Social vs. Financial Incentives: The Burning Question In Employee Wellness

2 Copyright © 2012 ShapeUp, Inc. Confidential & Proprietary.

Rajiv Kumar, M.D. Founder & Chief Medical Officer [email protected]

Shawn LaVana Vice President of Marketing [email protected] Elise Meyer Marketing Associate [email protected]

Today’s Webinar Hosts

mailto:[email protected]




Join the Conversation on Twitter

@shapeupdotcom #wellnessincentives


Our Company’s Mission

Creating a healthier world by leveraging social influence to

engage people in healthy activities


• Current State of Wellness Incentives

• Employer Perspectives

• Financial & Social Incentives Research

• ShapeUp’s Approach to Incentives

• Key Takeaways

• Questions & Answers

Today’s Agenda


The Current State of Employee Wellness Incentives


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

Incentives are popular, but formats differ

Average Annual Incentive = $375


Mixed results with financial incentives

0

10

20

30

40

50%

HRAParticipation

With

Ince

ntiv

es

With

outI

ncen

tives

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)


Moving toward penalties and outcomes

0

20

40

60

80

100%

2009

No

Yes

2011 2012E0

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

Source: 2011 Towers Watson/National Business Group on Health Staying@Work (n=335)


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.”

Health care reform expands incentives


• Teamwork (social support)

• Competition (friendly)

• Public recognition (social status)

• Peer pressure (accountability)

• Social norms (company culture)

• Altruism (helping others)

What are social incentives?


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.”

Employer use of social incentives

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


Employer Perspectives on Incentives


Erica Ullman Wellness Program Manager Life Technologies Corporation


How We Use Incentives

Engagement in Health

Improvement

Qualifying activities for employee and spouse:

• Health Assessment • Biometric Screenings

Wellness Incentives

Non-tobacco use premium discount (10%) Health Savings Account

Contributions: preventive exam ($100) health coaching ($100) biometric results ($400)

Planning and decision support tools

U.S. Medical Plans

Full replacement consumer directed plans

with health savings account:

1. HSA Plus Plan 2. HSA Standard Plan


What We’ve Learned W

hat W

orke

d Preventive exams increased Health risk & screening values from yr 1 to yr 2 have improved or remained flat The “I kept going because I didn’t want to let my team down” Factor

2010

Act

ion

Wha

t Didn’t W

ork

Engaging employees who are not enrolled in medical plan (18%) Offering incentives for just participation; employees wanted to be rewarded for results & performance


Kenneth Foresti Health & Wellness Consultant [email protected]



• Health insurance premium incentive of $520/year is tied to health screenings

• Premium incentive is available to all employees of Excellus Health Plan and those of select subsidiaries.

• Online wellness incentive program designed to encourage individuals to take a more active role in managing their health and well-being.

• Earn up to $500 for an employee of Excellus Health Plan and those of select subsidiaries and up to an additional $500 for employee’s spouse or domestic partner by participating in the online wellness incentive program.


What We’ve Learned

Key:

Blue - Non-wellness incentive years

Green - Wellness incentive years (2008 pilot)

Key:

Blue - No or minimal premium incentive

Green - $520 health insurance premium

incentive

0%10%20%30%40%50%60%70%80%90%

2005 2006 2007 2008 2009 2010 2011

Year

Health Screening Participation: Excellus Health Plan Employees and

those of select subsidiaries

0%

10%

20%

30%

40%

50%

60%

70%

2005 2006 2007 2008 2009 2010 2011

Year

HRA/Wellness Profile Participation: Excellus Health Plan Employees and those

of select subsidiaries


Cindi Solomon Employee Wellness Operations Manager [email protected]


• Medical insurance premium discount • $20/pay; $520/year

• Annual health risk assessment during benefits open enrollment. Discount applied first six months of the year

• Employees actively participate in ShapeUp’s physical activity challenges. Discount applied second six months of the year

• Program enrollment incentives

• Program participation and completion incentives

• Payroll deduction “promissory note”



• Communication is key

• Must have buy-in and collaboration with other departments • Benefits

• Payroll

• Marketing

• Employees should have some “skin” in the program

• Enrollment incentives are useful for boosting enrollment numbers; not so great for sustained engagement or program completion

• Depending on the value of the incentive employees may view the program as mandatory

What We’ve Learned


Bryce Williams Director, Wellvolution [email protected]


2011 Discount: Tier 1 (<$34K) $240 Tier 2 ($34-54K) $396 Tier 3 (>$54K) $720 2012 Discount: Tier 1 (<$34K) $504 Tier 2 ($34-54K) $804 Tier 3 (>$54K) $1,200

