Corporate employers plan to spend an average of $594 per employee on wellness-based incentives within their health care programs this year, according to a new employer survey conducted by Fidelity Investments and the National Business Group on Health. This marks an increase of 15% from the average of $521 reported for 2013, and is more than double the average of $260 reported five years ago. The largest increase was among companies with fewer than 5,000 employees, where the per employee average climbed to $595, one-third higher than the average of $444 per employee in 2013.
The survey is the latest in a series Fidelity and the National Business Group on Health have conducted since 2009 to analyze the growth of corporate health improvement programs, which are designed to help employers manage their corporate health care costs by creating a healthier workforce. The most popular wellness programs continue to be focused on lifestyle management: physical activity programs, weight management programs and stress management; other popular health improvement options including disease/care management programs such as managing chronic health conditions; lifestyle-management services such as weight loss advice and gym membership discounts; health-risk management services such as on-site flu shots; and environmental enhancements such as bike racks and walking paths.
In addition to increasing the average amount spent per employee, the survey found that most companies view wellness programs as an essential part of their benefits program. The survey found that 95% of companies plan to offer some kind of health improvement program for their employees, and the percentage of companies offering incentives to participate in these initiatives has increased from 57% in 2009 to 74% in 2014.
When asked about ongoing funding for wellness-based incentive programs, 93% of companies indicated they plan to expand or maintain funding for their program over the next three to five years. And 44% of companies said they plan to maintain or increase their investment in wellness programs, even if their company were to move away from direct involvement in employer-sponsored health coverage, such as a move to a private exchange model to provide health benefits for their employees.
Companies expand incentives to include spouses, provide incentives through HSAs
As the design of wellness programs continues to evolve, an increasing number of companies are expanding wellness-based incentives to include spouses and domestic partners. Nearly four out of 10 (37%) of companies surveyed indicated their program will include spouses and domestic partners in 2014, and the average spouse/domestic partner incentive is expected to reach $530 in 2014, more than $100 higher than the average of $420 in 2010. When analyzing the data by company size, the results showed that employers with more than 20,000 employees expect to spend an average of $611 on spouses/domestic partners in 2014.
While many employers offer incentives through cash or a gift card, an increasing number of employers offer incentives through an employer-sponsored health savings account (HSA), flexible spending account (FSA) or similar care-based savings vehicle. More than a third (34%) of employers plan to contribute to an HSA or FSA for engaging in a disease or care management program, while 33% plan to offer a similar incentive for participation in a stress management program. Three out of 10 employers (30%) plan to offer incentives through contributions to an HSA/FSA for enrollment in a weight management program.
“While the use and measurement of corporate wellness programs continue to evolve, it has become clear that many employers understand the value of—and are committed to—wellness-based incentives in their company health plan,” said Robert Kennedy, Health & Welfare Practice Leader with Fidelity’s Benefits Consulting business. “Companies are constantly looking for new and creative ways to expand their programs and motivate their workforce, such as extending wellness incentives to spouses and offering incentives through a contribution to a health savings account. Increasingly, employers are viewing health improvement even more broadly through the lens of well-being and productivity.”
“This is our fifth annual wellness survey with Fidelity, and it’s encouraging to see how the use of wellness programs has evolved since 2009 and how employers continue to look for new ways to improve their plans and encourage employee engagement,” said Helen Darling, president and chief executive officer of the National Business Group on Health. “Based on the feedback from this year’s survey respondents, it’s obvious that wellness programs not only play a key role in many corporate health care plans today, but they’ll continue to be an integral part of corporate benefit programs in the future.”
Data for the survey were collected online in November and December of 2013 by the National Business Group on Health in conjunction with Fidelity and are based on responses from a national sample of 151 companies from numerous industries including transportation, health care, technology, entertainment, consumer products, retail and energy. The sizes of the companies spanned a broad range, from fewer than 2,000 to more than 50,000 employees. The results of this survey may not be representative of all companies meeting the same criteria as those surveyed for this study.