How Member Rewards Programs Can Make or Break Health Plan Performance

The secret to unlocking higher quality ratings and reducing the costs of care relies on the ability to address health and wellness behaviors at a member level. Plan performance is driven by each member’s willingness to educate themselves about their health and seek care in a timely manner. Member enthusiasm for healthy activities and ongoing education increases when the plan finds the right ways to motivate members. That’s where incentives come in.

Incentivizing the right healthy behaviors with appropriate motivation allows health plans in all markets to meet members' needs in a scalable and sustainable way. Pairing healthcare rewards with healthy activities is an effective method of transforming member behavior and encouraging them to get the care they need. Health plans that understand their members' needs and build strategies that address their daily challenges are on the right path to boosting plan performance.

How Rewards Improve Healthy Behaviors

Motivating members to complete healthy activities requires overcoming widespread distrust in the healthcare industry, socioeconomic barriers to care and their personal behaviors that hinder wellness.

Human behavior dictates that health plan members will focus their time and attention on personal day-to-day needs: paying bills, putting food on the table and taking care of family members. It is very easy for them to avoid important health activities like cancer screenings or annual physicals to focus on more pressing concerns, especially if they lack the time, knowledge and resources to seek the right care. Helping members understand the benefits of completing healthy activities and provide the right encouragement can go a long way to getting members engaged in their health.

When paired with informative and personalized messaging, rewards and incentives are powerful tools for motivating members to invest in their healthcare. Member engagement programs benefit from pairing rewards with healthy activities by creating an immediate financial incentive to improve health outcomes. The easier it is for members to complete healthy activities and redeem rewards, the more likely they will engage with their care regularly.

Deciding which healthy activities to incentivize will vary depending on several factors. While it is tempting to reward every HEDIS measure, budgetary restraints may limit you to only a handful of high-value activities. Or you may determine that only specific care gaps need addressing while others are already seeing continuous improvements, allowing you to bolster the incentives to close the remaining care gaps.

As you strategize about how to structure your rewards program, you should also ensure that you have a clear understanding of the federal and local regulations for rewards and incentives.

Regulatory Requirements for Rewards and Incentives

The Centers for Medicare and Medicaid Services (CMS) allows health plans to incentivize members with rewards to complete health activities, but plans must follow strict guidelines about what rewards they can offer, how they can promote rewards and what activities can be incentivized.

CMS provides funding to Medicare Advantage (MA), Medicaid and Dual-Special Needs Plans (D-SNP) to support their efforts to improve member health outcomes and provide members with healthy tools and resources. This money can be used to support rewards and incentives programs, meaning government funds may directly pay for gift cards and merchandise that motivate members to live healthier. Ideally, health plans should motivate members with healthy rewards, such as fresh produce, fitness equipment and at-home medical monitoring tools. As a result, CMS requires MA and Medicaid plans to control how members use rewards, often by prohibiting purchases of certain merchandise.

Starting in 2022, MA plans were barred from offering members Amazon gift cards due to the lack of control over how members spend rewards. Similarly, Walmart gift cards and pre-paid VISA cards faced heavy scrutiny from CMS and can only be used as incentives if plans can prevent members from purchasing certain products, such as firearms and alcohol. In these same regulations, MA plans were also required to create equitable access to rewards program by notifying all qualifying individuals that they can earn rewards.

Medicaid and D-SNP plans are also subject to state regulations and may have further restrictions.

When building a member rewards program, plans in all markets must be aware of the federal and local guidelines to avoid financial penalties and sanctions. Failure to comply with these regulations may have an impact on plan performance.

What Rewards are Most Attractive to Members?

Members are most incentivized by rewards that directly address their immediate needs and daily concerns, such as buying groceries, taking care of children and offsetting the cost of medical expenses. Healthmine data shows that the most popular rewards are gift cards to grocery stores. Gift cards allow members to quickly purchase fresh food from local stores or order food online to reduce the stress of shopping for, preparing and acquiring meals.

But plans should not limit their members to just grocery stores. Working with a gift card vendor that can instantly redeem rewards for national chains and local retailers goes a long way towards improving member experiences. Plans that limit their gift card selection to a handful of big brands may discourage members in food deserts or rural communities from completing health actions because they cannot easily use their rewards at local stores.

Gift cards are not the only type of reward that members want. Merchandise like the latest technology, high-quality medical equipment and new clothes can brighten a member’s day, provide support for needs outside of groceries, close wealth gaps and increase their willingness to improve healthy behaviors. Including merchandise in a rewards program gives a member the ability to decide how they spend their rewards and work towards redeeming a product they are interested in.

For plans looking to address specific social determinants of health like food insecurities, offering members food boxes or meal subscription services gives them access to fresh produce. This type of reward is particularly beneficial to members who live in food deserts or do not have time to regularly go shopping for groceries.

When deciding on what healthcare incentives to include in a rewards program, plans should consider:

• Digital and physical gift cards to national brands and local retailers
• A wide variety of merchandise, such as fitness equipment, electronic devices and appliances
• Reloadable FLEX cards
• Food boxes
• Subscription services
• Family and childcare products, such as diapers, car seats and children’s toys

Why Wellness Incentives Benefit Both Members and Health Plans

Investing in wellness incentives and member rewards programs enables plans and members to improve healthy behaviors and accelerate quality improvement initiatives. Driving members to complete healthy activities, especially for heavily weighted quality measures, can have a powerful impact on plan performance, especially for MA plans looking to improve Star Ratings.

Rewards also provide plans with creative solutions that address SDOH and inequities in healthcare, such as poverty, food insecurity and gaps in education.

At the member-level, rewards incentives members to become involved in their healthcare. By giving members a financial reason to attend appointments, they are more likely to speak to their doctors on an annual basis, increasing their ability to identify new ways to improve their wellness and health. Members may even learn there are eligible for further health activities and opportunities to earn rewards with their plans, creating a feedback loop.

Building Impactful Rewards Programs with Healthmine

What type of rewards program you implement to motivate your members will vary widely based on your members’ needs, your budgetary constraints, local and federal regulations and your desired quality outcomes. Aligning a reward vendor with your quality goals requires a strong technical infrastructure to ensure the health outcomes you want to target are properly supported with the right incentives. Rather than standing up a potentially costly and ineffective rewards program alone, consider working with a digital health partner who already has a foothold in the rewards and engagement space.

Healthmine’s rewards and incentives technology solutions give health plans access to sophisticated digital tools for designing, implementing and monitoring healthcare rewards programs. Plans can curate what activities they want to incentivize and incorporate rewards from a wide variety of retailers, including third-party vendors that specialize in delivering customizable reward boxes. At all stages, Healthmine-powered rewards programs are supported but professional team of account managers who monitor quality scores, care gaps and incentive fulfillment rates to ensure our clients get the most out of their investment.

Explore how to use a Healthmine supported member rewards programs to improve health outcomes and quality scores. Contact us for a demo.