On-Site Wellness Programs: Will They Be Hurt by Health Care Reform?
Is your company’s wellness program going to be helped or hurt by the new health care act? It depends on your situation but it will most likely get a boost. The health care reform’s effect on employers will vary based on your company’s size, location, existing insurance and wellness plans, and how proactive your company will be to seek out and implement the bill’s benefits of more research, evaluation tools, and technical assistance. Delving deep into the 2,400 document entitled H.R. 3590 the Patient Protection and Affordable Care Act, you can find the following changes which may impact your company’s wellness programs.
How Does Health Care Reform Impact Most Corporate Wellness Programs?
Wellness incentives increase from 20 to 30 percent of the total premium. In 2014, employers can offer bigger incentives for employees’ positive lifestyle practices or participation in health promotion programs, like lunchtime walking or smoking cessation groups. The Kaiser Family Foundation’s 2009 Employer Health Benefits nation-wide survey found that the average 2009 total premium for employer-sponsored health insurance was $13,375 for family coverage. This means that the additional 10 percent incentive increase calculates out to a credit of $1,337 per employee per year. The same survey found the single person coverage average for an employer in 2009 was $4,824, which would translate into a $483 additional tax credit in 2014.
The number of wellness program participants goes up. As outlined in various sections of the health care reform bill, it will result in millions of dollars spent on the development of a national health promotion plan which will include public education about the importance of community and worksite wellness and health promotion programs.
Dr. Michael O’Donnell, Editor-in-Chief of the American Journal of Health Promotion projected that “the provisions in the health care reform legislation will accelerate the evolution of health promotion by a decade. Millions of people will have better access to programs that can help them quit smoking, manage stress, lose weight, and improve fitness. Additionally, these programs will help our nation create environments that make healthy choices easier choices.”
More technical assistance to improve successful workplace wellness programs. Companies of any size will be eligible to access government web portals, call centers and other tools to: 1) find proven ways to increase employee participation; 2) develop standardized measures to assess the beneficial impact of the program on employees’ health and health care expenditures; 3) access evaluation tools to measure such factors as productivity, absenteeism, changes in employees’ health status, and the medical costs incurred by the employee. This information is included in Sec. 399MM.
Proving the ROI for worksite wellness programs will get a lot easier. In recent years, many federal departments have implemented a wide variety of their own in-house wellness programs. The reform bill mandates the Department of Health and Human Services to evaluate these federal workforce programs and report to Congress on the successes and failures of the programs and why. The bill’s section 4402 states that the evaluations will include but not be limited to “absenteeism of employees, the productivity of employees, the rate of workplace injury, and the medical costs incurred by employees, and health conditions, including workplace fitness, healthy food and beverages, and incentives in the Federal Employee Health Benefits Program.”
Regular national surveys on best practices for worksite wellness programs. By 2013, the Department of Health and Human Services will conduct a national worksite health policies and programs survey to assess employer-based health policies and programs. The surveys will then re-occur on a regular, but yet to be determined basis, to measure the efficacy of chronic disease prevention and health promotion programs over time. The report to Congress will include recommendations on how to implement effective employer-based health programs and policies. The surveys are outlined in Sec. 399 MM-1 of the bill.
Vending machines to dispense junk food AND calorie counts. If employees have been resisting efforts to stock healthier items in company vending machines, most vending machine operators will need to place “clear and conspicuous statements” of the calorie count for each food item sold. This change takes effect next year and may make some employees think twice about that yummy looking candy bar. Sec. 4205 holds this information.
How Could the Health care Reform Affect Small Companies’ Wellness Programs?
Small businesses’ tax credits to rise to 35 percent then 50 percent. From now through 2013, eligible small businesses (fewer than 25 employees with average annual wages of $50,000 or less), can receive a tax credit to 35 percent of their contribution if they pay for at least half of their employees’ premiums. In 2014 and 2015, if small businesses buy insurance on the insurance exchanges (which begin in 2014), the tax credit rises to 50 percent. The savings might mean some additional funds available for wellness programs which will reduce premiums over the long term. These changes are detailed in Sec. 1421.
Grant money available for small businesses to implement comprehensive workplace wellness programs. Eligible employers (fewer than 100 employees who work more than 25 hours a week) who do not currently have a wellness program can apply for these grants from a $200 billion, five-year program beginning in 2011. Sec. 1048 details that required program components include the following: 1) screenings and assessments; 2) mechanisms to encourage employee participations; 3) “initiatives to change unhealthy behaviors and lifestyle choices” which would include counseling, seminars, and online programs; 4) improving the workplace environment with polices to encourage healthier lifestyles.
Still confused? You may stay that way for a while because this bill isn’t set in stone just yet. There are amendments that are expected to be passed this week. Private analysts and federal employees are still poring over the details to begin to figure out how the bill will be implemented. If you personally want to read any or all sections of the 2,400 page document, the text of the enacted legislation can be found on the U.S. Library of Congress website. Search for HR 3590.
My Work Oasis
- Ethics in the Workplace
- Changing Role of HR Technology
- The Benefits of a Rewards and Compensation Strategy
- The Growing Interest on Corporate Responsibility
Do you have any salary range topics you would like to see covered here on Compensation Today? Write us a email@example.com.
Are you doing a salary review or compensation benchmarking project? PayScale provides up-to-date, external salary market data you can use right now. And, it is specific to the education, skills set and experience your employees. Give a PayScale demo a try.
- Get a free PayScale compensation report and see salary range for position of your choice.