Aligned Incentives


Shape Up Shield

0

200

400

600

800

1000

1200

1400

SUS1 SUS2 SUS3 SUS4

Parti

cipa

nts

Alumni Newbies

social wellness is: “sticky” - significant alumni retention “viral” – strong newbie adoption “popular” – one program = 40% of BSC employees


1. One-time actions Health assessment, biometric screening completion

2. Ongoing actions Regular exercise, healthy eating, ongoing engagement

3. Outcomes Reaching and sustaining milestones or biometric results (e.g. BMI threshold, blood pressure)

Employers seek three wellness goals

Weight Loss


Financial Incentives: The Research


Financial Incentive–Based Approaches for Weight Loss • Objective: Do behavioral economic theories work for

weight loss?

• Design: 57 overweight participants aged 30-70, randomized to 3 weight loss plans: monthly weigh-ins, lottery incentive, deposit contract, with goal of 1 lb a week for 16 weeks

• Results: Control group (3.9 lb), lottery group (13.1 lb), deposit contract (14 lb). Incentive participants weighed significantly less at 7 months (9.2 lb), controls did not.

• Conclusion: Financial incentives produced significant weight loss over 16 weeks that was not fully sustained. Longer-term evaluation of incentives is needed.

Financial incentives produce weight loss

Kevin G. Volpp, MD, PhD et al, JAMA. 2008;300(22):2631-2637.


Testing the Effect of Different Levels of Financial Incentives on Weight Loss Among Overweight Employees • Objective: Test ability of modest financial incentives to

encourage weight loss in overweight employees

• Methods: Randomized, measurements at baseline, 3, and 6 months and two levels of incentives ($7 and $14 per percentage point of weight lost)

• Results: At 3 months, participants with no financial incentive lost 2 lbs, $7 group lost 3 lbs, and $14 group lost 4.7 lbs. Between baseline and 6 months, when financial gains were equalized, weight losses were similar across groups.

• Conclusion: Modest financial incentives can be effective in motivating overweight employees to lose weight, but results may not be sustainable.

Even small incentive amounts can work

Finkelstein, Eric A. PhD et al, Journal of Occupational and Environmental Medicine, September 2007


• How people perceive immediate vs. delayed rewards

• Mental accounting and benefit of not bundling rewards

• Structuring incentives as rewards vs. penalties

Lessons from behavioral economics


• Financial incentives work well for one-time actions

• They can produce short-term outcomes (e.g. weight loss)

• Even relatively small amounts can work

• Long-term sustainability is unproven

• Behavioral economics offers key lessons: • Immediate vs. delayed benefits

• Mental accounting

• Rewards vs. penalties

Summary of financial incentives research


Social Incentives: The Research


Weight Loss Competitions at the Work Site: Impact on Weight, Morale and Cost-Effectiveness • Objective: Test competition as an incentive for weight loss

• Methods: Three team-based weight loss competitions were held in workplaces; one was inter-company, the other two were intra-company.

• Results: Attrition was less than 1%, weight loss averaged 12.1 lbs. Participants reported positive changes in morale and employee/management relations, and both considered the competition important to the success of the program. The cost-effectiveness ratio ($2.93 per 1% reduction in percentage overweight) was the best at the time.

• Conclusion: Teamwork and competition are effective motivators for weight loss and lead to other positive outcomes in a workplace setting.

Social incentives for weight loss (1984)

K D Brownell et al, American Journal of Public Health, Vol. 74, Issue 11 1283-1285, 1984


A Statewide Intervention Reduces BMI in Adults: Shape Up Rhode Island Results • Objective: Evaluate weight loss outcomes

• Methods: Measure weight loss achieved among 3,311 participants in Shape Up RI, a 16-week workplace-based exercise and weight loss team competition.

• Results: 7 lbs, 30% achieved clinically significant weight loss of 5%, shifted the BMI distribution from mean of 29.4 to 28.2 and reduced the obese population from 39 to 31%. Weight loss maintenance at 10 months was 73%.

• Conclusion: Team-based, weight loss competitions can produce weight losses in large numbers of participants and may be sustainable long-term.

Social incentives for weight loss (2009)

Rena R. Wing, et al , Obesity (2009) 17 5, 991–995.


Benefits of Recruiting Participants With Friends and Increasing Social Support for Weight Loss and Maintenance • Objective: Determine the benefits of social support for weight

loss and maintenance

• Methods: Recruited participants (N = 166) either alone or with 3 friends or family members and then randomly assigned them to a standard behavioral treatment with and without social support strategies.

