How health plan members can cash in on their plans’ benefits and incentives at their favorite retailers.
By David Vielehr, SVP & GM, InComm Healthcare & Affinity
Point-of-Sale Wellness, Explained
Point-of-sale wellness defines a new method of engagement that health plans are using today to help support their business model, and at the same time, encourage members to be active participants in living a healthier, happier lifestyle. Health plans and their retail partners have discovered that the best opportunity to help their members and customers make purchasing decisions that can directly impact their health takes place when they are physically inside their familiar retail environment. Leading health plans and retail partners are moving ahead on this opportunity by deploying point-of-sale wellness programs and making them a key piece of their member engagement strategy.
Market Need for Wellness Incentives and Rewards
The consumer’s lack of understanding of the basic building blocks that contribute to their personal health and their role in optimizing these components is a major driver of US health care costs. Research indicates a strong disconnect in consumers’ on-the-spot ability to rationally make decisions, often erring in favor of instant gratification over the smarter or healthier of the choices at hand. It is with this insight in mind that incentives were first employed in healthcare. Incentives have the power to incite a healthful action on behalf of the consumer, and to bridge the gap between instant gratification and the healthy choice; wellness incentives address both of those options simultaneously.
Wellness rewards and incentive programs come in many forms, but with one common goal: to shape behavior by assisting in members’ wellness decision-making, resulting in better overall health and more conscious lifestyle choices. For health plans, they are built with the end goal of helping plans reduce medical claim costs for avoidable chronic diseases as members shift from high-risk status to lower risk status.
Each year, these programs continue to gain traction, because they are a win for all stakeholders: the member, the health plan and the retailer. Members earn financial rewards for completing specific behaviors that improve their health and receive discounts on products they already love; the health plan, in turn, benefits from a reduced number of medical claims and a healthier, more engaged member base, along with improved member retention and acquisition. And the retailer benefits from increased foot traffic and sales.
Consumers Want Rewards and Incentives
Many recent studies indicate that rewarding for healthy behavior is a smart business choice: A 2014 Welltok survey revealed that 96 percent of consumers would change their behavior if they were rewarded. 75 percent of respondents agreed that they would view their health plan more favorably if it sponsored a program that rewarded members for healthy behaviors, adding that 81 percent would be more likely to renew with their health plan if a wellness rewards program were an option.
In addition, a 2013 Harris Interactive study revealed that 73 percent of consumers would lose weight if they were incentivized, while 75 percent would have their blood pressure checked. 51 percent would have their lifestyle choices scrutinized and participate in a plan to lose weight or control diabetes, while 68 percent would have their blood sugar or cholesterol checked. It is clear that ‘incentive-driven healthcare’ is not going away any time soon.
Deployment of Point-of-Sale Wellness Programs
Retail wellness incentives are designed to help improve behavior by rewarding positive choices, which can result in improved health, moving members in the direction of self- and preventative-care. These programs are built to bring personalized rewards to members in order to shape buying behavior and make members’ lives easier. By providing members with discounts on health and wellness items such as produce, vitamins, baby products and OTC medications, plans empower the consumer, making the healthy decision the easy answer.
Changing the Behavioral Economics of Food
Lessons from nutritional adjustments within the federally-funded SNAP and WIC Programs
The human diet plays an enormous role in overall health and wellness. Proper nutrition is one of the less expensive and more effective ways to fend off many chronic diseases and their associated risk factors. But food that is high in calories and low in nutrients tends to be cheaper and more accessible, making affordability of healthier foods more difficult for lower income families. It is no surprise that simply providing food subsidies does not change this fact. With this in mind, a study was initiated in 2009 on the federally-funded SNAP (Special Supplemental Nutrition Assistance Program), formerly known as the Food Stamp Program, and the WIC Program (Women, Infants and Children) to improve dietary intake among participants.
The study customized the products consumers were allowed to buy; for instance, participants were given vouchers aimed at increasing vegetable, fruit and whole grain consumption, while restricting certain foods high in fats and carbohydrates. Users would need to pay out-of-pocket for any foods not subsidized as part of the program.
A recent paper was published that analyzed the purchase data collected throughout the duration of the study, and the results showed that the use of financial incentives to gently encourage consumers toward healthier foods helped participants move away from their usual cheaper junk food alternatives. Directing consumers’ spend was found to not only urge them toward the healthier options, but also affected the entire shopping cart, including other goods purchased outside of the study in the same basket. Researchers found that a year after the program was implemented, purchase of the less healthy options dropped by 25%, while participants increased their whole grain, fruits and vegetable intake by 5%.
Upon reviewing the data, program administrators were most impressed by the efficiency of these financial rewards for short-term healthy behaviors that led to long-term behavior modification, as well as the ability of the initiative to help contain costs associated with diet-related chronic conditions.
Case Study: The Consumer Experience and the OTC Network®
Jane is 68 years old. She has been struggling to manage her Type 2 diabetes for over two decades, taking insulin therapy in addition to an oral medication, exercising often, and trying to eat healthy as much as her budget permits. She frequently shops at CVS and stops by the pharmacy on her way out for any prescriptions. CVS is two blocks from her house and has provided a quick and easy shopping experience for her for many years.
Jane’s health plan has teamed up with InComm Healthcare & Affinity to provide her with an OTC Supplemental Benefit Card that is loaded monthly with her Medicare Advantage benefit dollars. As a result, Jane may now use her health plan benefit card towards item purchases at CVS and many other favorite retailers, to bring home her diabetic multivitamins, as well as a number of other OTC items such as bandages, sunscreen or Aspirin. She can also pick up supplements and Kleenex on her way out and will be more inclined to do so, because her plan has provided her with discounts on a number of specific everyday products, with the swipe of the same health plan benefit card at checkout.
Jane is grateful that her health plan is committed to helping her manage her health, and understands the ongoing struggle of the daily burdens of diabetes management. She returns home inspired to eat healthier, feeling grateful that she is playing her part in self-health management, while also remaining budget-conscious.
InComm Healthcare and Affinity are experts in helping health plans inspire behavior change in their members through retail incentives and rewards programs. For more information on InComm Healthcare & Affinity’s point-of-sale wellness platform, please visit www.incommIHA.com.
About the Author:
David Vielehr is a Senior Vice President at InComm, the largest prepaid payment technology company in the world, and also General Manager of InComm Healthcare & Affinity (IHA), InComm’s fast-growing healthcare division. In this role, Vielehr is responsible for IHA’s Enhanced Payment Platform and the multiple channels that are served by the technology. Vielehr has extensive experience working with retailers, consumer packaged goods companies, health plans and membership organizations.
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