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3 Things to Consider When it Comes to Wellness Program Incentives

Updated: Apr 30, 2022

3 Things to Consider When it Comes to Wellness Program Incentives

Wellness programs are designed to help employees adopt and maintain healthy behaviors in all areas of well-being. Improved employee health and morale, increased productivity and decreased healthcare costs are all incentives for employers to embrace wellness. However, as organizations integrate corporate wellness programs into their employee benefits offerings, identifying incentives for wellness program participation is important to program success. Well-designed incentives create excitement, promote engagement, encourage teamwork and offer employee’s recognition for reaching or exceeding goals. Not sure where to start? Here are a few things to consider when designing an incentive structure for your program.

Intrinsic vs. Extrinsic Motivation

Internal or “intrinsic” motivation is motivation that comes from within, such as interest or enjoyment, and is important for maintaining long-term behavior change. However, this kind of motivation must be built over time. Healthy behavior change does not happen overnight. Therefore, external or “extrinsic” motivators like gift cards, fitness trackers or discounted insurance premiums can provide the push employees need to start their wellness journey. As your wellness program grows and becomes engrained in your company culture, internal motivation will also grow, ultimately promoting long-term wellness among your employees.

Your Organization’s Budget

The effective use of incentives is key to the success of your wellness program, but budget can often seem like a limiting factor. However, with a little creativity, it does not have to be! It’s a best practice to consider both monetary and non-monetary incentives. Monetary incentives (such as gift cards, bonuses, HSA contributions, etc.) have a different impact on a wellness budget than non-monetary incentives (such as extra vacation days or flexible hours, public recognition, certificates and trophies, etc.). When working with a small budget, non-monetary incentives are an excellent option to boost engagement in a cost-effective way. Remember, while choosing an incentive structure is based on your organization's budget, it is just as important to understand how employees will perceive these incentives. Make sure whatever you offer is meaningful to your employees.

Incentive Regulations

While incentives are vital to program engagement and participation, it is important to comply with regulations set forth by the Equal Employment Opportunity Commission (EEOC). A recent proposal by the EEOC suggested that incentives be limited to “modest value” for any wellness programs that collect health information as a part of their programs, except for those that are part of a group health plan. However, this law was not enacted, and the industry awaits updated regulations. The current law that remains in effect allows organizations to offer incentives up to 30% of the cost of an employee's health insurance premium (or 50% for programs that include prevention or reduction in tobacco use.)

It is important to continue to stay up-to-date on EEOC regulations to determine if your organization’s incentives are in compliance with current laws.

Wellness Workdays can help you understand the importance of wellness program incentives and can provide expertise as you decide which incentive options would be best for your organization and budget. Contact us to learn more.




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