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Are health incentives unfair?

By Jay MacDonald · Bankrate.com
Tuesday, November 29, 2011
Posted: 10 am ET

Since employer-sponsored health insurance programs apparently haven't moved the needle by offering premium breaks to workers who stop smoking and shed the pounds, corporate America has decided to pick up the stick instead.

A new report by Towers Watson found that employer policies that charge higher premiums for smoking, obesity and high cholesterol have doubled in the past two years to 19 percent of the 248 major corporations surveyed. The authors expect those numbers to double yet again next year.

Academics, benefits administrators and union leaders have all voiced concern as such major corporations as Wal-Mart Stores Inc., PepsiCo Inc., Home Depot Inc., Lowe's Cos. and Safeway Inc. rolled out programs that penalize unhealthy lifestyles rather than merely encourage healthy ones.

Businesses contend that the stick approach is fair because those with unhealthy lifestyles consume an inordinate share of health care benefits, thereby driving up the insurance costs for their employer and fellow workers.

But a number of groups, including the American Cancer Society and the American Heart Association, have warned the feds that lax oversight could create a "back door" through which employers could discriminate against unhealthy employees. Some maintain that increasing premiums on this particular risk group could cause the workers who need health insurance the most to decrease their coverage or even drop their policies entirely.

Wal-Mart raised eyebrows recently when it increased premiums $2,000 a year for some smokers. Other megacorps had been content with modest hikes; Home Depot dings smokers $240 a year, PepsiCo $600 annually.

The move was widely seen as an acknowledgment that when it comes to reeling in its health insurance overhead, big business is prepared to resort to the stick when the carrot proves ineffective.

Carrots didn't work for UnitedHealthcare Group, which dropped its Vital Measures program three years ago due to lack of interest. The program had enabled workers to pare down their deductible amount by achieving health goals.

Current health insurance regulations allow large companies to charge up to 20 percent more to higher-risk employees. Health care reform bumps that number to 30 percent in 2014, and potentially as high as 50 percent.

Question: Do you think it's fair to hold a worker's weight, cholesterol level and/or nicotine use against them in this way?

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7 Comments
CP
December 01, 2011 at 4:28 pm

When did personal responsibility become a dirty word in this country?

CP
December 01, 2011 at 4:28 pm

"I dont think it's prudent to penalize people for life style choices."

And nobody is punishing them for their lifestyle choices. We are only asking that they pay for their choices themselves instead of passing the bill onto the rest of us.

CP
December 01, 2011 at 4:26 pm

John,

I dont think comparing procreation (also known as propogating our species) is comparible to smoking. Straw man arguments arent going to sway people who actually actively attempt to stay healthy, but nice try.

And yes, excessive drinking should be treated the same as smoking.

I dont think it is prudent that the responsible have to pay for the irresponsible. If people CHOOSE to drink to excess, smoke, do drugs, or eat McRib sandwiches until their hearts explode (hilarious Wolverine) then they also CHOOSE to live with the consequences. It isnt as if the negative effects of those things are a secret.

Wolverine
November 29, 2011 at 3:43 pm

2/3 Americans are obese.
Wanna bet who are the ones complaining about it being "unfair"?

Come on now, the buck has to stop somewhere.

It's bad enough that they are missing more days at work than I do because they like to stake out the McDonalds for the McRib to come back, but it comes out of my pocket because their heart is about to explode with the very next one they might eat?

And not only that, but (separate rant) I'm sick and tired of being looked at because I want to take a 5 minute break just to get away from my desk, while smokers aren't even looked at when they are taking 15 minute smoke breaks every hour.

I don't think so.

If they chose to stick with those unhealthy habits, then they can choose not to.

John
November 29, 2011 at 3:24 pm

Isn't having a baby a choice? Should we foot the bill for you're choice to reproduce? How about your alcohol consumption? That can cause liver disease. What about Tanning?. This is clearly a form of discrimination against how you choose to live your life. I dont think it's prudent to penalize people for life style choices. We all make bad decisions sometimes that would in some way or another affect insurance rates. Why punish only sub-groups.

CP
November 29, 2011 at 2:37 pm

I agree with Shannon. Nicotene use is a choice. If someone chooses to use it, they should foot the bill. I dont want to pay for someone elses risky behavior.

Cholestorol is a trickier matter. Some people are predisposed to having high cholestorol (even if they eat right and exercise). Not sure if they should be punished for that.

Weight, again, is tricky. Heavily muscled people can be considered too heavy for their height, but are not "obese". I would say body fat percentage would be a fairer method, but that number isnt readily available for most people.

Shannon
November 29, 2011 at 11:34 am

Yes. I don't smoke. I'm not overweight. I don't have high cholesterol or blood pressure. I eat right and work out. People are entitled to live the lifestyles they chose, but why should I be stuck with the bill?