NCPA - National Center for Policy Analysis


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 of 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:

  • 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.

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.

Source: Gregory Lopes, "Firms dock pay of obese, smokers," Washington Times, August 13, 2007.


Browse more articles on Health Issues