcome, such as being tobacco-free or having a healthy blood pressure. The ACA states that alternative means must be offered, without physician verification/ note, to an individual who does not meet the target outcome.
The ACA provides guidance on basic design to ensure that programs are not discriminatory. Additional rules, proposed by the Equal Employment Opportunity Commission (EEOC), are pending to clarify the Americans with Disabilities Act’s (ADA’s) position on the wellness regulations. Additional rules related to the Genetic Information Nondiscrimination Act (GINA) are also pending. Such regulations also help ensure employees that their health information is protected. The more transparent you are in your communications about privacy and the value of these efforts, the more likely you are to gain followers.
That said, a solid design with an attractive incentive isn’t necessarily the magic bullet for wellness program participation. A bigger driver of positive change and sustained wellbeing in an organization is its culture. According to a Gallup poll, employees who have strong overall wellbeing are twice as likely to be engaged in their jobs compared to employees with moderate wellbeing.* And, highly engaged business units boast a 37 percent decreased absenteeism, 25 percent lower turnover and 22 percent higher profitability. We know that high engagement plus high wellbeing yields the best results; let’s reframe the conversation around this value of an investment in wellbeing programs rather than narrowly focusing on ROI.
Be sure to brush up on the laws so you can clearly communicate the scope of your wellness program to employees in order to ease their concerns about participating. At the same time, remember to create a greater value proposition in your message. Rather than center the call to action around the reward or penalty at stake, emphasize the end goal of working together to create a culture of wellbeing and engagement, which ultimately solves the problem of rising risks and costs.
*Gallup (2013), “State of The American Workplace: Employee Engagement Insights for US Business Leaders”