• Results: Participants recruited with friends and given social support had greater weight losses at 4-months (20 lbs) and 10-months (19 lbs) than those recruited alone (15 lbs and 12 lbs). In those recruited alone, 76% completed and 24% maintained weight loss in full through month 10. When recruited with friends and social support, 95% completed and 66% maintained weight loss in full.

• Conclusion: Recruitment with friends and social support led to greater weight losses and longer-term sustainability.

Peer recruitment and social support

Rena R. Wing and Robert W. Jeffery, 27 July 1998.


Teammates and Social Influence Affect Weight Loss Outcomes in a Team-Based Weight Loss Competition • Objective: Investigated the effects of teammates and

social influence on individual weight loss and exercise outcomes

• Method: 12-week, team-based wellness competition

• Results: Overweight/obese completers lost 4.2% of initial body weight. Weight loss was similar among teammates. Having a greater percentage of teammates in the weight loss division and reporting higher social influence for weight loss were both associated with greater weight loss. Clinically significant (5%) weight loss tended to cluster within teams.

• Conclusion: Weight loss and the behaviors that lead to it are likely contagious, and harnessing and maximizing social influence for weight loss enhances outcomes.

Outcomes spread with social incentives

Tricia Leahey et al, Obesity, Feb 2012.


• Can produce significant health outcomes

• Often lead directly to other positive, non-health outcomes

• May produce more long-term sustainability than financial incentives

• Outcomes via social incentives have been shown to be contagious, spreading from person to person

Summary of social incentives research


Linking Social & Financial Incentives


Monetary Contracts in Weight Control: Effectiveness of Group and Individual Contracts of Varying Size • Objective: Test individual vs. group monetary contracts for

weight loss

• Methods: 89 overweight males (aged 35-57) assigned randomly to 1 of 6 groups for 15 wk weight loss program with goal of 30 lbs total loss. Each involved a deposit contract. Groups varied in amount of deposit ($30, $150, $300) and type of contract (refunds contingent on either individual or group performance).

• Results: Group contracts produced significantly more weight loss (31.1 lbs) than individual contracts (26.8 lbs) and the difference was maintained over 1 year (18.5 lbs vs. 14 lbs). Larger deposits led to larger outcomes, but short-term advantages rapidly disappeared.

• Conclusion: Linking financial incentives to social incentives produced the best weight loss and long-term maintenance.

Synergies with social & financial incentives

Robert W. Jeffery et al, Journal of Consulting and Clinical Psychology, Volume 51, Issue 2, April 1983


ShapeUp’s Approach to Wellness Incentives


Build the foundation on social incentives

Teams and groups

Competitions & challenges

Peer-to-peer recruitment

Facilitate conversations

Public expression

Peer encouragement

Status & comparison

1

2

3

4

5

6

7


Add financial incentives in three key ways

Reward Progress

Reward in Real-Time

Reward Social Actions


• Give employees ability to earn rewards for making measurable improvements, moving in the right direction

• Carries more weight than participation alone, and puts focus on the journey not just the destination

• Rewarding progress keeps people engaged and gives all employees a fair chance to play

Reward progress to sustain engagement


• Don’t make employees wait: reward them in real-time when they take an action or reach a milestone

• Technology has made this logistically possible

• Smaller amounts in the present can carry more weight than larger amounts in the future

• Increase the impact and effectiveness of your incentives without increasing your budget

Maximize impact with real-time rewards


• Encourage peer-to-peer recruitment (e.g. reward invites)

• Promote peer support (e.g. reward captains, peer-to-peer challenges)

• Leverage accountability (e.g. team completion rewards)

Use financial rewards for social actions


Final Thoughts


Financial incentives work for promoting one-time actions.

Short-term financial incentives produce outcomes but are not clearly sustainable.

Smaller, real-time, progress-based rewards, de-coupled from larger costs, leverage behavioral economics principles to boost engagement and outcomes.

Social incentives produce equivalent outcomes and may offer longer-term sustainability.

Financial and social incentives can be synergistic, more powerful together than alone.

Key Takeaways from Today’s Webinar


About ShapeUp We leverage both social and financial incentives to drive employee behavior change. Our evidence-based platform covers two million people at over 200 employers and health plans.

Contact Us Visit www.shapeup.com, email Dr. Kumar at [email protected], or call our office at (401) 274-1577.

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Social vs. Financial Incentives: The Burning Question In Employee Wellness

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