Your health plan: The next frontier (pg. 3)

  @Money July 26, 2013: 4:22 PM ET

Now you really have to go to the gym

Four years ago Chester Clever, now 38, took his company up on the offer of a checkup at work. The incentive: zero co-pays for doctor visits on his health plan from Sierra Nevada Brewing in Chico, Calif. After learning he had high cholesterol, he began biking to work and eating healthier. "I feel a whole lot better than I did," he says.

Those kinds of nudges from the boss to get in shape and see a doctor less are increasingly common: About two-thirds of employers offer financial rewards for healthy habits, says Towers Watson.

Now the goal is to get results. By 2014 nearly half of large firms will tie the payout to a good outcome, such as better cholesterol or a lower body mass index (BMI), not just the effort, up from 16% who do so now.

Next year Sierra Nevada plans to hand out prepaid cards worth $40 or so every quarter -- programmed to pay for only healthy food -- if your BMI falls between 18.5 and 27; workers outside those bounds who do improve will earn a partial reward.

Related: Don't understand Obamacare? Watch YouToons

More significantly, rewards are morphing into penalties. Instead of earning a $500 premium discount for joining a weight-loss program, you might have to pay $500 more if you're overweight and doing nothing to shed the pounds. In 2014 that penalty can be as high as 30% of plan costs, up from 20% now.

One of the goals of health reform was to ensure that no one could be charged more for insurance just for being sick. So this development isn't sitting well with patient advocates.

"We are concerned this is a way to backdoor medical underwriting and potentially leads to discrimination against people with illnesses," says Dede de Percin, executive director of Colorado Consumer Health Initiative.

What you should do

Know your rights. If missing a BMI or blood pressure threshold has you paying more for insurance, under new federal rules released in May, your company must offer you another way to earn the reward, says Amy Moore, an employee-benefits attorney in Washington, D.C.

If that alternative is based on another outcome, your doctor can work with your employer to find a solution.

Go beyond the rewards. Many employers say wellness initiatives save money and boost productivity. But so far research has found that while the programs help with smoking, there's been less success with weight loss and exercise, says Janet Coffman, an associate professor at the University of California at San Francisco.

So you need to take the lead. The single best way to stick with a healthy diet, studies find, is to write down what you eat every day. To keep yourself going to the gym, get a work-out buddy. You and your company will profit. To top of page

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