Healthcare Payers Face Wellness Conundrum
That's bad news for employers who contribute thousands of dollars annually to employee healthcare benefits.
Note that the government's final rules put some big bucks in play for employees. The maximum permissible reward for some wellness programs will increase from 20% of the average annual cost of premiums to 30%. And the maximum reward for smoking cessation tops out at 50%.
Are the new incentives enough to bring more employers into the wellness fold?
That's the question health plans will ponder as they look at this potential market. And there's no easy answer. Maybe that's why the health insurers I contacted, including Blue plans, Humana, and WellPoint either didn't respond or declined to respond with much more than "it's under review."
The 123-page rule addresses two types of wellness programs, participatory and health-contingent, and prescribes a reward system for each. For participatory programs employers, through their health plans, typically reward employees for belonging to a gym or completing a health risk assessment.
The catch, at least for employers, is that the employee doesn't have to provide proof of that he uses the gym or has made lifestyle changes based on the HRA. Still, employers are usually happy to offer this type of wellness program.
Health-contingent wellness programs defined in the rule are outcome-based, so receiving a reward is contingent on an employee achievement such as losing weight, lowering cholesterol levels, or giving up tobacco products.
But the final rule requires outcome-based wellness programs to also offer a "reasonable alternative standard" to all employees who initially fail to meet their goals to "ensure that the program is reasonably designed to improve health and is not a subterfuge for underwriting or reducing benefits based on health status."
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