UnitedHealthcare rolled out a pilot program in Colorado this month that allows consumers to cut as much as $4,000 from their deductibles if they meet four specific health standards, including low blood pressure and non-use of tobacco.
The program is among the first in the nation to provide financial incentives to individual workers for maintaining good health.
Such initiatives are designed to cut insurance company costs but also respond to complaints by healthy customers about high insurance deductibles.
“There has been a keen reaction in the marketplace in that healthier consumers continue to ask the question as to how much they should be subsidizing less-healthy consumers. It’s begun to challenge our traditional understanding on how health care works,” said Jim Hertel, publisher of Colorado Managed Care Newsletter.
In addition to Colorado, UnitedHealthcare’s program, called “Vital Measures,” will be tested in Rhode Island, Pennsylvania and Ohio. Minneapolis-based UnitedHealthcare is Colorado’s largest health insurer, with 900,000 customers.
The program is available only for companies with between 100 and 1,000 employees. The company is expected to roll out the plan nationally in 2008 and potentially expand it to other businesses or individual plans, said Cheryl Randolph, spokeswoman for UnitedHealthcare.
Randolph said about 70 percent of health care costs are related to lifestyle choices.
UnitedHealthcare’s program rewards good health with lower deductibles. It allows an employer to offer workers a high-deductible health plan, with a minimum of a $2,500 deductible for individuals and $5,000 for families, for example.
For each health standard – body mass index, blood pressure, cholesterol and tobacco use – individuals can receive a $500 discount and families $1,000. That means deductibles can drop to as low as $500 for individuals and $1,000 for families.
With family plans, only the policy holder is tested. The spouse must fill out an online assessment exam. Children don’t have to be tested or fill out an assessment.
Randolph said UnitedHealthcare estimates employers could save as much as 20 percent on premiums by using Vital Measures since the company sets premiums based on the employer’s total health care costs.
“We think that these types of incentives are good to help people engage in healthy behavior, and anything we can do to help lower costs is a good thing,” Randolph said.
State Sen. Steve Johnson, who owned a veterinary clinic in Loveland for 16 years, said he thinks small businesses would be happy about a program to slow down the increase in health care costs.
“Anything we can do to keep people more health-conscious about their lifestyle is going to cut down on costs, and anything that encourages that is a good incentive,” said Johnson, who has worked on various health care initiatives over the years.
Tom Clark, executive vice president of the Metro Denver Economic Development Corp., said reducing behavior that leads to poor health is crucial to employer productivity and employee satisfaction.
“Colorado employees get penalized in relation to obesity problems,” he said. “Those costs are typically shared across the national pool, and Colorado has a low incidence of those, so Coloradans are often subsidizing other people’s problems.”
He said two Colorado-based insurance companies are planning to roll out similar wellness plans, some including cash rewards.
Anthem Blue Cross and Blue Shield, which also provides health insurance in Colorado, launched a wellness program in January that offers $50 or $100 for patients willing to complete a health risk assessment. Those diagnosed with chronic diseases are offered further incentives for signing up and completing treatment programs.
“We were sort of the market leader on this,” said Sally Vogler, public relations director for Anthem.
Whereas Anthem’s program benefits people who manage their chronic diseases, UnitedHealthcare’s program rewards good health with lower deductibles.
The state legislature passed a law this year that prevents insurance companies from using previous health records as a determining factor in setting premiums. But UnitedHealthcare’s new program does not change the cost of the premium, it reduces the deductible.
No employers have enrolled in Vital Measures yet because it was recently launched and employers have to purchase the program with a new policy, or wait to renew a current policy.
Staff writer Zach Fox can be reached at 303-954-1755 or zfox@denverpost.com.
