2013-03-21 13:12:13 - WASHINGTON, D.C. (March 21, 2013): CVS Caremark is cracking down on workers who balloon the company's medical care and other costs, and possibly undermine its public commitment to health, forcing all employees – on pain of a $50/month penalty – to undergo a medical exam, and imposing penalties on those who smoke or don’t control their blood sugar, blood pressure, cholesterol, BMI, and weight.

But that's really nothing new, and simply follows a growing trend to impose personal responsibility on employees for the consequences of their own unhealthy lifestyles, says John Banzhaf, the public interest law professor who first developed such differential-health-insurance-premium plans, obtained legal approval for them, and most recently helped get a 50% smoker surcharge on medical premiums under Obamacare.

Each smoking worker can cost his company more than $12,000 annually in unnecessary expenses; money which then is not available to provide better and less expensive health benefits to the great majority of employees, says Banzhaf, noting that obese employees also impose huge costs on their companies.

More and more, we are seeing that it's unfair to impose those expenses on everyone,

and that forcing those whose unhealthy behaviors generated these enormous and completely avoidable expenses – imposing "personal responsibility" for them – is the fairest and more effective remedy, he suggests.
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It’s been argued that employers should use a carrot rather than a stick – creating financial incentives rather than imposing penalties – but experience has shown that incentives simply don't work, and that penalties are increasing being preferred in surveys, actual votes, and other measures of public approval.

Paying workers to quit smoking or become non-obese is unfair because only a small number of workers can qualify, and they get extra money for doing what the majority of workers are already doing.

Thus there is resentment; exactly the same type of resentment which occurred when bosses provided breaks for smokers to smoke, but not for other employees to do what they wanted to do.

On the other hand, if companies pay a bonus to all workers who don't smoke and/or are not obese, the amount of such bonuses is necessarily quite small, since there are so many employees who qualify.

As a result, experience – especially with smoking – shows that these small financial incentives are ineffective in inducing workers to make the major changes in lifestyles which are required.

As more and more companies, as well as ordinary citizens, come to see that imposing personal responsibility for the costs of unhealthy lifestyles on those who live them is both fairer and more effective, companies as well as local and state governments are increasingly charging smokers (and, more recently, the obese) more for health insurance or, in some cases, simply refusing to hire them.

We also see the same willingness to adopt punitive measures in the much higher taxes legislators and voters are increasingly imposing on smokers, and in the 50% smoker health insurance premium surcharge under Obamacare, notes Banzhaf, who lobbied successfully for the provision.

JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School,
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Founder, Action on Smoking and Health (ASH)
2000 H Street, NW
Washington, DC 20052, USA
(202) 994-7229 // (703) 527-8418
banzhaf.net/ @profbanzhaf