There has been a great deal in the news lately regarding the Affordable Care Act. In summary, the Patient Protection and Affordable Care Act was written and passed with the intent to ensure every American has access to affordable health insurance. This legislation was signed into law on March 23, 2010. Major highlights of the intent and goals of the “Affordable Care Act” include:
- Preventing health insurers from denying coverage because of pre-existing conditions
- Preventing health insurers from denying coverage of people who become sick
- Preventing health insurers from charging higher premiums because of health issues
- Requiring large employers to provide health insurance or be subject to potential penalties
- Encouraging small employers to provide coverage in exchange for tax credits
- Requiring individuals to obtain health insurance or pay a penalty unless they qualify for certain exemptions
- Allowing parents to extend their health insurance plan to their children up to age 26 years old
If you are currently insured you can stay on your current plan or you can shop for coverage through the insurance exchange in your state. If your income is below $43,320 you may qualify for federal tax credits to help offset the cost of the premium.
The Affordable Care Act also has provisions in it related to prevention initiatives and wellness programs and activities as these not only improve the health of Americans, but also help control health care spending. The Affordable Care Act creates new incentives and builds on existing wellness program policies to promote employer wellness programs and encourage opportunities to support healthier workplaces. These proposed rules would be effective for plan years starting on or after January 1, 2014.
The core points related to Wellness Programs include:
- Wellness Programs are intended to help promote health and prevent disease.
- Many Wellness Programs have some form of reward or incentive associated with participation.
- The intent of the Affordable Care Act is to encourage wellness program development and employee participation as well as preventing any opportunity for discrimination based on health status.
- The Affordable Care Act distinguishes between two types of wellness program designs- Participatory Programs and Health Contingent Wellness Programs.
- Participatory Programs either do not offer any reward or the reward does not require that the employee reach a particular standard related to a health metric such as certain cholesterol level.
- Examples of Participatory Programs include programs that reward employees for attending education seminars; completing a health risk assessment; or completing a health screening activity. This type of program does not require that the employee achieve a specific outcome such as achieving a BMI of 25.
- Health contingent programs require a participant to actually perform an activity or reach a certain health metric outcome to receive the incentive or reward. There are two types of Health Contingent programs. “Activity only” programs reward employees for completion of the activity metric such as walking 5 miles per week but it is not tied to a specific health outcome metric such as weight lost. “Outcome based” programs on the other hand are programs where the employee is rewarded for achieving a specific health goal such as reducing blood pressure or cholesterol or weight or other measurable health metric.
- Programs must be reasonably designed to promote health or prevent disease. To be considered reasonably designed to promote health or prevent disease, a program would have to offer a different, reasonable means of qualifying for the reward to any individual who does not meet the standard based on the measurement, test or screening.
- Programs must have a reasonable chance of improving health or preventing disease and not be overly burdensome for individuals.
- Employees who are eligible must have the opportunity to qualify for the reward at least once per year.
- Programs must be reasonably designed to be available to all similarly situated individuals. Provision of reasonable alternative means of qualifying for the reward would have to be offered to individuals whose medical conditions make it unreasonably difficult, or for whom it is medically inadvisable, to meet the specified health-related standard.
- Individuals must be given notice of the opportunity to qualify for the same reward through other means.
The Affordable Care Act that increase the maximum permissible reward under a health-contingent wellness program from 20 percent to 30 percent of the cost of health coverage, and that further increase the maximum reward to as much as 50 percent for programs designed to prevent or reduce tobacco use.
Evidence shows that workplace health programs have the potential to promote healthy behaviors; improve employees’ health knowledge and skills; help employees get necessary health screenings, immunizations, and follow-up care; and reduce workplace exposure to substances and hazards that can cause diseases and injury.
The final rule language for Incentives for Nondiscriminatory Wellness Programs in Group Health Plans can be found here or an available FAQ.