Smokers and Unhealhly Will Pay Healthcare Penalty

Smoking (Photo credit: Wikipedia)

Many employers are asking that workers who smoke, are overweight or have high cholesterol pay a larger percentage of their healthcare costs, what some insurance companies call a healthcare penalty. It's a shift toward penalizing employees with unhealthful lifestyles instead of rewarding good habits.
Policies that enforce financial penalties on employees have doubled within the last two years to nineteen percent of 248 major American companies recently surveyed. 

Next year, The practice among employers with at least 1,000 workers was expected to double again.

Additionally, a survey released by Mercer, which advises companies, indicated that about a third of employers with 500 or more employees were attempting to coax them into wellness programs by extending financial inducements, like discounts on their insurance. 

As yet, companies including Home Depot, PepsiCo, Safeway, Lowe’s and General Mills have fought decisions to seek higher premiums from some workers, like Wal-Mart’s recent addition of a $2,000-a-year surcharge for some smokers. Many point to the higher healthcare costs related to smoking or obesity. 

Many even describe the charges and discounts as an approach to get workers to take more responsibility for their well-being. Regardless, it means that smokers and others pay more than co-workers who meet a company’s health goals.

But some benefits specialists and wellness experts say plans billed as inducements for wellness, by providing discounted health insurance, can become punitive for people who suffer from health problems that are not entirely under their control. 

Nicotine addiction, for instance, could hinder smokers from quitting, and serious obesity might not be easily overcome.

Present-day rules allow for companies to demand workers who fail to conform to specified standards to pay up to 20 percent of their insurance costs. The federal healthcare mandate raises that amount to 30 percent in 2014 and, possibly, to as much as one-half the cost of a policy.

When Wal-Mart Stores, the nation’s biggest employer, recently sought the higher payments from some smokers, its decision was considered unusual, according to benefits experts. 

The amount, reaching $2,000 more than for nonsmoker, was a good deal higher than surcharges of a few hundred dollars a year imposed by other employers on their smoking workers.

The only way for Wal-Mart employees to avoid the surcharges was to attest that their doctor said it would be medically inadvisable or impossible to stop smoking. Other employers accept enrollment in tobacco cessation programs as an automatic waiver for surcharges.

Some labor experts argue that employers can charge workers higher fees only when they're bound to a broader wellness program, while federal rules don't define wellness programs.

Employers cannot discriminate against smokers by demanding them to pay more for their insurance unless the surcharge is part of a broader endeavor to help them quit. Numerous programs that ask employees to fulfill certain health targets offer rewards in the form of lower premiums.

At the start the system also rewarded employees who fulfilled cholesterol and blood sugar goals, but after workers complained that those hurdles looked punitive.

Workers who don't meet the weight targets can be eligible for lower premiums if a doctor shows they have a medical condition that makes the goal excessive.Some benefits advisers say companies may be increasingly willing to test the boundaries of the law because there has been little enforcement, even though there is a provision calling for employers to admit workers with medical conditions restricting their ability to meet certain standards. 

But some have observed already that they are not being charged premiums when they are vaping. I guess this vaping is a loophole for some insurance companies. Although not entirely true, using those vaping devices (Go to http://www.davincivaporizer.com to see the most advanced vaporizer) could just be a solution not only to your health's advantage but to your work too.

However, the employer is going to win not by cost-shifting but by getting people to stop smoking. Some critics say the surcharge may have the effect of forcing people to opt for less expensive plans or persuade them to drop coverage totally.