As employers try to nudge employees toward healthy behaviors, a growing number are taking aim at the medical expense accounts linked to the health plans they offer their workers.
And increasingly the hefty financial contributions employers are dangling in front of employees are dependent on whether employees keep their blood pressure in check, say, or agree to work with a health coach to manage their diabetes. Along with cash and reduced premiums, the contributions are one more way employers are trying to boost health program participation.
According to the 2013 annual health benefits survey by Towers Watson and the National Business Group on Health released earlier this month, two-thirds of companies with 1,000 employees or more offered account-based health plans. And 26 percent of those large employers tied account contributions to wellness or health management behaviors in 2013. Another 29 percent of employers said they planned to do so in 2014, the survey found.
Typically it was a health plan with a relatively high deductible linked to a health savings account or a health reimbursement arrangement. Employees can use the tax-advantaged savings accounts to cover their out-of-pocket medical expenses in the high-deductible plans.
About two-thirds of employers make contributions to their employees’ health savings accounts or health reimbursement arrangements, an older type of savings account that can be funded only with employer money and belongs to the employer if the worker leaves the job, according to the Kaiser Family Foundation’s 2012 employer-sponsored health benefits survey.
Employer contributions range from roughly $600 to $1,000 for single coverage on average, and from $1,000 to $1,800 for family coverage. (Kaiser Health News is an editorially independent project of the Kaiser Family Foundation.)
Tying employer account contributions to health behaviors “creates a dynamic where the money [comes] in exchange for people being positively engaged,” says Alexander Domaszewicz, health care consumerism practice leader for benefits consultant Mercer. “We’ve got a good body of evidence that having people pay more attention to their health can lead to good outcomes.”