The Power of the Affordable Care Act
The Affordable Care Act – Good News for Corporate Wellness!
The Affordable Care Act is “just what the doctor ordered” for promoting worksite wellness, no irony intended! The spirit of the Federal Guidelines is meant to support and urge employers to install wellness initiatives which actually assist employees to take responsibility for their own health, longevity and the quality of their lives.
Until Jan 1, 2014, companies were limited in the amount of financial incentives they could offer employees to participate in wellness programs.
Now, employers may discount up to 30% of employee benefit contributions and up to 50% for programs designed to prevent or reduce tobacco use. For example, if an employee pays $100 per month for his/her share of health care coverage, and agrees to participate in a smoking cessations program, the employer can reduce the monthly contribution up to $50 a month if the employer chooses. Or if the employee shows a loss of an established goal percentage of body fat from his/her baseline biometric screening, the employer may reward the employee with up to a 30% reduction in contributions.
What’s even more important is that the Affordable Care Act has developed clearer guidelines for what qualifies as a “legitimate” wellness program to earn incentives. Clear guidelines motivate employers to launch “results oriented” wellness initiatives, such as lower cholesterol, body fat, and blood sugar readings and smaller waistlines. These improved numbers, and more exercise logged in during fitness challenges translate into huge health care cost savings as well as longer, healthier lives for our American workforce and their families.
How ACA defines a Wellness Program
For the purpose of simplicity, ACA guidelines divide wellness programs into these basic categories: performance-based and non-performance-based (aka “activity-based”).
These require that certain goals are achieved as defined by the program. Usually, these goals are numeric and documentable. A positive change in biometric scores, smaller waistlines, and proof of smoking cessation are good examples of a performance-based program.
These programs do not require that employees achieve certain goals and proven results. They can be as simple as just participating in biometric screenings, joining exercise programs or attending a smoking education workshop. The easiest and most engaging Activity-Based program is a Health & Wellness Expo. Employees who sign in at the registration booth can be rewarded by being eligible for generous door prizes, given time off to attend or earn incentive points towards an existing wellness challenge. A Wellness Expo “counts” as an incentive-qualified wellness program, and is a logical kick-off to a more comprehensive initiative.
The ACA requires that if an employer incentivizes a program, it must be offered to all employees regardless of medical condition. For example, if a walking challenge is launched, employees in wheelchairs or with other mobility limitations must be offered a way to earn those incentives in another way. If biometric screenings are offered at no expense to an employee, then employees working remotely must be sent home kits to collect data or allowed to visit predetermined clinics to that purpose. Medical waivers for health-contingent programs must be accepted. Tax incentives for companies who install defined wellness programs are in the plan, but have not yet been implemented.
All in all, as of 2014, an estimated 63% of all US companies are in compliance with these regulations and most incentivize their workforce to some extent. It is a wise investment to launch a wellness program, even if it is simply beginning with the least expensive wellness initiative – an Expo – and a plan to grow and expand your wellness, fitness, and safety programs over time.
Authored by: Kathy Bailey, President
People Growers of America
Web resources: Blues Perspective Jones Day Affordable Care Act, Department of Labor, Wellness Programs. Read this article and more it on our Ultimate Wellness Directory