Wellness fund guide

How to use your company's wellness fund before it expires

A plain-language guide for HR and benefits teams: what a carrier wellness fund is, what it can pay for, how payment works and how to put it to good use.

What is a wellness fund?

A wellness fund is money your health insurance carrier sets aside for your company to spend on employee health and well-being. You might also hear it called wellness dollars, a wellness credit, a wellness allowance or a health improvement fund. They all mean roughly the same thing.

The idea is simple. Carriers want healthier, more engaged members, so they give employers a budget to run wellness programs. The fund is usually part of your group health plan agreement, and the amount depends on your carrier, your plan and the size of your group.

Wellness programs are common. In KFF's 2024 Employer Health Benefits Survey, 79% of large firms and 54% of small firms that offer health benefits had at least one wellness program, like smoking cessation, weight management or lifestyle coaching. A wellness fund is one of the easiest ways to pay for that kind of program without touching your own budget.

How to find out if you have one

Many HR teams don't know they have a wellness fund until someone mentions it. Funds are most common with fully insured plans, and they're often agreed on at renewal. The quickest way to find out is to ask:

  • Your benefits broker or consultant. They usually know what was negotiated in your renewal.
  • Your carrier account manager or client experience consultant. They can confirm your balance, your deadline and the rules for using it.
  • Your renewal paperwork. Look for terms like wellness fund, wellness allowance or wellness credit.

When you ask, get three answers: how much is available, when it expires and how the carrier wants to handle approval and payment.

What you can use it for

Each carrier has its own guidelines, but wellness funds generally cover things that help employees build healthier habits or learn about their benefits. Common examples include:

  • Wellness events, health fairs and lunch-and-learns
  • Fitness, step or walking challenges
  • Flu shot clinics and biometric screenings
  • Health education materials and benefits communications
  • Employee wellness boxes built around a health theme

What usually doesn't qualify: cash, gift cards, alcohol or general celebrations that aren't tied to a wellness goal. When in doubt, send your carrier a quote and ask before you buy.

Many carriers also want the spend tied to a specific wellness initiative. See how to pair your wellness boxes with an initiative for ideas.

Wellness boxes are a popular choice because they reach every employee, including remote and field teams, and each box can include printed information about your EAP and other benefits. That makes the spend easy to connect to a real wellness goal.

When it expires

Most wellness funds are use it or lose it. They typically follow your plan year, and any amount left at the deadline doesn't carry over. That's why many companies end up rushing in the fourth quarter.

  • Check your deadline early. Put it on your calendar the day you confirm your balance.
  • Work backward. Leave time for carrier approval plus production and shipping. For boxes, plan on about 4 to 5 weeks.
  • Watch for carrier changes. If your company is switching carriers, you usually lose access to the current fund. Spend it before the switch.

How payment works

Carriers handle payment in one of two ways, and some let you choose. Ask yours which one they use.

Carrier pays the vendor directly

The carrier approves the expense and pays the vendor's invoice from your fund. Nothing comes out of your company's budget, even temporarily.

You pay, then get reimbursed

Your company pays the vendor's invoice, then sends the paid invoice to your carrier. The carrier reimburses you from the fund based on its guidelines.

HealthBoxed offers carrier-direct billing and regularly receives payment straight from carriers, so that is usually the simplest route. If your carrier prefers reimbursement, we'll send you everything you need to submit.

Wellness funds by carrier

The basics are the same everywhere, but each carrier has its own name for the fund and its own way of paying. These guides cover the carriers we work with most:

How to use your wellness fund, step by step

  1. Confirm the details. Get your balance, deadline and approval process from your broker or carrier.
  2. Pick a goal or theme. Think about what your team needs most right now, like stress relief, sleep, healthy eating or getting ready for open enrollment.
  3. Set a budget per employee. Divide the amount you want to use by your headcount. That number guides what can go in each box.
  4. Request a proposal. Tell us your theme, headcount, budget and delivery date, and we'll send a custom proposal within 1 business day.
  5. Get carrier approval. Send the proposal to your carrier contact. We can coordinate with them directly if that's easier.
  6. We handle the rest. We pack and ship the boxes, include your printed materials and invoice the carrier or your company, whichever your carrier prefers.

Ideas through the year

Tying your spend to a theme or awareness month makes it feel timely to employees and easy to justify to your carrier.

  • Winter: New Year, New Me goals, immune support and cold weather activity
  • Spring: stress awareness, spring renewal and getting active outdoors
  • Summer: sun safety and outdoor activity
  • Fall: open enrollment, gratitude and holiday wellness, plus a final push before year-end deadlines

Mental health, sleep, healthy eating, heart health and dental wellness work any time of year.

For benefits professionals

If you're a broker or carrier rep, wellness funds that go unused are a missed chance to show clients value. A simple, ready-to-approve option makes it easy for clients to act before their deadline. You can refer a client to us and we'll take it from there, keeping you in the loop the whole way.

Common questions

Does every company have a wellness fund?

No. Wellness funds are usually tied to fully insured group health plans and are set up between your company and your carrier, often at renewal. Your broker or carrier account manager can tell you if you have one, how much is in it and when it expires.

Do unused wellness funds roll over?

Usually not. Most funds follow your plan year and any amount you don't use by the deadline is gone. If you switch carriers, you typically lose access to the current carrier's fund too, so plan ahead if a change is coming.

Do I need approval before I spend it?

Most carriers want to approve the expense before you buy. A common approach is to send them a proposal or quote first. Our proposals are built to be easy to submit for approval.

Can wellness funds pay for employee wellness boxes?

In most cases, yes. HealthBoxed is an approved wellness fund expense with all major carriers, as long as the boxes support a wellness theme. Your carrier's rules still apply, so it's worth confirming with them first.

How does payment work?

There are two common ways. Either the carrier pays the vendor directly, or you pay the invoice and send the paid invoice to your carrier to be reimbursed. We're set up to bill carriers directly and can work either way.

How far ahead should I plan?

Give yourself at least 4 to 5 weeks before your delivery date for boxes, plus time for carrier approval. If your fund expires at the end of the year, starting in early fall gives you the most room.

Can we ship to remote employees?

Yes. We can ship boxes to employees' homes, to office locations or a mix of both.

Ready to put your wellness fund to work?

Tell us your theme, headcount and budget, and we'll send a custom proposal you can submit for approval.