Weekend Update

Congress is in session this week, and the Hill’s Floor Watch provides a look ahead. On the agenda is week is a House Federal Workforce subcommittee hearing titled “The Federal Employees Health Benefit Program: Is It a Good Value for Federal Employees?” Hopefully the subcommittee staff recognizes that this is question that answers itself. Of course it does. The Program has kept premium increases below the national average for the past two years, notwithstanding an older population (average age of an FEHBP enrollee is around 60).  The FEHBlog will be in attendance.

The Wall Street Journal’s weekend edition lead with a story headlined provocatively  “When Your Boss Makes You Pay for Being Fat.”

Until recently, Michelin awarded workers automatic $600 credits toward deductibles, along with extra money for completing health-assessment surveys or participating in a nonbinding “action plan” for wellness. It adopted its stricter policy after its health costs spiked in 2012.

Now, the company will reward only those workers who meet healthy standards for blood pressure, glucose, cholesterol, triglycerides and waist size—under 35 inches for women and 40 inches for men. Employees who hit baseline requirements in three or more categories will receive up to $1,000 to reduce their annual deductibles. Those who don’t qualify must sign up for a health-coaching program in order to earn a smaller credit.

The Affordable Care Act promotes this trend by increasing the maximum penalty from 20% to 30% of premiums. According to HHS’s proposed rule, the penalty can reach as high as 50% for tobacco cessation efforts. Federal employees won’t be subject to these penalties, however, unless Congress changes the government contribution formula to incorporate this ACA provision. The article concludes

For now, employers are trying to balance the carrot and the stick. Plenty of companies will be watching to see if inflicting a little financial pain leads to change in the long run. “What are the right pain points?” asks Paul Keckley, executive director of Deloitte LLP’s health-care research arm, the Center for Health Solutions. “Ultimately, you have to make behavior change automatic. We’ve got to make this like brushing your teeth.” 

It will be interesting to learn whether or not this issue crops up at the hearing on Thursday.

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