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The number of major U.S. employers offering incentives to promote employer-sponsored health and wellness programs rose nearly 10 percent from 2007 to 2008, according to a recent national report.

The report finds the number of companies offering workers wellness incentives increased from 62 percent last year to 71 percent this year, says Katherine Herring Capps, one of the study’s lead authors and president of Health2 Resources, a Vienna, Va.-based health-care consulting firm.

The study, released in June, was conducted on behalf of the ERISA Industry Committee (ERIC) and the National Association of Manufacturers (NAM), both based in Washington, D.C., as well as Lyndhurst, N.J.-based IncentOne Inc.

Not only are more employers providing incentives, but more are also offering wellness programs to help achieve results, according to Capps. In the inaugural study, 72 percent of employers surveyed were using formal health and wellness programs. A year later, the figure has increased to 77 percent, the survey finds.

“You’re looking at well over three-out-of-four employers are using formal health and wellness programs to invest in their health of their employees,” Capps adds.

More than half of those employers currently without programs plan to add them.

In 2008, 48 percent of employers offer formal disease-management programs, about the same percentage as in 2007, the report finds.  Because there is such an increase in the use of incentives, one of the study’s objectives was to find out how they’re being offered and in what numbers, she says.

“It’s tough to change people’s health behavior, and cash is the way to do it. And that cash may be represented in a gift card,” Capps says.

The use of gift cards as an incentive increased from 17 percent of respondents in 2007 to 28 percent in the 2008 report, making it the top incentive choice among the employers surveyed.

Reductions in health-insurance premiums, provided by 26 percent of respondents, and cash bonuses, given by 24 percent, are other options, although survey results show a decline from 2007, as they’re now second and third respectively behind the gift-card option.

The research also aimed to find out when employers are offering the incentives, and participation seemed to be the key, says Capps. Nearly 40 percent of employers offered incentives when their workers completed a program or a health-risk assessment, as opposed to just participating.

A smaller figure, 16 percent, offered the incentive for achieving a program goal, such as weight loss or quitting smoking.

As for how much is being spent on these incentives, the study found employers are typically earmarking between $100 and $300 per employee per year.

The average amount an employer pays is about $192 per person annually, according to Capps, who adds, “…if you have 500 employees, that’s a pretty significant amount of money to invest in the health of their work force.”

The survey also examined if the incentives are worth the money being spent.

The report says the proportion of those companies with programs successfully measuring return on investment (ROI) increased from I4 percent in 2007 to 26 percent in 2008. Among those respondents, more than 83 percent estimated an ROI greater than break-even in 2008, up from 66 percent in 2007.

The web-based survey of 225 major U.S. companies was conducted between April and May. The sample came from the membership of ERIC and NAM.

ERIC represents the employee benefits and compensation interests of America’s major employers, such as Wal-Mart. NAM advocates on behalf of small, medium, and large-sized manufacturers.

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This entry was posted by Adam V. Russo on Friday, October 17th, 2008 at 1:24 pm and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.