HRA’s). The HRA typically involves a series of health related questions which stubborn employees refuse to answer because of the time and effort required. In some cases, people worry that companies will use information against them down the line, but for the most part, employees are either unaware the HRA exists or prefer not to "waste their time" filling out a survey. To combat this resistance, many companies have begun incentivizing the process, offering cash or other desirable prizes for those who take the time to fill in their information, creating a baseline health report.
According to a 2010 study by the Healthcare Intelligence Network, top incentives for HRA completion are:
1. $25-$100 Cash
2. Lower premium/deductible
3. $101-$200 Cash/merchandise
5. $200+ Cash
Financially speaking, it makes sense that employers are more likely to offer $25-$100 cash than $200 as an incentive. It costs the employer less. However, research suggests less enticing incentives can be effective at garnering participation among employees and are more likely to lead to behavior change down the line due to innate human irrationality. Offering $1,000 cash to overweight employees who lower their body fat percentage over the course of a year might seem like an irresistible motivator, but emerging evidence suggests that when it comes to incentives, less is more.
The overjustification effect occurs when an incentive such as money or prizes decreases an individual’s intrinsic motivation to perform a task. The main reasoning behind the overjustification effect stems from cognitive evaluation theory. This theory proposes that tangible rewards (like money) are perceived as controlling or coercive. Instead of acting as reinforcement, the incentive actually serves to decrease perceived self-determination and undermine intrinsic motivation.
In terms of HRA’s, the promise of a large external reward ($200 cash) undermines any pre-existing drive within the individual to fill out the form. By comparison, we view a smaller incentive (like a t-shirt or key chain) as a nice bonus, but not as the full motivator behind completing the HRA.
With this in mind, companies can appropriately incentivize their wellness programs and maximize participation by taking these socio-cultural theories to heart.
Need help thinking up ways to effectively incentivize your wellness program? We’d be happy to help.