Points + Cash awards were a great value when Hyatt first introduced them several years ago. Much like traditional points-only award nights, the cost of an award was fixed even if the actual retail cost of the room was skyrocketing for a special event or peak tourist season. However, you could stretch your points further because you only needed to redeem half as many, plus a cash co-pay.
Essentially Points + Cash awards allowed you to “buy” the other half of the points you needed with the co-pay. They would count as qualifying nights, and they could be upgraded with a suite upgrade award. Before Hyatt made all award nights count toward elite status this was a big deal.
Expect to Pay Half Price
Now One Mile at a Time reports that Hyatt is adopting a formula much more similar to Hilton Honors. The cash portion of a Points + Cash award will be 50% of the current Standard Rate. This is often a higher, refundable rate than other discounted rates like AAA that you may be eligible for. The points portion will continue to be 50% of the regular points-only award rate. Changes will take effect for awards booked on or after November 1, 2018, providing a narrow window to book under current pricing.
Old Points + Cash Award Chart
|Hotel Category||Free Night Award||Points + Cash||Cost per Point Saved|
|1||5,000||2,500 + $50||2 cents|
|2||8,000||4,000 + $55||1.375 cents|
|3||12,000||6,000 + $75||1.25 cents|
|4||15,000||7,500 + $100||1.33 cents|
|5||20,000||10,000 + $125||1.25 cents|
|6||25,000||12,500 + $150||1.2 cents|
|7||30,000||15,000 + $300||2 cents|
* Cost per point saved is essentially a measure of what you are paying for the other 50% of the points with your cash co-pay.
New Points + Cash Award Chart
|Hotel Category||Free Night Award||Points + Cash|
|1||5,000||2,500 + 50% of Standard Rate|
|2||8,000||4,000 + 50% of Standard Rate|
|3||12,000||6,000 + 50% of Standard Rate|
|4||15,000||7,500 + 50% of Standard Rate|
|5||20,000||10,000 + 50% of Standard Rate|
|6||25,000||12,500 + 50% of Standard Rate|
|7||30,000||15,000 + 50% of Standard Rate|
This is not going to be a significant change for all hotels. There are some where the standard rate is quite reasonable. But the most expensive hotels will see the cash portion balloon. For example, the Points + Cash award chart used to top out at 15,000 points + $300 for a Category 7 property (instead of 30,000 points). If the standard rate at that hotel is $1,000 you can now expect to pay 15,000 points + $500.
You do not need to be staying at a Category 7 property. Even cheaper hotels can be hit like this. I was searching for a place to stay in Maui next year and found rates were often $900+ at the Hyatt Regency Maui, a Category 5 property that goes for 20,000 points. Previously the Points + Cash award would have been fixed at 10,000 points + $125. Now it could be as high as 10,000 points + $450 (or more).
No Better than All Points
There is now no good reason to book a Points + Cash award over a points-only award. The points-only award will always offer equal value. Let’s look at the math to see why.
As a general rule you should try to find redemption values above a certain threshold. It doesn’t matter what that threshold is as long as you consider it fair, but let’s imagine it’s 1.5 cents per point. If you find a hotel that you can book for $900 or 20,000 points, then you’re getting a good deal with points. The redemption value is $900 / 20,000 = 4.5 cents per point, or about 3X greater than your threshold.
Points + Cash awards used to be good because you could boost that redemption value even higher. Imagine you only had to redeem 10,000 points but paid $125. Now you’re getting ($900 – $125) / 10,000 = 7.75 cents per point.
Under the new model, you still have to pay 50% of $900, or $450, so you’re getting ($900 – $450) / 10,000 = 4.5 cents per point. It’s exactly the same redemption value as if you redeemed all points. If you consider that the standard rate is probably higher than the discounted rate you would have booked — imagine 50% of $950 — then you’re actually getting a worse redemption value with Points + Cash.
I can still see an argument for using Points + Cash awards to stretch your points further when you may not have enough for a full-priced award, but my verdict stands: The unique value that these Points + Cash awards used to offer has been dramatically diminished.