financial incentives to being healthy for insurance purposes anyway

October 26th, 2007

Financial Incentives To Being Healthy (For Insurance Purposes, Anyway)

So that meeting about health insurance that my spouse was going to that I wrote about yesterday? Well, my spouse bailed on the meeting because he was afraid he would not pay attention and I would ask him many questions afterwards he couldn’t answer, so he took care of the kids and I went to the meeting instead. And good thing I did, because there was a whole lot of information presented in the most boring way possible, and my spouse would have napped. I’ll get into a lot of the nitty gritty numbers part later, and how a bank rep tried to sell me on an HSA being equivalent to a retirement account, but all that is for another post (or posts) in the near future. Right now, I want to discuss my spouse’s employer’s “Wellness Incentive Program”, one of the new changes that can really benefit us specifically, but is it a good direction for health insurance to be moving overall as a general policy?

Last week I read a post at Gather Little By Little about an employer charging more for health care coverage if certain health criteria were not met. I never dreamed that a week later, I’d be sitting in a meeting where my spouse’s employer basically told me the same thing about our health coverage. It was couched in different language, as “incentives” off the normal price of premiums for meeting certain criteria instead of as penalties, but it amounts to the same thing. Starting January 1st, if my spouse meets 5 wellness criteria, he will get $50 off his health insurance premium every pay period ($10 for each incentive). If he does meet all 5 criteria, our premium will actually end up being $30 less than it is right now before any rate changes go into effect. And I was expecting a big rate increase…

The criteria are:

  • Completion of the Wellness Screening (scheduled through and paid for by his employer)
  • Non Tobacco Use
  • Blood pressure below 135/87
  • BMI under 30
  • LDL cholesterol less than 150 mg/dL

These criteria will get more stringent over the next several years until they are in accordance with the NIH standards (BMI less than 25, LDL cholesterol less than 100 mg/dL, blood pressure 120/80 or below). There are provisions for if your doctor signs a note saying it would not be advisable for you to meet a particular criteria, and you can also enter a program to treat a criteria you do not meet and still qualify for the $10 credit per criteria.

Privacy issues were also addressed – the results of the screening will not be disclosed to my spouse’s employer, only the number of credits (not which credits, just a number from 0 to 5) to apply to payroll. And he can earn credits through entering a treatment program for any issue he does not pass so he can have 5 credits even if he doesn’t pass all 5 and no one would know the difference as far as his employer is concerned.

For us, my spouse will be doing the wellness screening, does not smoke, and his blood pressure and BMI are under the current limits. His cholesterol should be under the limit too – his last cholesterol test was deemed “fine” by his doctor. Not being the detail man, my spouse never asked for the actual numbers but I assume “fine” is below the limits in this program. So it should provide us with a $50 per pay period credit and actually save us money on our health insurance premium next year compared to what we pay right now. If my spouse does not pass a criteria he will definitely be taking the recommended steps to qualify for the credit as well as improve his overall health – these starting limits are very generous and if he does not fall under them, I feel like he should be trying to improve them for his health’s sake if not for the monetary incentive.

I can see how this program might be seen as a form of discrimination though – and although the plan rep compared this to being charged more for auto insurance if you have a poor driving record, health is a little more complicated than that. I like that we will benefit from the program (because I love to save money) but I wonder about the ethics of charging more to people who have health issues. It isn’t black and white exactly – as I said, you can enter treatment programs prescribed by a doctor to earn credits you might not qualify for, but still, it seems to tread a line I’m not sure I am comfortable with. If they decided to choose asthma as an incentive criteria, well, we’d be out of luck because my spouse has asthma which he treats via inhaler every single day. Which leads to a whole other discussion about the topics of the meeting…

That ninety minute meeting I attended has provided fodder for at least three blog posts I think… it was long, and boring, but full of things that made me almost laugh out loud at the absurdity of the world. In the next few days I’ll discuss the “traditional” plan option vs the HSA/high deductible plan, and how statistics and “savings” can be manipulated in a presentation to tell whatever story you want it to. As well as how an HSA can be presented with a straight face by a bank employee as a viable alternative to a retirement account and yet a whole room of seemingly intelligent people don’t laugh out loud (I did snicker). Maybe I’m missing something ;) .

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17 Responses to “Financial Incentives To Being Healthy (For Insurance Purposes, Anyway)”

  1. I agree that this new wave is certainly a mixed bag. Part of the issue for me is that although I take good care of myself, what about the conditions I’m predisposed to because of genetics – like the cholesterol that shows up high but I’m very health, and is the same as my grandparents and parents? That’s where it gets sticky – for those people that are taking good care but their bodies aren’t cooperating, like my mother-in-law who has always been the healthiest eater I know and gets lots of exercise but her BMI is still WAY over 30 and her doctors are simply perplexed – for those people it does seem a little unfair. But all in all I do see the point – it’s a way of giving incentive to people to take better care of themselves therefore costing the insurance, the employer and ourselves less money on the healthcare side of things.

  2. Mmm, this is interesting. I come from the UK (NHS) and currently live in Canada (Medicare) but am considering moving with my partner to the US in a few years time and health insurance is a big issue for me as I have a pre-existing lifelong condition, so I’m fascinated to hear about others experiences. This appears reasonable on one hand- why should you pay the same as the 400lb chain smoking, mcdonalds muncher in the next office. On the other hand I can’t help feel it could be the start of a slippery slope. Also how do they define wellness screening? If it includes lung function tests, maybe your spouses asthma would preclude him from that credit? There is a big difference from self induced medical conditions (over-eating, smoking, excessive drinking) and those of us blessed with poor genes or a wheezy chest. I’m intrigued to hear more.

  3. It is a mixed bag indeed. I’m still sifting through my feelings on the whole idea. Thanks for sharing!!

  4. @Looby – for us specifically, the “wellness screening” test credit is simply if he does the wellness screening, no matter what the result, he gets that credit. But yes, in the future there is no telling what might get added to the wellness credits, asthma could very well preclude him from a discount in the future. Slippery slope indeed.

  5. That’s how my employer is doing it as well — not as detailed though. I think it’s a great way to reduce cost for people who are healthier and are less of a burden on the program. It is also a good incentive for everyone to try and be healthier.

    $50 per pay period? That’s a lot!

  6. $50/pay period is a lot! My spouse’s employer tries to be very fair and good to their employees generally. They are a company so of course they look out for their bottom line but we feel lucky to be associated with them.

    They try. More than some.

  7. My employer has a wellness incentive program as well that in the plan year 2010 are rolling out a $150 discount off of the deductible in addition to a $200 cash incentive for participating in a wellness program. Luckily I don’t have to meet any certain body requirements, etc… that seems a bit harsh to me. I think it’s great though that employers are now offering incentives for living a healthier lifestyle.

  8. I was wondering what are the names of these employers that do this? I have not heard of it and was interested that companies actually do it.

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