Monday, October 31, 2011


It seems employers are just getting tired of paying for unhealthy lifestyles.  Many companies are instituting wellness programs where if you sign-on and get your blood pressure checked and do some smoking cessation classes or a walk here and there, you get rewards.  Maybe you get $25 or $50 for participation or an umbrella or a beach blanket.  A pat on the back could be just the right kind of encouragement to get employees engaged in a healthier lifestyle.

There is a second school of thought however, and it is shared by companies such as Walmart, and Veridian Credit Union which are going the route of the "stick" versus the "carrot".  These companies are charging employees higher premiums for unhealthy lifestyles.  For those that can't get their obesity or cholesterol in check or stopping the smoking habit, they will pay.  Employers are getting tired of making the healthier employees pay for the bad habits or lack of attention to health issues of the unhealthy employees.

The Cleveland Clinic has decided to cut smoking at their medical centers, refused to hire smokers, implemented a comprehensive wellness plan, gym and weight loss classes.   In addition they reduced premiums to those employees who maintained or improved their health.

It seems as though trying to be "nice" regarding having employees become serious about their health isn't working for some employers.  Under health reform (PPACA), employers will be allowed to have a premium differential of 30% in 2012 and could go as high as 50% in 2014 for healthy versus unhealthy employees.  This means that for some unhealthy employees,  that choose to remain that way, health care could get a lot more expensive for them.

Tuesday, October 18, 2011


The CLASS ACT was on life support.  Any and all  heroic measures have been exhausted and once taken off support, it was unable sustain life.   Last Friday, October 14, 2011, the Obama administration stopped any further advances on the Community Living Assistance Services and Supports (CLASS) Act. under PPACA (Health Reform Law). The repeal of this provision is pending........but it appears to be dead.

The Class Act was a good idea on paper but with the adverse-selection that the program would attract, it was doomed to be a tax payers nightmare. 

On that note, I wish everyone a Happy Halloween!!

Tuesday, October 11, 2011


You remember the CLASS Act (Community Living Services and Supports Program), it's the part of the Health Reform law that created a long-term care program for everyone.  It also had the brakes put on it by the Obama Administration.  The reason for this is that it is an actuary time-bomb.  It would build up reserves over 5 years (during this time nobody can use it) and then, because it has no pre-existing condition limitations, would go quickly into a death-spiral from all the sick people making claims.  As part Health Reform, the CLASS Act also needed to be self-sustaining. 

Interestingly, the CLASS Act is on the books as reducing the federal deficit.  The administration is using premiums that haven't been paid for a program that hasn't been established count as reducing the deficit. 

Anyway, unless they can make this program self-sustaining, it doesn't seem that it's going to be implemented.  At least not anytime in the near future.