There are plenty of conversations about the rise in health insurance rates. Politicians on both sides debate the merits of the ACA and its role, or lack of a role, in shaping the direction of health care costs. Health care providers, insurance companies and malpractice attorneys are just a few of those taking some or all of the blame for rising rates.
One area that deserves more attention but is over looked is the consumer. A sound risk management practice is to persuade the insured (consumer) to mitigate some of the risk by changing their behavior through positive and negative consequences for losses. An example of this is higher or lower auto insurance premiums based on traffic citations or accident history. Obviously many medical conditions are out of the control of consumers and no one should not be penalized for congenital conditions. But there are numerous lifestyle choices, like quitting smoking or exercising, that do make a difference. Wellness programs are an avenue to provide motivation and encouragement to make better choices.
Regarding wellness and the Affordable Care Act, the ACA has in interesting provision that allows employers to implement a wellness program with group health insurance that costs the employee more if they do not participate. For example, you can require employees to pay up to 30% of their health insurance premiums if they do not participate. Or you may offer smoking cessation programs worth up to 50% of the health insurance premiums. The applicability to this in Oregon is likely to be primarily limited to large employers outside of the health insurance exchange. The Oregon exchange, CoverOregon, rates all small businesses employees in aggregate thus the benefits of one employer enacting a wellness program is extremely limited as it is diffused in the pool. Large employers in Oregon rated with their loss history will have more of an incentive to control costs.
In the 2014 Oregon legislative session, an interesting wellness bill was submitted. HB 4072 would have given a tax break of up to $500 per employee for money spent on a wellness program. Oregon’s even numbered years are shortened legislative sessions and this bill appears to have been stuck at in the Revenue committee in the House. Without commenting on the details of this bill, a tax break that rewards small businesses is an improvement in trying to halt the rise in health insurance costs over the current pooling of risk in the health insurance exchange.
Arin J. Carmack
House Bill 4072: