Are Wellness Incentives Worth the Money?

Does your wellness strategy include incentives? Chances are it does, according to data from a range of recent survey sources including Towers Watson, Fidelity, and the National Business Group on Health, somewhere between 65-90% of U.S. employers are using, or plan to use wellness incentives. In fact, according to these data around 3/4 of wellness program spending (average $400-$500) goes towards incentives and only 1/4 (average $150) towards program interventions. (View infographic here.)

My question to you is why?

Despite the overwhelming rise in their use, there is little evidence, or even logic, to suggest that they are good value for money.

The way you achieve value and return from a wellness program is through sustained changes and improvements in your population's health, energy, and lifestyle management (i.e. sustained behavior change). Do you get significant value from an employee who loses weight during a 12 week challenge only to gain it back over the following 12 weeks? No. This is the type of effect incentives can induce. That is, short-term, externally motivated outcomes with little long term change, and potentially negative long term effects on motivation.

If you've ever looked at the compelling information on motivation and incentives from Daniel Pink (highly recommend this 18 minute TED Talk. Link.), the ins and outs of how we learn explored by John Medina in Brain Rules, or studied the psychology of how people learn and change behaviors, then you'll know that in the long term, fixed incentives can:

  • decrease internal motivation
  • decrease people's ability to be creative and adapt behavior
  • decrease the level of satisfaction in achieving goals

When incentives are used in wellness programs, you undermine the inherent value of health, energy, and a high quality of life. You send a message that healthy behaviors are not enjoyable in their own right, and that health behaviors should only be adopted if they result in an external reward. In short, incentives turn play into a chore. They turn something that should be internally valued into an externally negotiated commodity.

Being healthy is inherently rewarding. If your employees are not voluntarily participating in programs and adopting healthy behaviors then it's not because they need an incentive, it's because you're not giving them what they need to succeed. A smarter investment is to put more money towards a more comprehensive program. One that actually gives your employees value, and the tools they need at a personal level to successfully improve their health. The per head cost for these comprehensive programs, on average, is approximately the same, or less than the current combined spending on wellness including incentives, and yet the resultant outcomes are far more sustainable and of far greater long term value due to the inherent nature of the reward.

Sick of wasting money on incentives that science says will get you nowhere? Call us for a comprehensive solution that works. To read more about how incentives may work against your goal of creating a culture of health, read a previous article here. Link

Published on by Andrew Stephenson.