Opinion: Would You Get COVID Inoculation For A Decrease Well being Invoice?

With the highly transmissible Delta variant spreading rapidly in the US and with COVID-19 vaccine uptake still disappointingly low in some areas, it makes sense to pull out all available levers to keep people safe. An underutilized tool is the cost of health insurance.

Health insurance is a significant expense for many Americans and could create strong financial motivation for holdouts to get injected. It’s not just public health when cases increase. Higher vaccination rates can also save money on health insurance by reducing preventable and costly COVID cases. In addition, additional costs not only accrue to the unvaccinated, but also to their employers, colleagues due to possible monthly contribution increases or other taxpayers.

As always with vaccination incentives, the question arises whether to use a carrot with discounts or a whip like a premium increase. In this case, the carrot is a safer option with fewer unintended consequences.

This is how it could work. The Affordable Care Act and Health Insurance Portability and Accountability Act usually prohibit customization of individual insurance costs for anything but a few limited factors such as age, geography, tobacco use, and family size. However, there is an exception for employers who insure almost half of the population. You can modify the premiums to include potentially tax-free incentives worth up to 30% of the cost of insurance as part of workplace wellness programs. You may have come across these through efforts like annual health care questions or step count competitions. The government guidelines published in May suggest that significant incentives for vaccinations are fair game as long as proof of vaccination is voluntary and the employer does not give the injections himself.

According to the Kaiser Family Foundation, the average premium for individual employer-funded insurance in 2020 was $ 7,470. Of course, employers are unwilling to offer newly vaccinated more than a thousand dollars. But even offering a few hundred dollars in insurance savings or a one-time discount would be a good incentive to get a chance, especially when combined with other cash rewards that some states and cities offer. Most employer incentives have been low, though Walmart Inc. has just doubled a cash incentive for employees who get vaccinated to $ 150.

But why not increase the premiums for people who get vaccinated instead? The thought has appeal because many unvaccinated people willingly cause higher costs for themselves and others. However, this path has its problems. Allowing direct price increases would require the unlikely intervention of Congress. And while wellness incentives can take the form of punishment, it could be viewed more as a coercive or punitive measure.

Incentives are most likely to be used by companies that feel they don’t need a vaccination due to opposition from employees or a tight labor market. A heavy fine can alienate employees like a mandate. The midst of a swelling pandemic is also a bad time to do something that might encourage people to stop or avoid reporting. For employers, increasing positive incentives seems to be the better way to go.

Health plans can spend significant sums of money and still stay ahead of the curve. Finally, unnecessary illnesses and hospital stays can be avoided. But the benefits of widespread vaccination go beyond that. It means fewer sick days and quarantine days disrupting businesses. And it could reduce ongoing costs from the long-term effects of COVID and the health problems that can arise when people postpone required care during a surge in cases.

It’s an investment that pays off.

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