Currently some employer deduct more from the paychecks of employees with unhealthy habits for health insurance, increase surcharges for those workers, or offer discounts and rebates to employees with healthy habits.
Since the final HIPAA nondiscrimination rules went into effect on July 1st, some employers may require employees with unhealthy habits to pay more for health insurance as part of the effort to reduce costs.
Under the final HIPAA nondiscrimination rules, discounts and rebates for employees with healthy habits cannot exceed 20% of the cost of health insurance.
Rather than offering incentive such as discounts to healthy employees, some employers are turning to penalties to change employee behavior. Most employers prefer to offer discounts for those employees with healthy habits than to increase payments (penalties) for those with unhealthy habits.
Wellness programs and disease management programs could help change the unhealthy employee’s habits and therefore help reduce costs, better than penalties such as higher premium costs for those with unhealthy habits.
