Company Wellness : Can You Dock Smokers and Overeaters?

Studies show that roughly five percent of workforce drive about 80 percent of your health benefit costs.

No shocker here –  Smokers and obese staff are the highest risk group for developing the sorts of chronic health problems that send costs through the roof.

A small, but quickly growing number of businesss are taking desperate measures to avoid the costs associated with these staff.  The step could be broken down into three levels of aggressiveness and potential risk/reward.

Level one –  the company installs a wellness program in which non-smoking staff members and those who commit to maintaining a healthful weight receive financial incentives that lower their share of monthly insurance premiums.

Level two –  the employer disqualifies job candidates who smoke or are significantly overweight from hiring consideration. Alternatively, some firms require new hires to undergo a health risk appraisal as a condition of being hired.

Level three –  the corporation docks pay or fires workers who fail to control their lifestyle-related health risks. Example –  A corporation called Clarian Health has sent notifications to workers that starting in 2009, workers who smoke or chew tobacco are going to be charged $5 per paycheck.

Are these strategies legal? at level one, the answer is a qualified yes. HIPAAs non-discrimination rules permit such incentives under a few conditions.

Wellness incentives walk a fine line respecting HIPAAs non-discrimination rules. It is legal to reward workforce for wellness participation but its illegal to punish those who fail to improve their health.

Example – If an staff member follows a weight-loss program in good faith but fails to lose weight, you can’t withhold the incentive. In like fashion, if an staff member fails repeated tries to quit smoking, you’re still legally obligated to give them another shot next year.

Also keep in mindthat, by law, the size of the reward or penalty under your wellness program cant exceed 20% of the sum cost of coverage.

The other two are still largely uncharted waters in the courts. Businesss considering these policies should proceed with extreme caution. Remember that the question of “can you do it” (i.e., is it legal?) is different from “should you do it?” (i.e., is it good business?)