McDonald’s Employee Wellness Portal is Taken Down

McDonald’s closed down their employee wellness portal last month, one that offered health resources for its workforce as well as other information through an intranet type offering. It has been speculated by the media (see CNN’s McDonald’s on employee resources site: Not lovin’ it) the site was shutdown in part because it advised McDonald’s employees not to eat its own food on health grounds. The site, which was not accessible by the public, showed photos of what it called “healthy” and “unhealthy” choices. The problem was that, while items like salads and sandwiches were encouraged, cheeseburgers and fries were labeled “unhealthy.”

McDonald's Employee Wellness Portal

McDonald’s online resources, known collectively as McResource Line, have had other problems in the past as well. In July, it was revealed that a guide aimed at helping employees plan their budgets omitted items such as gas and food. The online tools also allowed employees to provide details of how much they earned from second jobs, something seen as a tacit admission by the company that its wages were inadequate for most of its workers to live on. More recently, guides on how to tip au pairs and housekeepers were seen as further evidence that the company is out of touch.

This story highlights the challenges some companies face leading by example. McDonald’s was undoubtedly trying to provide useful services for the betterment of their workforce,  however this effort had inherent tension with the unhealthy nature of much of the food on which it relies for most of its sales. Although McDonald’s food is cheap and popular, is tends to be high in salt, sugar, and saturated fat. Current basic wisdom regarding wellness suggests high caloric diets, like the composition of many McDonald’s meals, may contribute to obesity and other health problems.

McDonald’s admitted in a statement on its public website that the McResource Line site had been shut down, saying that it had re-evaluated its worth in the light of recent events, and asked that the third-party vendor take it down. It further stated that the commentary and scrutiny the site had attracted was unwarranted and unfair.

Affordable Care Act Boosts Wellness Programs

The Patient Protection and Affordable Care Act (ACA) introduced new provisions that promote wellness programs. These include implementing nondiscrimination programs (in other words, programs that can benefit anyone, not just the sick) and increasing the maximum reward limit for group health plans. These changes went into effect this year. The new provisions are applicable to health plans that are grandfathered, as well as most non-grandfathered plans.

The ACA provisions continue to support two available reward categories. Participatory wellness programs which allow for rewards that do not consider the individual’s health status – such as fitness center membership discount. Conversely, health-contingent wellness programs which provide rewards based on meeting a specific standard relating to an individual’s health, for example tobacco use reduction.

These new provisions increase the maximum reward for health-contingent wellness programs to 30 percent of health coverage costs (up for 20 percent). These new regulations also cover what a reasonable alternative standard is for health-contingent programs. Employers are afforded some flexibility when forming reasonable alternative standards. For example, they now can communicate with an individual’s physician for recommendations on alternatives.

So how can employers benefit from these new provisions? Many will aim to modify major medical plan premiums, since they are the biggest voluntary income deductions of employees. However employers should also think about having flexible spending accounts (FSAs) and health reimbursement accounts (HRAs), which potentially could be more impactful. For instance, a $20 reward added to a major medical plan premium each month might go unnoticed as many employees are already making monthly contributions worth hundreds of dollars. However, adding extra money to a health FSA or HRA makes more money available for out-of-pocket expenses which generally get observed more than deductions from a paycheck.

Wellness programs also provide a good opportunity to cut down on medical plan costs. A review of the major health risk factors in a workforce can be performed. Then the employer can tailor their wellness program to concentrate on and address these factors. The employer can also evaluate their workforce’s progress and make beneficial adjustments along the way. A good wellness program includes both participatory and health-contingent components.

Economic incentives have been shown to motivate workforces. As the law sets now, any cash rewards are probably going to be seen as taxable income if not used directly for health. Therefore, placing part of the rewards into flexible benefits is something to be explored. When funding FSAs, don’t allow the option of getting cash (or other taxable benefit) and the reward won’t be a factor in the ACA salary deduction contribution limit (which as of 2014 is $2500). There are no such limits for HRAs.

When you incorporate a wellness reward into a health FSA or HRA, you need to take into account the four forms of nondiscrimination regulations:

As well as the limits for reward size, the regulations require that employees must qualify for a reward at a minimum of once per year. Employers need to make the reward uniformly available and provide a reasonable alternative standard if it is difficult for an employee to meet a set standard due to a medical condition. The employee should not have to pay for the alternative (the food costs associated with some diet programs are a notable exception). The program also has to be reasonably designed for health promotion or disease prevention. It cannot be used to discriminate against a particular health factor.

