The Affordable Care Act, first disparagingly referred to as Obamacare and now adopted as its accepted moniker, is the most sweeping and dramatic health care legislation since Medicare. It’s also one of the more divisive.
Proponents say it will bring health care costs down through wider preventative care; opponents say it is intrusive and sets us up for a new bloated federal bureaucracy.
One of the most important tasks in preventative care and health care cost-reduction is addressing the obesity epidemic. According to the Centers for Disease Control and Prevention, the direct and indirect medical care costs of obesity in the U.S. in 2020 was $147 billion. While obesity rates have leveled in recent years, long-term projections are still grim, with the possibility of nearly half of all Americans being obese by 2030. One report projects the majority of states will be over the 50 percent level.
While there are many myths about Obamacare, one of the better known facts about the legislation is that it will eliminate insurance companies’ ability to discriminate based on pre-existing conditions. But it’s not the utopian “health care for all” scenario some critics may think. Companies are able to more aggressively reward employees for achieving preset wellness goals, and conversely, saddling those who don’t make an effort to improve their health with higher premiums.
Do Americans Have to “Get With The Program”?
One of the cornerstones of preventative care under Obamacare will be a bigger promotion of company wellness programs. Some research backs the potential cost savings. According to a study on workplace wellness programs conducted at Harvard, there was a reduction of $2.73 in costs associated with absent workers.
In 2020, The Affordable Care Act gives employers more power to reward employees who meet certain health goals through wellness programs. The reciprocal effect is that those employees who don’t take part or meet these goals will be paying more for their employer health coverage.
Typically, these wellness programs include health screenings for high blood pressure and high cholesterol levels. There are also efforts to encourage employees to quit smoking, manage their weight, and exercise through education and fitness programs.
The Affordable Care Act places wellness programs into two categories: participatory wellness programs and health-contingent wellness programs. The first type does not require the participant to meet certain health standards to receive a reward. This may include fitness center reimbursements. Participatory wellness programs are less complicated from a legal perspective because they don’t have to meet as many of the HIPAA nondiscrimination requirements.
However, health-contingent wellness programs require participants to meet certain health criteria to receive rewards, which come in various forms, such as premium discounts, rebates, or other benefits. Participants who can’t meet requirements the first time must be given an opportunity to qualify for the reward in some other way.
A proposed rule change from last November ups the ante by increasing the maximum employee reward from 20 percent to 30 percent of the total cost. But critics of the incentivized-style wellness program take issue with a few of its premises. Some say there is little evidence that participants who reach goals spend significantly less in health expenses.
Deciding Factors – Which is Right?
Part of the problem may lie in using body mass index (BMI) as a criteria for optimal health, a measurement that has been put into question for its many flaws. This may explain the results of a survey conducted by UCLA law professor Jill Horwitz, which found people with high BMIs don’t necessarily cost their employers more than thinner workers.
Other valid concerns:
- Using cholesterol as a wellness measurement, when it’s estimated that approximately 600,000 Americans have high cholesterol due to their genetic makeup.
- A progressively overbearing employer deciding who and what is healthy.
- Lower income people already face an uphill battle with stress, affording healthy food, and making time for fitness. If they don’t meet standards, is it fair to “pile on” with more financial stress and overburdening them with a greater portion of health care costs?
One challenge in fully realizing the potential for corporate wellness programs is more people are opting out than taking advantage of them. Maybe the more aggressive incentives will make more people take action.
The government will finalize rules for workplace wellness plans later this year.