All Digital Rewards understand the importance of a high-quality health and wellness incentive program in increasing workplace wellbeing and improving company efficiency. There are four main options for health and wellness incentive programs. We have discussed types 1, 2, and 3 in our previous posts in our Exploring Health and Wellness Program Types. Incentive and Reward Program Series. In this post, we will be reviewing Type 4 health and wellness incentive programs.
Type 4 Health Plan-Related Outcome-Based Programs are available to individuals enrolled in the sponsoring company’s health plan. Rewards are earned based on meeting certain program-specific desired outcomes required by the company’s health and wellness program. These outcomes could include things like reaching a certain BMI level or quitting smoking, which could be rewarded with a reduction in an employee’s health care contributions. Type 4 programs often include a tobacco cessation program. Health screenings are often required at the onset of a Type 4 health and wellness program in order to establish a baseline for the participants and to allow for easy progress tracking as the program progresses.
As is the case for all health and wellness incentive programs, Type 4 programs are required to ensure that there is an available alternative standard for those who are unable to complete the initial standard. The alternative standard does not need to be in place prior to the start of the program and can be developed as needed. When a participant requests an alternative standard, the sponsoring employer cannot request a doctor’s note as proof of the participant’s medical inability to satisfy the health and wellness program’s initial requirements.
Type 4 programs reward results, which can make them appealing to employers, as it will make them see a real return on investment from their participants. The rewards system with Type 4 programs can also be very appealing to participants because they get to see their efforts and progress rewarded. On the other hand, some Type 4 programs take the opposite approach and choose to penalize employees who fail to meet program standards. Examples of this could include increasing the plan contributions of program participants who are above a certain BMI or who continue to use tobacco products.
As with any health and wellness incentive program, Type 4 Health Plan-Related Outcome-Based Programs must ensure they are in compliance will all applicable legal requirements. Type 4 programs have the largest number of applicable legal requirements of any type of health and wellness incentive program. The primary laws and regulations that Type 4 programs must comply with include The Patient Protection and Affordable Care Act (PPACA), The Health Insurance Portability and Accountability Act (HIPPA), The Age Discrimination in Employment Act (ADEA), The Genetic Information Nondiscrimination Act (GINA), The Americans with Disabilities Act (ADA), The Employee Retirement Income Security Act (ERISA), The Fair Labor Standards Act (FLSA), The Consolidated Omnibus Budget Reconciliation Act (COBRA), Title VII of the Civil Rights Act, Cafeteria plan regulations, and various tax laws – particularly in regard to incentive values.
When choosing the right health and wellness program and what incentives can drive maximum participation, having the right people on your side can make things easy. All Digital Rewards has a team of experienced health and wellness program experts who can help you make an informed decision regarding incentives, products, and services, as well as the technology needed to manage a successful wellness program that will be the right fit for your organization’s needs. Our health and wellness experts are standing by to answer your questions. Give us a call at 866-415-7703 or click the “Schedule a Demo” button below!