2) Americans with Disabilities Act (ADA)
In 1992, the Equal Employment Opportunity Commission (EEOC) declared that wellness programs need to be voluntary, but they did not elaborate on this. In 2012, when asked by the American Bar Association, the EEOC said they have not taken a position in regards to whether programs are made involuntary if financial incentives require disability-related inquiries or medical examinations. Information that is collected needs to meet ADA confidentiality rules. Discrimination against people with disabilities is not allowed.

3) Cafeteria plans
Under a cafeteria plan, a health FSA counts as a qualified benefit, but not an HRA. Funding a health FSA with a wellness reward may be problematic with the key employee concentration test, which does not allow cafeteria plan benefits for a key employee to exceed 25 percent of the benefits for the total number of employees. Assessing a reward in relation to these limits is necessary.

4) Self-insured plans
The benefits test for self-insured plans need to be considered. Take for example an employer who places $1000 into the health FSA or HRA of all their employees as an incentive; what if there are some highly compensated employees who meet the standard and some who don’t? This issue is not necessarily addressed by the current nondiscrimination rules, but the rules enable optional benefits if all eligible employees choose the option and everyone has the same contribution.

If an eligibility test is not met, then providing a wellness reward can increase the number of employees taking part in a health FSA. A wellness program can make flexible benefits more useful, which will lead to more participation in the program, which is a smart and healthy option for everyone. The information above was adapted from the SlideShare presentation below, please take a look for further information on this topic.

Microhealth Rewards

What are Microhealth Rewards?

The microhealth reward is a recycled innovation being reintroduced by way of the Affordable Care Act as a means of trying to motivate Americans to engage in healthy behaviors through extrinsic economic rewards. The way the law is currently written these monetary benefits can be marketed as either perceived rewards or penalties, but the basic premise of the expanded scope of these type of rewards equates to reductions in the cost of health insurance premiums if an individual is able to stay healthy (and in some cases prove it).

The way microhealth rewards will ultimately be adopted is still being played out. Monetary rewards for group challenges that fall under the realm of “participatory wellness programs” are nothing new, but there is empirical evidence to suggest that these types of rewards do not work (see Daniel Pink’s book Drive for a thorough investigation of this). Participatory wellness programs are usually available to any employee and can include incentives such as free or discounted fitness center memberships, free attendance to health education seminars or free health risk assessments.

Microhealth Rewards

“Health-contingent wellness programs” on the other hand offer microhealth rewards based on measures and outcomes. For example, you might receive a financial reward if you meet certain biometric requirements over time (ex. low cholesterol levels). Let’s say you move from an overweight BMI measure to a normal BMI measure within a given period of time, your employer will be able to offer you a financial incentive for your effort. You can also get rewards if you participate in certain activities and/or opt-in for services such as flu shots or regular visits with your doctor.

The expanded rewards that you can earn through a microhealth rewards program will now run the gamut, from  gift cards for meeting activity goals to reductions in the total cost of your health insurance premiums for sharing biometric data with your employer (it is important to note here that all Americans are protected by HIPAA and that these are opt-in programs. An employer cannot force you to have to share medical information with them).

Microhealth rewards are another measure to inspire healthcare providers to become accountable care organizations (ACOs). ACOs do not use the traditional fee for service model that is common among more traditional health care organizations. The Affordable Care Act is encouraging health care programs to move towards incentives that reward people (as well as insurance providers and healthcare organizations) for preventive health measures over treatment. The spirit behind this innovation is that there is a significant body of evidence to suggest healthy people spend less on healthcare (see: Health and Wellness Research Study: Corporate and Worksite Wellness Programs). However, as I have stated earlier there is also a significant body of evidence to suggest that wiring people to be extrinsically motivated to stay healthy also has considerable drawbacks. Therefore, it will be important to stay on top of how these rewards perform and adjust so that their potential for benefit is optimized.

Microhealth rewards was heralded at this year’s Health 2.0 Conference as a major upcoming trend in health and wellness. Personally, I believe it will be one of the most significant innovations in health and wellness in 2014.