Home > Employee Benefits > Massachusetts Wellness Tax Credit for small employers

Massachusetts Wellness Tax Credit for small employers

kates blogThe financial savings of a wellness program have long been debated between Human Resource and Finance professionals. Large employers, those with 100 or more employees enrolled on their medical plan, have the ability to monitor claims and thus view any improvement in claims.  Therefore, large employers have been more likely to institute a wellness plan since they are able to track the potential impact of a wellness program on their population’s health. Even still, this argument is often not concrete enough to convince large employers to spend the money required to see meaningful improvements in employee health.

Convincing smaller employers to institute wellness programs has been even more difficult. Since small employers are often partially community-rated and do not generally have access to claim data, they have no way of monitoring the efficacy of a particular wellness initiative. What would be their incentive do to so?

The state of Massachusetts unveiled a wellness incentive program for small employers, called the “MA Wellness Tax Credit”. Under this program, businesses with 200 or fewer employees, the majority of whom must work in MA, may apply for a Wellness Tax Credit of up to 25% of the costs associated with implementing a certified wellness program up to a maximum credit of $10,000 in a taxable year.

Employers can take advantage of the Wellness Tax Credit for 2013. Eligible businesses must have a Seal of Approval from the MA Department of Public Health prior to filing for the credit. The employer’s wellness program must meet eight components to qualify. Some of these components include:

  • an annual budget for wellness expenditures
  • a designated wellness champion
  • a formal communication of the program
  • employee awareness about personal health risks through a Health Risk Assessment (HRA) or biometric data collection

The credit will be issued on a first come first serve basis, so it is important to get your applications in now. All applications must be received by December 31, 2013 to qualify.

Corporate wellness initiatives are not going away. Whether employers want to help curb the rise of health care costs, increase productivity, morale or feel a genuine ethical responsibility to ensure and safeguard an employee’s health and well-being, a corporate wellness program is a path toward that end. If you are a small employer and have not committed to a corporate wellness program, the MA Wellness Tax credit is the perfect incentive to get going.

For more information on applying for the MA wellness tax credit, visit the Health and Human Services website.

Talk to your Client Executive at WGA for ideas about an effective and meaningful corporate wellness program.


About the Author

Kate O’Sullivan is a Client Service Manager at William Gallagher Associates in the Employee Benefits Practice. She is responsible for servicing a number of small, mid-size and large accounts, and works on the WGA Health Care Reform Committee.

617.646.0325 | KOsullivan@wgains.com | Connect with Kate on Linkedin
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