Increasing Benefits Costs to At-Risk Employees

A recent trend in benefits is to pass some of the increasing costs of medical insurance to at risk employees. One of the easiest assailed groups are smokers. Not only are they easily identified but they are not faultless in their affliction (like some cases of obesity or cancer with genetic predispositions). The second reason is that smoking is verifiably expensive. A recent study cited the figure of 6–8% of total medical costs in the US is attributable to smoking and nearly one in five deaths can also be traced back to that cause. While 6–8% may sound like chump change, health care costs in the US comprise of 16% of our GDP. Or nearly two trillion dollars.

While workplace bans on smoking while at work isn’t uncommon in the new century, stricter methods have been put into place. In 2005, there was a well publicized case about an employer banning smoking outright as a condition of employment. And it is becoming more of a common practice to charge smokers more for health care coverage than their non-smoking colleagues.

This trend has outraged some rights groups while gaining applause from health groups and insurance companies. On one side, it is unfair to dictate what your employees do outside of work. Not only that, but there are greater risk factors where employers will not penalize an employee. For example, alcoholism may go untreated for years and may do damage far beyond that of moderate to light cigarette usage. On the other hand, employers want to find ways to decrease costs and maintain profitability. Discrimination on the basis of smoking is not against the law so employers are free to do as they please in this arena. And this sort of discrimination isn’t uncommon anymore. As an example, companies routinely give health care discounts to employees who participate in their wellness programs and discriminate against those who don’t participate.

Where do you come down on the issue? There are obviously very polar positions on the issue but there is definitely some middle ground. I’d like to hear your take on it before I post my next post in which I will go into my views in great detail.