- The Washington Times - Monday, August 13, 2007

Companies seeking to cut rising health care costs are starting to dock the pay of overweight and unhealthy workers.

Clarian Health, an Indiana hospital chain, will require workers who smoke to pay $5 out of each paycheck starting in 2009. For workers deemed obese, as much as $30 will be taken out each paycheck until they meet certain weight, cholesterol and blood pressure standards.

Clarian employees will also be required to take part in a health risk appraisal that will inform the company which employees smoke.

Such appraisals are becoming a popular tool for businesses to determine the health of their work force. The type of health benefit program Clarian is setting up could become a model for businesses in coming years, analysts say.

“We anticipate that more employers will require employees to complete a health risk appraisal and participate in screenings,” said Tracy Watts, a health benefits consultant for Mercer Human Resource Consulting. “We also are seeing more interest in rewards for healthy behaviors such as participating in health management-related programs and for healthy behaviors such as not using tobacco products.”

A survey of nearly 3,000 employers last year by Mercer found that 53 percent required a health risk assessment of its workers. That number is up from 35 percent in 2004.

And 62 percent of the 135 top executives who responded to a PriceWaterhouseCooper’s survey this year said their companies should require employees who show unhealthy behaviors to pay a greater share of their health care costs.

Weyco, a Lansing, Mich., benefits administrator, recently adopted a policy to completely eliminate tobacco use from its work force. In 2003, the company introduced a policy of not hiring tobacco users and began offering smoking-cessation programs to employees, who were given a year to quit.

“While other employers’ health plan costs have spiraled, Weyco’s have stayed the same,” said Gary Climes, vice president and general manager of Weyco.

While charging workers who smoke more for their health care is becoming a widespread practice, more employers are adopting a punitive approach to employees who take health risks such as letting obesity and high cholesterol go unchecked.

Critics view the latest changes as an encroachment on civil rights.

Last month, the federal government implemented new rules to ensure these stringent wellness programs comply with the nondiscrimination provisions of the Health Insurance Portability and Accountability Act.

Health care continues to be the No. 1 cost concern for U.S. companies, said Helen Darling, president of the National Business Coalition on Health, a D.C.-based health care consulting firm for large businesses. That concern rises to new levels each year as the cost of providing health insurance for employees increases at twice the rate of inflation, according to the Kaiser Family Foundation, a nonprofit health policy organization in California.

While many employers have been using financial incentives to encourage participation in wellness programs, Clarian Health decided to use a more strong-handed approach and charge workers more for their health insurance if they opt not to join a wellness program.

Clarian took the dramatic step of docking workers’ paychecks after several years of offering a voluntary wellness initiative. But Clarian’s annual health benefit costs increased 12.9 percent in 2006 and nearly 16 percent this year.

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