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Boosting Workplace Wellness Programs With Financial Incentives
Alison Cuellar, PhD; Amelia M. Haviland, PhD; Seth Richards-Shubik, PhD; Anthony T. LoSasso, PhD; Alicia Atwood, MPH; Hilary Wolfendale, MA; Mona Shah, MS; and Kevin G. Volpp, MD, PhD
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Boosting Workplace Wellness Programs With Financial Incentives

Alison Cuellar, PhD; Amelia M. Haviland, PhD; Seth Richards-Shubik, PhD; Anthony T. LoSasso, PhD; Alicia Atwood, MPH; Hilary Wolfendale, MA; Mona Shah, MS; and Kevin G. Volpp, MD, PhD
Financial incentives created under the Affordable Care Act can help promote employer wellness programs and support preventive services utilization.
ABSTRACT

Objectives:
Using a large natural experiment among 39 employers, we examined the effect of adding financial incentives to workplace wellness programs. 

Study Design: The 39 study employers used the same national insurer to administer their wellness programs, allowing us to observe preventive and health-promoting behaviors before and after financial incentives were implemented. Fifteen treatment employers introduced financial incentives into their wellness programs over 3 years, providing variation in the start dates, whereas 24 employers did not introduce financial incentives. These incentives were attached to specific health actions, including annual preventive visits, biometric screening, and selected screening services for diabetes, heart disease, and cancer. 

Methods: Using multivariate regression, we examined employees and their adult dependents who had insurance coverage for at least 12 months and were offered a wellness program. Outcomes include utilization of annual preventive visits, low-density lipoprotein cholesterol testing, fasting blood sugar (FBS) testing, and breast, cervical, and colon cancer screens.

Results: Financial incentives increased annual preventive visits by 7.7 percentage points, cholesterol testing by 7.9 percentage points, and FBS testing by 7.1 percentage points (P <.05 for each). Compared with baseline rates, these changes represent significant improvements of 21% to 29%. Increases for cancer screening were smaller: 2.7 percentage points for mammograms and 2.2 percentage points for colorectal cancer screening, which correspond to increases over baseline rates of 5.5% and 7.3%, respectively. We did not detect an impact on cervical cancer screening. 

Conclusions: The addition of financial incentives to wellness programs increases their impact on selected preventive care services. 

Am J Manag Care. 2017;23(10):604-610
Takeaway Points

The addition of financial incentives to workplace wellness programs has a notable impact on whether individuals receive preventive care services. Modest financial incentive programs in workplace settings can be effective; however, individuals who did not receive services in the past year respond less than others. Because targeting financial incentives to selected subgroups is challenging within the Affordable Care Act framework, wellness programs may require additional outreach efforts.
Several strategies have been suggested to promote use of preventive services, including expanded incentives and greater involvement of employers.1 Under the Affordable Care Act (ACA), new incentives were created to promote employer wellness programs and encourage employers and employees to support healthier workplaces. The law enables employers to offer financial rewards to employees who participate in wellness programs or meet certain health-related targets.2 Increasingly, employers offering wellness programs are incorporating these financial incentives with the belief that they will boost the impact of their programs; however, little is known about the effectiveness of these incentive programs. 

In 2015, 14% of all employers, half of employers with 200 or more employees, and two-thirds of employers with 1000 or more employees offered wellness programs.3,4 These programs include health screenings that collect self-reported health risk information and biometric data from an in-person health examination conducted by a medical professional.1 Many employers incorporate financial incentives into their wellness programs. Thirty-two percent of employers with biometric screening programs incorporate a financial incentive for employees who complete the biometric screens; among large employers (≥200 employees) with wellness programs, 56% do so.

The use of incentives in conjunction with wellness programs is largely driven by employers’ beliefs that programs with incentives are somewhat (64% of employers who use incentives) or very effective (27%). Incentives are disbursed in a variety of ways, including premium discounts, waivers of cost sharing, or additional covered benefits. In practice, typical incentives range from $150 to $500, while the average annual premium for single coverage is $6251.1

Despite their widespread use, systematic evidence about the effectiveness of wellness programs with financial incentives is lacking. One literature review concluded that incentives were effective at increasing participation in self-reported health assessments, but was unable to assess their impact on the completion of preventive screenings.5 In randomized controlled settings, financial rewards not paired with wellness programs have been effective at increasing participation in health risk assessment completion,6,7 smoking cessation,8 weight loss,9,10 and chronic disease management.11-13 Randomized trials provide significant proof of concept that targeted financial incentives can be effective; however, as with all randomized trials in which participation requires an opt-in consent, it is difficult to assess generalizability, as many such trials only enroll 10% to 15% of potentially eligible individuals and participants likely differ from those who do not volunteer to participate on unmeasured characteristics, such as motivation.

The current study takes advantage of a sizeable natural experiment in which 39 large employers within the United States initially offered wellness programs without financial incentives. Over time, 15 of them added financial incentives and the remaining 24 did not. Financial incentives were attached to specific health actions, including annual preventive visits, biometric screening, and selected screening services for diabetes, heart disease, and cancer. Employees received personalized scorecards, both online and mailed to their home, to help them track their progress toward receiving incentives, which were awarded as premium reductions, cash, or gift cards. To our knowledge, ours is the largest study of wellness programs with financial incentives to date and includes over 1.4 million insured enrollees. A key strength of our design is the ability to examine pre-post effects of the introduction of incentives with a contemporaneous wellness program control group that did not introduce incentives. 

