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Copyright © 2013 ShapeUp, Inc. All Rights Reserved. Proprietary & Confidential shapeup.com THE USE OF WELLNESS INCENTIVES BY EMPLOYERS

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Page 1: Q6 incentives

Copyright © 2013 ShapeUp, Inc. All Rights Reserved. Proprietary & Confidential shapeup.com

THE USE OF WELLNESS INCENTIVES BY

EMPLOYERS

Page 2: Q6 incentives

2

0

20

40

60

80

100%

Offer incentives

No

Yes

n=22

Basis ofincentive

Results

Participation

n=16

Averageamount(per yr)

$1,000+

$500-$700

$300-$500

$100-$200

$1-$100

n=13

Format ofincentive

HSAcontribution

Prizes

Discounton

premiums

Cash

n=12

375Averageamount

Wellness Incentives Are Popular & Varied

Average Annual Incentive = $375Source: ShapeUp Employer Wellness Survey http://www.shapeup.com/survey

Page 3: Q6 incentives

3

Incentives Work For Some Programs, Not Others

0

10

20

30

40

50%

HRAParticipation

With

Ince

ntiv

es

With

out

Ince

ntiv

es

46%

19%

BiometricScreening

45%

25%

DiseaseManagement

16%14%

Employee Participation by Program, 2011

Source: 2011 Towers Watson/National Business Group on Health Staying@Work (n=335)ShapeUp Employer Wellness Survey http://www.shapeup.com/survey

Page 4: Q6 incentives

4

0

20

40

60

80

100%

2009

No

Yes

2011 2012E

Employers Focusing On Penalties & Outcomes

Source: 2011 Towers Watson/National Business Group on Health Staying@Work (n=335)Source: ShapeUp Employer Wellness Survey http://www.shapeup.com/survey

0

20

40

60

80

100%

2011

No

Yes

2012E

Employers Using Penalties in Their Wellness Programs

Employers Using Rewards or Penalties Based on Health Outcomes

Page 5: Q6 incentives

5

Health Reform Is Expanding Use of Incentives

• Section 2705 of the Patient Protection and Affordable Care Act (ACA)

• Beginning in 2014, employers may use up to 30% of total health

insurance premiums (50% at the discretion of the secretary of

health and human services) to provide outcome-based

wellness incentives.

• Rewards can “be in the form of a discount or rebate of a

premium or contribution, a waiver of all or part of a cost-sharing

mechanism (such as deductibles, copayments, or coinsurance),

the absence of a surcharge, or the value of a benefit that would

otherwise not be provided under the plan.”

Page 6: Q6 incentives

6

Employers Also Employing Social Incentives

• Teamwork (social support)

• Competition (friendly)

• Public recognition (social status)

• Peer pressure (accountability)

• Social norms (company culture)

• Altruism (helping others)

Page 7: Q6 incentives

7

Employer Use of Social Incentives for Wellness

Social Networking

• 42 percent of high-performing companies plan to

incorporate some element of social networking into

their employee health initiatives by 2012

Wellness Competitions

• “This year, for the first time, workplace competitions

(individual or team competitions for weight loss,

physical activity, or other goals) are among the top

five program elements in several regions. This

reflects the rapidly growing popularity of such

activities, as employers seek new ways to motivate

and challenge employees to improve their health,

leveraging social psychology and peer motivation.”

Sources: Towers Watson 2010 Healthcare Report, Buck Consultants 2010 Global Wellness Survey

Page 8: Q6 incentives

8

Recommendations for Wellness Incentives

Lump-sum financial incentives produce outcomes but are not very

sustainable.

Smaller, real-time rewards can take advantage of behavioral

economic principles to boost outcomes.

Social incentives produce outcomes as well and offer longer-term

sustainability.

Financial and social incentives can be synergistic, more powerful

together than alone.

Every population is unique and requires a customized approach

to behavior change.

Page 9: Q6 incentives

Copyright © 2013 ShapeUp, Inc. All Rights Reserved. Proprietary & Confidential shapeup.com

Prepared by:

ShapeUp

www.shapeup.com

@shapeupdotcom