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 certain conditions, such whether employees keep their blood pressure in check, for example, 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 participation in health programs.
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 health insurance plans that included medical expense accounts. And 26 percent of those large employers tied their account contributions to wellness or health management behaviors. 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, and was linked to a health savings account or a "health reimbursement arrangement," an older type of savings account that can be funded only with employer money and that belongs to the employer if the worker leaves the job. Employees can use these 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 these sorts of medical expense accounts, according to the Kaiser Family Foundation's 2012 employer-sponsored health benefits survey. (Kaiser Health News is an editorially independent project of the Kaiser Family Foundation.)
Employer contributions range from roughly $600 to $1,000, on average, for accounts meant to cover just one person, and from $1,000 to $1,800 for family coverage.
Tying employer account contributions to health behaviors "creates a dynamic where the money [comes] in exchange for people being positively engaged," says Alexander Domaszewicz, a health care specialist at Mercer, an employee benefits consulting firm. "We've got a good body of evidence that having people pay more attention to their health can lead to good outcomes."