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Making Health Pay Off

When it comes to wellness programs, money talks. And now that the the rules governing cash incentives have been clarified, a growing number of companies are making offers few employees can refuse

By Robert Rosenberg | Updated on September 05, 2007

While wellness programs have long been a feature of employer-based healthcare plans, doing the right thing, at least from a health perspective, was not reward enough for those at greatest risk from such behaviors as obesity, smoking and other behaviors. An incentive, such as cash, was clearly needed, but companies held off on cash proposals, until the rules were clear.

Now there may be an explosion of wellness programs, thanks to a joint declaration issued in December 2006 by the Internal Revenue Service, the Department of Labor and the Department of Health and Human Services formalizing the regulations. The IRS, Labor and DHHS said, among other things, that the reward can take the form of a premium discount, a premium rebate or a waiver of all or part of such cost-sharing mechanisms and not exceed 20% of the cost of coverage.

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