New Health Insurance Strategy: Incentives for Living a Healthy Lifestyle

As corporate health insurance costs continue to rise across the nation, more employers are rewarding employees for their healthy behaviors and penalizing employees who fail to lead healthy lifestyles. Because healthier employers tend to miss less days of work and draw less on company health insurance plans, employers are turning to wellness programs to help them reduce health care costs and boost employee productivity.

The rising cost of employee health care has caused many companies to reduce employee health benefits and shift a greater percentage of the health care costs to the employees. These changes also come in part because many employees are failing to take responsibility for preventable conditions and seek medical treatment before they become chronic and costly.

While employers are allowed to change benefits and premiums based on whether or not employees have met the requirements of a wellness program, they are prohibited from discriminating against employees who do not meet the requirements of and/or fail to participate in a wellness program. But employers are allowed to offer rewards to employees who engage in health promoting behaviors such as quitting smoking or losing weight.

But even with rewards and incentives for taking the steps to become healthy and more productive, some employers have met resistance from employees who refuse to participate in wellness programs. And while it is a radical change for employers to design their benefits around encouraging their sedentary employees to adopt a more active, diet-conscious lifestyle, the escalating cost of employee health care plans may make wellness programs the norm within a decade.