Health Insurance

[sheaferm]

Missouri

My employer is changing our insurance plan. In this new plan, we are required to sign an agreement stating the following:

We must participate in a regular excersice program. Must submit an exercise program to the Committee that involves exercise three times per week.

May not use illegal drugs, use prescription drugs other than prescribed by Dr.

Must use alcohol in moderation.

Must be a non-smoker.

Have to get an annual physical exam.

If we do not sign this form, our insurance rates will triple. If we sign it and then fail to comply with the requirements, we have to report it to our supervisor. Is this not an invasion of privacy? I personally would not have a problem following the guidelines, but it strikes me as wrong.

 

[Beth3]

It is permissible for an employer to charge selected employees more for "life style" differences (tobacco use being the most common) provided that actuarial figures support the difference. An employer may use plan specific or nation-wide figures to support that (i.e. on average, health care costs for smokers are X% more) but they can't just pluck that figure out of thin air.

Assuming when you say "insurance rates will triple," you mean individual employee premium contributions*, I seriously doubt that that figure can be supported by underwriting statistics.

*If that is not the case, please post back and explain.

To answer your invasion of privacy question, no, this does not constitute that. If you certify that you are non-smoker for example and then take it up, you can be required to disclose that information as requirement to participate in the plan.

What happens if an employee or covered dependent is a smoker? Is coverage then refused to that individual or their family altogether?

Some employers are adopting wellness programs as one means of combating dramatically escallating group health premiums. On the whole, what your employer is doing seems to be in-line with that although I think charging an employee triple in premium contributions or possibly rejecting certain employees for coverage altogether is on the other side of what is legally acceptable.

 

[sheaferm]

Yes, I mean that what we, as employees, will be paying is going to increase. We can either sign the paper and follow the rules and keep our current rates, or if we do not sign it, we pay the increased rate.

Only the policy holder has to agree to the requirements. Spouse/children are excluded.

No one will be refused coverage, they will just have to pay more. I understand that smokers/drinkers/drug users would more than likely have more health problems than your typical healthy person, I have just never heard of this kind of program. It just put me off when I first read it.

 

[Beth3]

I have some experience with charging higher premiums to employees who are tobacco users and find it EXTREMELY unlikely the employer can justify charging smokers a premium three times higher than non-smokers. As I said, the difference in premiums has to be supported by actual underwriting statistics.

If you want to pursue this, contact your State's Insurance Commission or the federal Department of Labor.

 

[sheaferm]

Thank you, I will look into that. At our meeting, our plan administrator said that their rates have increased 40%. I searched the internet and the highest increase I found was 25% (though that of course could be my mistake).

This plan will only go into effect if 75% of our company agrees to it. We are a mechanical contractor, so most of our employees work in the field and almost all smoke/chew tobacco and/or drink on a regular basis. Unless they all just lie about quitting (which would be hard to know because they are not often in the office), I don't think it will go through. However, our VP made it clear that if the company has to eat the extra costs because we do not use the wellness plan, there will be penalties later (at raise time). They act as though it is our choice to sign up, but they are really pressuring us to do so. If we do not, then we are not a "team player".

Last enrollment, we changed providers and the reason they gave was that our rates would not go up according to national averages. That was obviously a lie because the national increase is their reason for wanting this wellness plan.

I am just confused by the whole thing and the more information we get, the more it is sounding like BS.