Benefits and Compensation

Wellness Plans Discriminate, Union Official Says

Wellness benefits have exploded in the past decade because they purportedly make employees healthier and save employers money, but they have found a detractor in at least one labor union.  John Borsos, secretary-treasurer of the National Union of Healthcare Workers, told reporters in Washington, D.C., Dec. 17, that wellness programs are a $6 billion industry that puts little value on individual privacy and shifts health care costs to employees with “unhealthy” habits.

The Affordable Care Act has reinvigorated NUHW efforts to shield its 10,000 members from health-based discrimination and invasion of privacy.  It says the ACA increasingly gives employers and their wellness providers, the ability to coax — or coerce — personal health information from employees.

Before the enactment of the ACA, HIPAA set out the rules for employer plan sponsors to give employees monetary incentives to adopt “healthy” habits — to give up smoking, for example — in exchange for lower health care premiums — and it said premiums could be reduced as much as 20 percent as an incentive. The ACA raised the incentive ceiling to 30 percent. Further, the ACA allows employers to offer up to 50 percent in discounts — or penalties, depending on how the program is structured — if smoking  cessation is part of the wellness plan.

Borsos said these penalties and discounts translate to an economic disadvantage for employees who either refuse to participate in the programs, or who refuse to submit to what the union sees as invasive health information disclosure requirements.  “Workers who choose not to participate also may face discrimination by current and future employers for unwillingness to disclose information about their weight, along with exercise, dietary, drinking and drug use habits,” Borsos said.

Borsos said the awards and penalties effectively shift healthcare costs from employers to certain employees in a discriminatory manner because the rules penalize people who are overweight, who smoke or who do not want to share their medical information. Moreover, Borsos said, some of the criteria that wellness programs use to determine whether someone is healthy or not, are arbitrary. As the prime example, he cited the body mass index measurement that many wellness programs incorporate. Borsos said the BMI benchmark is not indicative of a person’s true health. Using BMI alone, he said, the quarterback of the Washington Redskins, Robert Griffin III, would be considered “overweight.”

How the Incentives Work

The trade-off for participating in these plans frequently comes in the form of decreased healthcare premiums. Incentives can also come in the form of non-monetary incentives like giveaways or awards.  But some employers opt to use a proverbial stick rather than a carrot. As an example of the latter, Borso pointed to a widely publicized story about Penn State University that surfaced in mid-2012. The university said that it would impose a $100 pay deduction each month on any employee that chose not to participate in a HRA, causing an outpouring of protests from faculty and staff.  Penn State ultimately scrapped the program because of the strong criticism. Employees called the program coercive, punitive and an invasion of privacy. Others called it a “health tax” or “privacy tax.”

Borsos said the real way to boost employee health is for employers to provide healthy and safe workplaces. When a reporter asked what actions the union is taking in its effort to protect employees from workplace discrimination and privacy invasion through wellness programs, he said that NUHW would push back against the offering of such programs during the bargaining process.

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