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Incentives and Lifestyle Spending Accounts (LSAs)

Explore the current and future state of incentives in employee well-being programs from the 2025 Employer Well-being Strategy Survey.

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May 20, 2025

2025 Employer Well-being Strategy Survey
This inaugural survey focused on the current and future state of employer well-being programs
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Key Takeaways

  • Most employers that offer incentives will maintain their funding in 2025, demonstrating consistent support even amid economic uncertainty. The median maximum incentive that an employee can earn is $600 annually.
  • For some (28%) employers, LSAs are a component of employee well-being strategies, reflecting an evolving preference toward flexible and personalized support.
  • A majority of employers will increase (29%) or maintain (46%) incentive amounts in the coming years.

Leveraging Financial Incentives for Employee Well-being in 2025

Financial incentives continue to be a significant element in promoting employee engagement in well-being programs. As illustrated in Figure 7.1, nearly three-quarters (74%) of employers use financial incentives or disincentives as part of their well-being initiatives. Notably, the median amount allocated per employee per year stands at approximately $600, with the majority of employers (74%) choosing to maintain or even increase their incentive levels in the next 3-5 years (Figure 7.2).

Figure 7.1: Employers' Use of Financial Incentives and LSAs, 2025 
Figure 7.1: Employers' Use of Financial Incentives and LSAs, 2025
Figure 7.2: Employers’ Incentive Strategy for the Next 3-5 years, 2025 
Figure 7.2: Employers’ Incentive Strategy for the Next 3-5 Years, 2025

With employers addressing upwards of six dimensions of well-being within their strategy, the level to which incentives are distributed across those areas is of interest. Among those who offer a well-being incentive, a median of 40% of the total amount is in exchange for completing a health assessment and/or biometric screening, followed by 30% to reward physical health activities (Figure 7.3). Incentive allocations to reward mental health and financial health activities were much lower. This finding could represent an opportunity for employers to align their incentive funding with high-growth and/or lower engagement areas of well-being.

Figure 7.3 
Figure 7.3: Distribution of Financial Incentives by Well-being Dimension, 2025

LSAs as an Employee Benefit

In an evolving benefits landscape, LSAs and well-being reimbursement accounts continue to be a topic of conversation. In 2025, 28% of employers will offer these accounts, demonstrating an interest in flexible benefit structures that empower employees to seek well-being opportunities that are important and relevant to them. Some employers also recognize these accounts as tools for enhancing employee satisfaction.

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A recent well-being success was a redesign of our LSA, expanding eligible expenses to support lifestyle and basic need. Our employees greatly appreciate leveraging their LSA for childcare, home fuel oil, work commuting costs and other expenses like massage or supplements to support their overall well-being. Every little bit helps these days.


- Laura Robbins, MaineHealth

More Topics

Resource icon_right_chevron_dark Voluntary Benefits icon_right_chevron_dark Culture & Strategy icon_right_chevron_dark Leave & Flexibility icon_right_chevron_dark
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