Are High Deductible Plans Hurting Your Wellness ROI?
Whether the goal is lowering medical claims, reducing absenteeism, or increasing employee morale, participation will always drive a successful wellness program.
Knowing this, employers must be vigilant in uncovering obstacles that discourage wellness participation.
Recent research has shown a negative correlation between High Deductible Health Plans (HDHPs) and employee wellness participation. Here are some of the findings.
Low-wage employees have a greater need for wellness
Research shows that Low-wage earners (those workers with a take-home pay under $30,000) have the highest prevalence of unhealthy behaviors and chronic conditions. That means they are a primary target for disease and lifestyle management programs.
Here’s the problem. When prioritizing stressors, financial wellness is a greater priority to the average employee than personal health care. The less you make, the more stressful finances become. Low-wage earners simply don’t have the capacity to focus on personal health.
Bob Nease captures this phenomenon in his book, The Power of Fifty Bits: The New Science of Turning Good Intentions Into Positive Results. Human survival has trained our brains to focus on maximizing survivability. Limited to roughly 50 bits of conscious brain capacity, we subconsciously filter out information that would cause further stress or deprive us of immediate well-being.
In short, when low-wage earners have all of their brain capacity occupied by financial stress, personal health takes a back seat. It’s not that they don’t believe in wellness or living a healthier lifestyle. They literally don’t have the capacity for it.
Low-wage employees show lower wellness participation rates
As a result, we see lower wellness program participation rates in low wage earners, specifically those enrolled in HDHPs. Shifting a greater cost burden onto employees through HDHPs has only further diminished their capacity to focus on personal health.
In many cases the employee contribution to health coverage is approaching as much as 25% of total wages, with the average deductible in 2016 being $1,400. With the average take-home pay for Americans being below $30,000, the financial stress of health care can halt any focus on wellness.
Specifically, Truven Health Analytics released a study which showed that low-wage employees were 40% less likely to complete a biometric screening. Participation increased steadily with higher wages.
As a result, employers aiming to glean insights on workforce health through biometric screenings may have an incomplete picture and skewed data due to lack of participation amongst low-wage earners. This could lead to miss-targeted wellness initiatives and negative impacts on Wellness Return on Investment.