We need a new holiday to commiserate our annual health insurance renewals. We could call it National Premium Supplication Day. Hallmark could issue a special greeting card:
"On Premium Supplication Day,
We Brace Ourselves for More to Pay.
We See the Co-pay Costs Uptick,
and Pray To God We Don't Get Sick."
Every year about this time, people across the nation who are lucky enough to have jobs -- and lucky enough to have healthcare coverage through their jobs – head to HR to find out how much more of their paycheck will go toward premiums, deductibles and co-pays, and what benefits they'll lose.
For many workers, those insurance hikes will eat most -- if not all -- of the relatively small annual raise they may have received. The high deductibles will make access to preventative care unaffordable for many.
Companies aren't to blame. They try their best to make healthcare affordable to their employees – often subsidizing the cost to a great extent. When it comes to controlling healthcare costs, most companies are as powerless as their employees. Healthcare is expensive, and there is nothing to suggest that it will get any cheaper.
Mercer this month released a study which shows that the national average cost of healthcare benefits was about $10,146 per employee, up 6.1% from the previous year. The Mercer estimate is conservative. The Kaiser Family Foundation/Health Research & Educational Trust 2011 Employer Health Benefits Survey reported in September that the average annual premium for family coverage increased by 9% to $15,073 in 2011. Since 2001, KFF/HRET noted, family premiums have increased 113%, compared with 34% for workers' wages and 27% for inflation.
Whatever cost growth estimates you pick, they are unsustainable. At some point, perhaps sooner than later, businesses will determine they can't afford to provide healthcare coverage. Some surveys have suggested that many businesses have already made the decision to drop their coverage in 2014 when provisions in the Affordable Care Act take effect, particularly the individual mandate.
It would be no small irony if our for-profit healthcare system prices itself out of existence and ushers in a government-sponsored single-payer system. We are trending that way as "cost containment" in our healthcare system has come to mean passing more of the financial burden onto the healthcare consumer.
It is under these circumstances that we are seeing a surge in the wellness movement – the idea that employees should take greater responsibility for their health or pay the consequences.
At face value it seems reasonable. Why should the rest of us pay for your lousy lifestyle choices? However, the wellness movement also has huge potential for abuse and discrimination. It also raises troubling questions about who gets thrown overboard, and where we draw the line on employer intrusions into our personal lives.
For example, The New York Times reported this month that – rather than rewarding good behavior – a growing number of employers are telling workers who smoke, are overweight, or have high cholesterol to pay a larger share of their healthcare costs. According to The Times, policies that impose financial penalties on employees' poor health choices have doubled to include 19% of 248 major U.S. employers. Benefit consultants Towers Watson projects a doubling of that number again next year.
The case against smoking is obvious. It's a vile, dangerous, and expensive habit that claims thousands of lives and costs billions of dollars each year for otherwise preventable healthcare. If you light up, you should pay more.
It gets a little stickier, however, with issues like high cholesterol, and overweight. How will companies determine how much more an overweight employee will pay? Will they literally exact a pound of flesh? Will we have a ritualized public weigh-in on Premium Supplication Day?
There are also economic issues at play here. Studies have shown that people who earn less money tend to be more inclined toward overweight, use tobacco, and engage in other unhealthy lifestyle choices. Are we prepared to impose another tax on the people who can least afford it?
Cigarettes cost more than $50 a carton, so smokers can afford to pay more. Again, it gets a little trickier with obesity and high cholesterol. Maybe that well-intentioned smoke-free-but-overweight worker lives in a rougher neighborhood that doesn't provide safe and convenient venues for exercise.
Maybe the closest Whole Foods Market is across town, and the only store nearby is a Kwikki Mart that is known more for its microwave burritos than for fresh produce. Maybe that worker has two jobs and doesn't have the energy at the end of a 16-hour day for a jog around the block on dimly lit streets. Are we are going to punish this person?
There is also the slippery slope argument about wellness that affects everybody because we all have bad habits. Smoking and obesity are low-hanging fruit. The wellness crusaders will return. Will social drinkers be told to stick a cork in it or pay more? What about rock climbers, sky divers, bicyclists, skiers, or others who take part in nominally hazardous hobbies? Will they be told to limit their exercise to a treadmill? And, how and who will we test for compliance?
It probably won't play out like this, but this is not a far-fetched scenario. The wellness movement might slow healthcare cost growth, but it won't stop it.
Along with the annual hikes for premiums, co-pays and deductibles, National Premium Supplication Day may soon provide workers with a list of personal fitness mandates. Much of this seems like rearranging deck chairs on a sinking ship.
As healthcare costs continue to rise, like frightened passengers, we'll become more desperate about containing those costs, and more willing to toss to the sharks those lesser among us who don't pass muster.
John Commins is the news editor for HealthLeaders.