IncentOne Statement Regarding Final Ruling on the Use of Wellness Incentives

Share Article

Free Webinar to be conducted on July 16, 2013, 2 PM ET for more insight.

News Image

IncentOne, the leading provider of healthcare incentive solutions, has issued a statement on the recent final regulations regarding incentive use in wellness programs that are effective as of January 1, 2014. The company will also conduct a free webinar on July 16, 2013, 2 PM ET to provide more insight on the final rulings. (Email IncentOne’s media contact if interested in attending webinar.)

After releasing preliminary rules in November 2012 and receiving comments from the healthcare and consumer community, the U.S. Department of Health and Human Services and other government agencies issued final regulations on May 29, 2012 on nondiscriminatory wellness programs and the use of incentives. The regulations strike a balance between allowing for innovation and protecting individuals from discriminatory activities. This provides both an opportunity for creativity and the need to manage the current and new requirements created by the rules. The regulation states that they are “intended to allow experimentation in diverse ways of promoting wellness” and that the administration did not “want plans and issuers to be constrained by a narrow set of programs but want plans and issuers to feel free to consider innovative programs for motivating individuals to make efforts to improve their health.”

Highlights include:

  • Finalizing the maximum reward from 20% to 30% of the cost of healthcare coverage and up to 50% for the prevention or reduction in tobacco use
  • Providing additional clarity around the two types of wellness programs - participatory and health contingent
  • Dividing health contingent programs into activity based (i.e., requiring an action) or outcomes based (i.e., requiring a threshold or goal to be achieved)

In addition, the regulations outlined some new requirements for reasonable alternative standards that are required for health contingent programs such as:

  • Physician verification cannot be required as a prerequisite to an alternative standard being available
  • Use of a physician’s recommendation as a viable reasonable alternative
  • Provision requiring a second reasonable alternative recommended by the individual’s personal physician if requested and the original physician is associated with the sponsor
  • Retroactive payment of incentives for completion of the reasonable alternative
  • Need to provide individuals with adequate time to complete reasonable alternatives

The intention of the regulations are to ensure that every participant in the program receives the full amount of the reward regardless of any health factor, and ultimately prevent unfair underwriting practices, e.g., rewarding the healthy by decreasing the cost of their health coverage through incentives.

“Both the angel and the devil is in the details,” said Michael Dermer, President and CEO of IncentOne. ”The administration left the door open to both creativity and outcomes-based programs, but only if there are alternative doors to receive the same reward. Incentive programs done well should strike a similar balance between results, accountability and fairness.”

About IncentOne
IncentOne delivers cost savings and health improvement by engaging healthcare consumers and providers through the use of incentives. IncentOne serves customers representing more than 50 million lives, has processed 30 million health transactions and driven 20 million health milestones through 125 data partners. IncentOne’s Universal Remote™ technology enables customers to drive “any action for any value for any reward via any medium” and to align incentives not only to long-term savings but also to immediate and intermediate savings via its Trifecta™ methodology. IncentOne’s solutions are married with leading-edge strategies such as value-based benefit design, medical homes, accountable care organizations, telehealth, pay-for-performance and provider payment reform to deliver true engagement. IncentOne programs target consumers to improve utilization, increase prevention, avoid hospitalizations, reduce readmissions, choose lower cost providers, reduce health risks, increase medication adherence and steer benefit selection and providers to adopt e-prescribing and EMR technology, adhere to treatment protocols, and improve patient safety. For more information go to http://www.incentone.com. Follow us on Twitter @incentone.

###

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Patricia Bannon
IncentOne, Inc.
(201) 372-9250 308
Email >
Visit website