Get Fit and Pocket Up to $1,200 With Employer Wellness Programs
You may be able to pocket some serious cash if you get serious about your health. Wellness incentives at many employers are becoming financially attractive and worth the time, effort, and sweat to earn them. (See also: Fitness for People Who Hate Exercise)
For example, employees at a client organization of the Principal Wellness Company can save $1,200 yearly in health insurance premiums, plus an extra $1,200 for a covered spouse or partner. Though that deal is one of the most generous I’ve heard of, incentives offered by other companies can mean easy money, especially if you are already fit and healthy. Recently, a relative made $150 for achieving health criteria and a friend of a wellness coordinator friend won approximately $300 in gift cards just by logging her fitness activities.
You too may be able to parlay healthy behaviors into cash.
The Types of Incentives You Can Earn Through Wellness
Get started in earning money by learning about the wellness programs offered by your employer and your insurance company. Generally, incentives fall into these categories:
- Lower health insurance premiums
- Lower deductibles and co-pays
- Contributions to Health Savings Accounts (HSAs) or Health Reimbursement Accounts (HRAs)
- Cash bonuses
- Non-cash financial incentives such as gift cards, prizes, or gym memberships
- Paid time off (extra vacation days or a few hours off from work)
- Allotted time for participation in wellness programs, such as seminars
As employers move from traditional PPO plans to High Deductible Health Plans (HDHPs) or take other actions to control expenses, they are also offering wellness programs to help employees (and themselves) save money on medical bills, according to Lee Dukes, President of Principal Wellness Company. Better health often means fewer costs associated with the treatment of lifestyle-related diseases, saving money that can be shared among employers and employees.
Wellness programs and their incentives are often linked to health insurance plans. However, some businesses may offer wellness programs and prizes not directly related to insurance benefits. These may include lunchtime walking groups, cash prizes for weight loss, and onsite massage.
How to Qualify for Wellness Incentives: Participation vs. Achievement
There are two main ways to earn incentive dollars or benefits. Some programs require only that you participate to qualify. Others distribute cash only if you achieve certain health outcomes.
For example, the friend of a friend I mentioned above won gift cards by participating in fitness activities and recording them on a website maintained by her insurance carrier. She didn’t have to achieve a specific result, such as reducing her blood pressure or losing 10 pounds. She may have improved her health as a byproduct of these activities, but that’s not what qualified her for the prizes.
On the other hand, my relative had to achieve certain health criteria to get a cash payout. For each measure that came under the threshold established by the company (such as BMI below 25, blood pressure below 120/80, and total cholesterol under 200), he qualified for $50. Notably, he could earn partial rewards even if he didn't meet the standards in all categories. Also, the minutes of exercise he completed or the diet he followed was irrelevant to earning the incentives, although certainly those factors could influence the outcomes.
Lee tells me that many companies launch wellness programs with participatory screenings or activities and transition to outcome-based rewards in subsequent years. He also mentions that because some biometric measures (such as blood pressure readings) may fluctuate during the day, higher value and more sophisticated programs (like the one that knocks $1,200 off the annual health insurance premium) measure multiple factors related to risk of metabolic syndrome.
How to Achieve Health Targets
You may achieve desired health outcomes without any extra effort on your part if you already exercise and eat well. That is, your measures are consistently within target ranges:
- Blood pressure equal to or less than 120/80 mmHg
- Fasting blood sugar (glucose) less than 100 mg/dL
- Waist circumference (length around the waist) of less than 40 inches for men and less than 35 inches for women
- HDL cholesterol of more than 60 mg/dL
- Triglycerides of 149 mg/dl or less
Change Isn't Easy
Some people are disappointed to learn that they are not as healthy as they presumed, Davis Liu, M.D., a practicing board-certified family physician and author of "The Thrifty Patient" tells me. When patients try to earn wellness incentives, they may find that their numbers fall outside of healthy ranges, and they need to make changes to qualify for the lower-cost health insurance or bonus dollars.
Changes in habits are often difficult to make. Davis recommends taking small steps toward goals. Many people fail at their efforts because they are too aggressive and sudden; radical changes are often not sustainable.
Multiple minor adjustments work well to achieve long-lasting lifestyle changes. He often advises patients to use a framework from the book "Living SMART: Five Essential Skills to Change Your Health Habits Forever" that involves setting a simple goal, monitoring your progress, arranging the environment (and your schedule) to be successful, recruiting help or finding a buddy to join you, rewarding yourself (though preferably not with food), and repeating this process.
Specific advice includes:
- Control portion sizes (see how portion sizes have changed from years ago) and turn down second helpings
- Increase your consumption of fruit and vegetables to move toward a plant-based diet
- Walk 30 minutes a day several times each week (one of the cheapest forms of exercise) or, if you are just getting started, exercise 5 or 10 minutes for a couple of times each week
- Cut out excess liquid calories such as beer and soda
- Use apps such as Lose It or Moves to record activity and motivate yourself
If you are trying to achieve a certain target, consider starting a couple of months before formal assessments for health criteria are taken. In Davis’s experience, new habits may take as long as six to eight weeks to take hold and results tend to follow within this timeframe.
Tax and Other Rules to Know About Wellness Incentives
Wellness incentives tied to health insurance policies are restricted. For example, premiums can be reduced by just 20% (though that percentage increases to 30% in 2014). Still, on a $5,000 policy, you could pocket an extra $1,000 by being healthy and achieving wellness goals.
You should also know that you may be liable for taxes on certain incentives, like cash bonuses. My wellness coordinator friend tells me that her employer "grosses up" these awards so that employees get the cash amount advertised regardless of tax bracket. Other employers, though, may simply include the amount in your check and deduct taxes accordingly.
If you happen to score on reduced health insurance premiums that are taken out of your paycheck on a pre-tax basis, then your tax liability may be slightly higher because you are paying less for insurance. However, you may be able to apply these savings to an HSA or retirement account with tax advantages and keep your tax liability down.
Being fit and healthy is reward itself. But it’s nice to be able to make extra cash, get time off, or win prizes for maintaining or improving your well-being.
Have you earned wellness incentives? Was the effort worth the reward? Tell us about your experiences.