How One Payer Redesigned Wellness Program Rewards Around Choice, Tech

Expanding members’ choices

At its core, the new financial rewards program revolved around giving members more choices, a goal that started with a new definition for “wellness.” Previous programs had been rooted in the fitness aspect of wellness, but UnitedHealthcare took a different approach.

“Fitness is obviously an important part of wellness, but we're also bringing more choices to our members, giving them more ways to engage and more ways to earn rewards,” Baker explained.

“You'll see goals that are related to fitness, to sleep, and also getting a biometric screening or completing a health survey—so, really trying to empower our members with more choice to meet their needs.”

Two forces drove UnitedHealthcare to rethink its wellness goals: its members and evolving technology.

Members engaged in wellness in several ways beyond achieving fitness goals. UnitedHealthcare incorporated these additional wellness goals into its incentives program, allowing members to get rewards for achieving sleep, mindfulness, and nutrition objectives as well as applying incentives to traditional wellness activities.

Fitness is obviously an important part of wellness, but we're also bringing more choices to our members, giving them more ways to engage and more ways to earn rewards.

Technology has changed substantially in the several years since UnitedHealthcare’s legacy products emerged. The UnitedHealthcare Rewards program incorporated these advancements by enabling members to track their progress using various types of devices. These devices included Apple watches, Fitbits, Garmins, and other electronics.

“We wanted to make sure that we were also leveraging the advances in technology to bring a more well-rounded product offering forward,” Baker said.

Giving members more choices went beyond offering more options for managing their wellness: UnitedHealthcare also expanded how members can receive and spend their rewards.

Members could choose to put their reward dollars into a health savings account. Alternatively, they could receive their incentive through a digital gift card with few limitations regarding where members could spend. Baker said that the payer is open to delivering rewards through additional channels in the future and will listen to member feedback to discern if that is necessary.

Restructuring program goals

Another challenge that the UnitedHealthcare Rewards program sought to address was maintaining wellness momentum.

The Centers for Disease Control and Prevention (CDC) lists eight barriers to physical activity, including emotional, psychological, and circumstantial challenges. The list is not exhaustive but demonstrates how many roadblocks members may face when kicking off a wellness routine.

The UnitedHealthcare Rewards program was designed to take these barriers into account by reorienting the timeline for members’ goals.

“Sometimes, you could end up getting defeated because you started off on a good track and maybe you missed a day because life or your toddlers got you sick,” Baker shared.

“One of the things I love about UnitedHealthcare Rewards is every day is a new day and there are new goals that reset every day. That really builds on more persistent engagement and healthy behavior over time.”

While some of its activities are long-term—for example, tracking an individual’s sleep patterns for two weeks—most of the examples listed in the press release are daily goals. As a result, members are less likely to get discouraged and lose progress when life interrupts their habits.

Members can get rewards for walking 5,000 steps in a day. They can also gain rewards for doing an activity for 15 minutes or more each day.

According to Harvard Business Review, achieving a goal involves taking little steps that an individual can build on incrementally and categorizing the goal into smaller, more manageable segments. By pursuing a smaller, daily goal instead of a weekly or monthly goal, members may have a greater chance at long-term success.

Simplifying rewards programs

Digital health is streamlining the consumer experience as it evolves. In particular, the healthcare system is finally catching up with other industries in using apps to simplify the consumer experience.

UnitedHealthcare wanted to create an easier way for members to engage with their rewards, Baker indicated, so the payer integrated its rewards program into its existing apps.

“You'll see that UnitedHealthcare Rewards is built within our digital experience, both MyUHC and our UHC mobile app, really making it simple and easy for our members to get activated and get engaged,” Baker said.

First, members download the mobile app. Then, they consent to share wearable data with UnitedHealthcare. Any data that UnitedHealthcare receives from the individual’s wearable device is used strictly for the Rewards program. The payer does not send that data to providers or third-parties.

We wanted to make it as simple and easy for members to get rewarded for those healthy activities, which is why the program is anchored in consumer wearable technology.

But the effort to simplify the rewards program extended beyond how members receive their rewards. UnitedHealthcare also sought to simplify how members report their activities and data, so the payer made its program compatible with technologies like Apple watches and Fitbits.

“We wanted to make it as simple and easy for members to get rewarded for those healthy activities, which is why the program is anchored in consumer wearable technology,” Baker said. “Members can go about their day, engage in the behavior that's relevant to them, and we'll be able to seamlessly reward them for engaging in that healthy behavior.”

Offering rewards that deliver better value

UnitedHealthcare members can receive anywhere from $300 to $1,000 annually in rewards based on their wellness.

This range falls well within the industry trend for employers in the 2020s. The median maximum financial incentive hovered at $600 in 2021 and 2022. The average incentive grew 22 percent during that timeframe to hit $823.

Baker named two primary drivers behind UnitedHealthcare’s incentive amount for the Rewards program.

The first is regulatory and tax boundaries. Numerous laws govern wellness program incentives.

For example, the IRS considers financial rewards as part of an employee’s income and, therefore, taxable. And group health plans offered under the Affordable Care Act must comply with certain limitations on the maximum permissible reward amount.

Under the Biden administration, the U.S. Equal Employment Opportunity Commission (EEOC) proposed new regulations related to wellness incentives that collect employee health data to avoid coercion. However, these regulations were dropped.

Rules like these place limits on how much of a reward employers can offer their employees, whether the rewards can be taxed, and more. Some plans cannot offer rewards greater than $300 while others can offer up to $1,000. Additionally, offering prepaid debit cards can have certain tax implications.

In addition to regulatory limitations, UnitedHealthcare offered a range of rewards to give their employer clients more flexibility. In 2023, the Rewards program is available for fully-funded employers and it will be available for self-funded employer clients in 2024.

As employers and payers seek to improve wellness program participation, focusing on expanding members’ options, redefining wellness, and restructuring program goals might lead to better outcomes.