The relationship between an individual’s lifestyle choices and their health outcomes has sparked a proposal to align employee health insurance contributions with these controllable behaviors. Advocates argue that employees should pay a higher or lower share of contributions based on lifestyle choices such as smoking, unhealthy diet, and physical inactivity, as these behaviors are recognized as leading causes of chronic diseases.
This call for change has gained traction, particularly as the US healthcare spending attributable to modifiable risk factors was a significant $730.4 billion in 2016, representing 27% of total healthcare spending. Linking employee contributions to health insurance with lifestyle behaviors is seen as a strategy to address the escalating costs associated with chronic diseases.
Traditionally, employers have shouldered a substantial portion of employee health benefits, but over time, the burden of healthcare costs has shifted towards employees. This shift has resulted in employees bearing a greater share of healthcare costs at the point of service, including deductibles for services and physician office visits.
While some view this cost shift as a method for employers to contain healthcare expenses, others argue that it has reached a saturation point, particularly as medical expenses become less controllable and predictable.
The proposal to tie employee health insurance contributions to lifestyle behaviors is gaining momentum, aiming to empower employees to become more active participants in their healthcare costs. It is suggested that employers differentiate employee contributions based on lifestyle behaviors, as these behaviors are controllable and have a direct impact on overall health insurance costs.
The proposed model for differentiating employee contributions would involve limits to the premium differential and a balance of the upside and downside to the employee. The economic effects would be contingent on the chosen differentiation and the equilibrium between employer and employee benefits.
Alan Pollard, President of Vitality Group, and Tanya Little, Chief Commercial Officer of the company, argue that aligning employee health insurance contributions with lifestyle behaviors creates a more equitable sharing of contributions. They posit that employees become motivated to engage in behaviors that result in reduced healthcare costs, while employers reap economic benefits under various scenarios of employee engagement.
The efforts to align employee health insurance contributions with controllable lifestyle behaviors aim to create a more just and equitable healthcare system. It encourages individuals to take ownership of their health and may lead to improved health outcomes and reduced healthcare costs. As discussions on this proposal continue, it underscores the need for a comprehensive approach to healthcare, addressing both individual lifestyle behaviors and systemic factors.