The Gif t (Card) of Wellness
July 07, 2008
Here's a potent carrot for health and wellness incentives
By Dan Butcher
With health care costs in the U.S. skyrocketing, top executives have been wracking their brains for ways to reduce expenditures in this area. Savvy companies have come to realize that gift cards are a simple, effective way to reduce health care costs by promoting healthy behavior. Overall health, increased performance/productivity, and cost reduction are the ultimate goals of such programs, and cards are becoming a common solution to incentivizing employees to participate in a wide variety of health-and-wellness programs.
"It's a specialty of our company," says Michael Dermer, president and CEO of Lyndhurst, N.J.–based IncentOne, a vendor of integrated incentive solutions whose clients range from small businesses to the Fortune 500. "Our clients include Wellpoint, 25 Blue Cross/Blue Shields, Motorola, Washington Mutual, and various state and federal government agencies."
No matter who the clients may be, they are all looking to save money by motivating employees to take action and reducing their health-care costs by encouraging a healthy lifestyle. "They all face the same issue," says Dermer. "Driving healthy behaviors with incentives is part of many state and federal legislative proposals; they know that if they can get someone to get a preventative cholesterol screening, that that individual eventually costs less, because they can identify a potential problem early on."
Baystate Health, a Springfield, Mass.–based integrated health system with approximately 10,000 employees, had offered various one-off incentives throughout the organization before. Barbara L. Pelletier, Baystate's health and wellness director, wanted a more comprehensive strategy that would reach all employees through a single Web-based platform. The objective was to encourage workers to complete a health risk assessment (HRA) and then participate in at least four health and wellness activities.
Working with IncentOne, Baystate chose to use gift cards as incentives, which was a popular choice that helped spur participation. Pelletier wanted the HRA to be the gateway to all other wellness efforts, so using IncentOne's Health Power points-based, multiple-program incentive solution, Baystate launched an offering that encouraged employees to complete the HRA first and then take appropriate actions to improve their health.
The results speak for themselves: 75 percent of eligible employees completed an HRA within 50 days of the launch. Sixty-two percent have completed at least one health-related activity. More than 13 percent have reached the goal of completing four or more wellness activities.
Dermer cites a survey of CEOs working at large corporations asked about strategies to reduce costs. Eighty-four percent called incentives the number-one way to cut health care expenditures. "You need people to take preventative care when they don't feel pain yet," say Dermer, "so you've got to incentivize them in ways that are meaningful to them and that will lead to healthy behaviors." Health-plan providers, employers and governments are all looking to get people to have healthy habits, such as going to the gym, getting regular screenings and checkups, and quitting smoking.
"The broader message is 'be healthy and be rewarded,'" says Dermer. "Gift cards are a great tool to drive that behavior."
Pushing Productivity
Foot Locker promotes its employee wellness and incentive programs as "your company's key to higher productivity," noting that healthy employees produce more revenue as well as cutting health care costs. "Over the past few years, Foot Locker gift cards have enjoyed tremendous success in health-and-wellness-related programs and events," says Dennis Borst, president/COO of Hollywood, Calif.–based Patriot Marketing Group (PMG), which runs Foot Locker's gift card sales program. "Some of the various employee-oriented initiatives we have participated in include wellness programs, 'Biggest Loser' weight loss programs, exercise programs, and team-building events."
PMG has also partnered with companies such as Kraft, Lipton and Silk Soymilk to organize healthy eating programs and sweepstakes for consumers, and has worked with pharmaceutical companies at patient events for product launches.
PMG's bread-and-butter wellness program, SmartMoves, is a series of incentive-driven wellness programs designed to increase the health and productivity of clients' employees. After a quick online survey, PMG tailors the incentives to employees' preferences and clients' specific needs. Examples of SmartMoves programs include pedometer-based walking programs, on-site yoga and Pilates classes, weight-loss and smoking-cessation programs, on-site or off-site gym programs, "smart patient" medical prevention programs, and "nutrition for performance" programs.
Participating employees earn points that can be redeemed for rewards from a catalog of gift cards. "We use Foot Locker as the headliner coupled with Jamba Juice, local health-food stores, spas and salons, among others," says Borst, who adds: "The program promotes prevention and helps to lower health care costs." Another benefit: The incentives decrease absenteeism by promoting employee health, he says.
Potent Peer Pressure
Health and wellness programs are becoming a trend in the corporate world. A recent survey conducted by Watson Wyatt found that 75 percent of large companies offered a health promotion program in 2006, up from about 50 percent in 2003. Since participation in wellness programs is voluntary, the challenge for businesses is how to motivate, or incentivize, employees to participate. Last year, the Society for Human Resource Management found that 43 percent of companies that offered health insurance also offered some type of incentive to encourage healthy behavior, and that number is growing every day.
"Many companies have found success in using gift cards as an incentive to motivate healthy behavior and participation in wellness initiatives," says Rick Blabolil, president of Rosemont, Ill.–based Marketing Innovators. "Gift cards are awarded for such things as involvement in Health Risk Assessments, or as rewards for completing various phases or goals within a wellness program."
"One company here in Chicago is sponsoring a summer walkingprogram, where employees participate in teams to achieve walking goals," he continues. "Each employee who signs up for the program is given a company-branded pedometer to track their weekly steps, and each month all members of the top team win a $25 gift card, choosing from hundreds of available merchants." The team approach provides an environment where members encourage each other to improve team results.
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