A large insurance benefit plan has been serving millions of members — including government employees, retirees and their families — across the U.S. for more than five decades. It recently expanded its long-term relationship with Alegeus in order to launch a more modern, flexible rewards program for its members.

The benefit plan initially partnered with Alegeus on a rewards program focused on COVID-19 vaccinations. When it analyzed the program, it recognized that its member population for this initiative skewed younger and healthier, and after soliciting feedback, it learned that these members preferred lifestyle-oriented rewards. Based on the learnings within this age demographic, the plan wanted to expand its rewards card capabilities to all members, regardless of age.

For well over a decade, hundreds of thousands of the plan’s members have used Alegeus’ carded wellness solution. Over time, the plan evolved and began offering a member rewards program with a new insurance product, providing credit to redeem items and services from select merchants. But administering a program with specific merchants created significant knowledge gaps and technical debt for the client to maintain over time. This was in sharp contrast to the ease of the carded solution implemented in support of the COVID vaccination program.

After seeing strong adoption by members in the newer insurance product, the plan wanted a configurable solution that could become the future of its more flexible rewards. They turned to Alegeus for a solution that could support features such as:

• Spending on qualified medical expenses with full IRS compliance
• Allowing spending at select merchants
• Swapping merchants in and out on demand
• Limiting the amount spent on flexible rewards to an annual cap while allowing additional spending on qualified medical expenses up to a larger balance

All of this would need to be done with one card, one portal and one benefits card number for the entire membership. And this was a significant new product to launch.

Alegeus consulted with the benefit plan to understand its current and anticipated programs. They determined that multiple purses could be used to implement changes without causing any disruption to existing offerings. The Operations and Go-to-Market teams collaborated with the plan to design a custom program to fit the unique needs of the business. To ensure a positive user experience, APIs were deployed to serve each member tailored content.

In addition, Alegeus created a custom interactive voice response (IVR) system with the same dynamic functions as the plan’s member portal. Balances could be read based on a single purse option, or a combined total balance if the member had multiple purses. For the benefit plan, it was important that its members knew what they could spend in total and what they had remaining as their flexible rewards.

The plan launched its new flex rewards program in October 2022. Despite being available for less than three months, the card program was the second most popular reward for that calendar year, surpassing redemptions for food delivery services, genetic testing and gym memberships.

Members have positively responded to the single integrated solution, which utilizes stacked accounts on the Alegeus platform in a way that gives them the flexibility to prioritize and purchase what they want. In comparison with all other reward options, it has generated high engagement, and because of its simplicity, the Alegeus contact center has received fewer calls from members.

Alegeus online portal engagements and card transactions drive a significant increase in clients’ engagement numbers every year. Flex rewards members in this plan widely adopted the card solution when the COVID vaccine incentive was launched in 2021. In December 2022, a peak redemption month, the newly expanded card generated more than 70 percent of reward redemptions.

Since the beginning of 2023, the number of redemptions has already exceeded other merchants’ total activity over the same period in 2022. It is anticipated that the card solution will lead to 3-4X more member engagements in 2023, which will assist members in making better and more proactive healthcare decisions.

The program is not even through year one, and with the flawless implementation and a more flexible approach to members’ spending, the client is already planning a move toward a larger, more flexible rewards program.