In an effort to encourage healthy behaviors, a growing number of employers are tightening their requirements for workers to receive financial incentives, according to a survey conducted by Towers Watson and the National Business Group on Health (NBGH), a nonprofit association of large U.S. employers.
Key Details
The main findings of the survey include:
More than half (53%) of large employers offer financial incentives to workers who enroll in health engagement activities, such as weight management or smoking cessation programs. However, for many employers, participation alone is no longer enough to earn an incentive. Currently, more than one-third of employers (37%) reward only those workers who meet the company’s requirements for completion of a health engagement activity, and almost one-third (29%) only reward members who participate in multiple activities.
The survey identified a group of “consistent performing” companies that have successfully held cost increases below the median trend for the last four years. In fact, these consistent performers experienced a median cost increase of just 2.1% over the last four years, compared with 6.8% for all companies. These companies separate themselves from poorer performing companies in five areas: appropriate financial incentives, effective information delivery, metrics and evidence, quality care, and health and productivity. Consistent performers spent $6,536 per employee on health care benefits in 2009 — nearly $1,200 less per employee than for all survey respondents.
Interest in consumer-directed health plans (CDHPs) continues to expand among employers and their workers. Just over half (54%) of companies now offer a CDHP, and that number is expected to grow to 61% in 2011. Nearly half (46%) of companies that offer a CDHP report at least 20% of their workers enrolled, an increase of nearly 70% in five years.
Companies with higher levels of CDHP enrollment report lower costs. Those with at least 50% of their workers enrolled in a CDHP report average annual costs per employee of nearly $1,000 less than at non-CDHP companies. Similarly, nearly 60% of survey respondents indicate their workers pay premiums that are at least 30% less than those for traditional copay plans.
In 2010, 38% of companies will offer a health savings account (HSA), with an additional 7% expected to do so in 2011.
In 2010, 46% of employers will provide coverage for use of retail clinics, up from 36% in 2009.
In 2010, 57% of employers will encourage plans and providers to provide workers with access to online medical records, up from 54% in 2009.
Background
The 15th Annual National Business Group on Health/Towers Watson Employer Survey on Purchasing Value in Health Care was conducted from November 2009 through January 2010 with 507 employers of 1,000 or more employees that collectively employ 11.5 million workers.
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