Health Reform Bill Incentivizes Healthy Living with Reduced Employee Insurance Premiums
A frequent topic on the Health Care Lawyer Blog has been combating fraud and waste in the health care industry – both waste due to negligence, and “behavioral waste,” which is the term used to describe monies spent on treating preventable illnesses, such as those associated with obesity, smoking and non-adherence to medical regiments.
Therefore, I was pleased to learn that the new PPACA legislation seeks to combat behavioral waste by allowing employers to give further reductions in health insurance premiums to employees who practice healthy behavior. Prior to PPACA, employers were allowed to give a discount of up to 20 percent of the costs of premiums for employees who reached certain health goals – for example, maintaining a healthy weight, quitting smoking, and keeping blood pressure, blood sugar and/or cholesterol within a healthy range. Under PPACA, that cap is now lifted. Starting in 2014, employers can allow discounts of 30 percent and up to 50 percent in the cost of individual or family health care premiums.
Starting in 2011, small businesses (defined as companies that have 100 or fewer employees working 25 or more hours per week) will be eligible to receive grant funding to help implement such wellness programs. There will also be technical assistance and other resources available to help employers evaluate and launch such wellness programs.
PPACA will also expand wellness discounts in the individual (i.e., non-employer sponsored) market – an initial demonstration project involving 10 to-be-determined states is to be launched in July 2014. Employers who want to learn more about seeing up a wellness incentive program should contact Mercedes Varasteh Dordeski.
(For more additional information about PPACA's wellness and prevention provisions, feel free to check out my article in this month's ABA Health eSource.)
