CVS recently adopted a wellness review as prerequisite for employee healthcare coverage. If the employee refuses to reveal weight, height, age and other health indicators to the health insurer, health insurance can still be had – but at a $600 penalty. Employer arm twisting on health insurance has been common for a decade – especially on the subject of smoking. Employers who pay for health insurance have a lawful interest in dissuading employee behaviors that increase health costs. While CVS did not indicate that it would charge more for those with obesity, a smoking habit, or high risk behaviors, they probably will in the future.
The costs that CVS faces for health coverage depend on existing conditions such as; diseases and infirmities already evident; or genetic conditions that may be evident in parents and siblings but which are not yet expressed in the employee; and the employee’s own medical history, including risky behaviors such smoking, inappropriate diet, excess alcohol, or high risk pursuits such as skydiving, motorcycling without a helmet, and recreational drug use. Beyond those factors are the usual, somewhat evenly spread risks of injuries and diseases.
Life insurance underwriters gauge risk from the existing conditions and risky behaviors revealed the applicant’s statements and in a physician’s assessment. The prices charged for life insurance are a direct result of risk that the covered party represents. When people reduce the risk factors, prices decline. People of who buy life insurance understand that. Obamacare’s impact on employers means that many private sector employees will have to find their own healthcare coverage. They will soon learn that some behaviors and conditions make a noticeable difference in premium. Obesity is the new bête noir alongside smoking, and it is likely to command a higher premium for employees in the private coverage market.
For programs such as Medicare, it’s in the public’s interest to charge premiums that cover the additional expected cost for health endangered by smoking, obesity, recreational narcotics use, and helmetless motorcycle riding. Smoking cessation, diet guidance, and chemical dependency treatment will be available as they are under health plans today. To the extent that these risky behaviors are free-will pursuits, the public should not be forced to subsidize them.
Alan Daley is a retired business man who lives in Florida and who writes for The American Consumer Institute Center for Citizen Research