In addition, we considered whether the financial incentive effect is greatest for nonregular users of preventive services or for users who had received the service in the prior year. The financial incentive program is designed to be broad-based rather than targeted. Nonetheless, a program is more economically efficient if it entices new or nonregular users of prevention services rather than rewarding individuals who likely would have received the services in any case. 

METHODS

The Wellness Program

The wellness program we studied allows enrollees to earn dollars or points for adopting better health behaviors. Enrollees are provided a personalized scorecard, which includes health actions that were completed, as well as those that were not, as an aid to maintain or improve their health behaviors. The points earned for various activities can be converted into cash rewards, premium reductions, or gift cards in a manner set by the employer. We examined clinical screening outcomes that can be measured via claims data. The incentive for any given clinical screening was the same for all covered individuals within an employer, but could vary across employers. Incentive amounts ranged from $0 to $80 for preventive visits, $0 to $100 for low-density lipoprotein cholesterol (LDL-C) tests, $0 to $100 for blood sugar ascertainment with glycated hemoglobin, and $0 to $75 for cancer screening tests. The maximum annual award that an individual could earn for receiving all of these services ranged from $250 to $900 across employers. By contrast, employers without financial incentives in their wellness program promoted and measured the same outcomes, but employees did not receive an explicit financial reward.

Study Setting and Employers

All employers used the same insurer to administer their wellness programs, allowing us to observe preventive and health promoting behaviors before and after financial incentives were implemented. The 15 treatment employers introduced financial incentives into their wellness programs between 2010 and 2012, providing variation in the start dates. Individuals’ outcomes were observed as long as they were covered by the insurer. In many cases, the insurer was the sole provider of coverage for the employers. The staggered implementation by employer is illustrated in the Figure. Our data span January 2009 through December 2013. 

Data and Study Variables

We used de-identified healthcare claims and health plan enrollment and wellness program data from the insurer. Outcome variables were obtained from claims data based on standard claims codes. These include utilization of annual preventive visits, LDL-C tests, fasting blood sugar tests, and breast, cervical, and colon cancer screens. Coding details are provided in eAppendix Table 1 [eAppendices available at ajmc.com]. We were able to determine chronic conditions from claims, but not body mass index (BMI). From enrollment data, we obtained individual age, gender, dates and type of coverage, and whether the insured member was an employee or adult dependent. Insurance enrollment data typically have limited demographic information. However, through a vendor, the insurer obtained imputed information on race, ethnicity, and education of covered members, all potentially important factors that could influence an individual’s propensity to seek preventive care. 

Population

Our sample was restricted to adult (aged 18-64 years) employees who were covered by the insurer administering the wellness programs for at least 12 continuous months (1 full plan year). Spouses and domestic partners were included if they, in addition to the employee, were offered the wellness program. All sample members were included in models that examined annual preventive visits, LDL-C screening, and fasting blood sugar screening. Different subgroups were examined for each preventive screening (ie, women aged 40-64 years for breast cancer, women aged 18-64 years for cervical cancer, and men and women aged 50-64 years for colorectal cancer). Individuals older than 64 years were excluded because they were eligible for Medicare coverage. eAppendix Figure 1 illustrates our sample construction. 

Statistical Approach 

Our study employed a panel-data difference-in-differences (DID) design in which 39 employers offered wellness programs without financial incentives at baseline, 15 employers added financial incentives and the remaining 24 comparison employers did not.14 This is also commonly referred to as a stepped-wedge design. Because all employers used the same national insurer to administer their wellness programs, we observed preventive and health promoting behaviors before and after financial incentives were implemented based on common data collection. 

The effect of the incentive is estimated for each preventive service outcome using variations on equation 1, which reflects a staggered DID or stepped-wedge regression model. Equation: 

PrevServit= β0 + β1Treatmentit + β2 Xi + β3 HealthPlanit + γf Employer + γtYear + εit

The observations are at the individual-year level, where i denotes the individual and t denotes the year. The dependent variable, PrevServit, is an indicator variable that equals 1 if the relevant preventive service was received by individual i in year t. X represents a vector of individual covariates, including age; gender; imputed race, ethnicity, and education; whether the covered individual was an employee or dependent; whether the individual had asthma, coronary artery disease, congestive heart failure, chronic obstructive pulmonary disease, diabetes, or hypertension; and whether the individual was offered a high-deductible health plan with a health savings account or health reimbursement arrangement. Year and employer indicators are also included. Including employer indicators allows us to control for the average differences across employers in any time-invariant observable or unobservable employer-level predictors. The error term is represented by ε

Our key independent variable is represented in equation 1 by “Treatment.” The variable Treatment is a binary variable that takes the value 1 in any year that the individual is offered a wellness plan with incentives and 0 in all other years. Controlling for individual and other plan characteristics, the coefficient on this variable is interpreted as the average change across enrollees in employers with financial incentives relative to the average change for those with standard wellness programs. Standard errors were clustered by employer, and all reported P values were for 2-tailed statistical tests.

We estimated multivariate linear probability models to isolate the degree to which offering a wellness program with financial incentives in a given year influenced the probability of an employee receiving a selected preventive visit, cancer screening test, or blood test in that year relative to employees of employers that offered wellness programs without financial incentives. We selected linear probability models because their coefficients can be interpreted as marginal effects of treatment and because our treatment variable was binary. 

 
Copyright AJMC 2006-2017 Clinical Care Targeted Communications Group, LLC. All Rights Reserved.
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