Even before health care reform legislation has been formally introduced on
Capitol Hill, skirmishes have broken out regarding proposals to establish a
government-sponsored insurance program, tax health benefits and mandate employer
coverage.
But an area that has drawn high-profile activity by HR professionals—wellness
and prevention—may survive the coming battle because it consistently draws
bipartisan support.
A bill written by Sen. Tom Harkin, D-Iowa, would provide an annual $200 tax
credit for each of the first 200 employees participating in wellness initiatives
and $100 for each additional employee.
The Healthy Workforce Act requires that the wellness programs include three
of the following four components: health education, participation monitoring,
behavioral change and a supportive environment for healthy lifestyles.
Harkin is confident that the measure will be included in comprehensive reform
bills that come out of the Senate Health, Education, Labor and Pensions
Committee and the Senate Finance Committee.
The finance panel, led by Chairman Max Baucus, D-Montana, and ranking
Republican Charles Grassley, R-Iowa, has jurisdiction over tax policy.
“Both Grassley and Baucus have been very supportive of it,” Harkin said
before the Memorial Day congressional recess.
On Tuesday, June 9, in Washington, America’s Agenda, a coalition of
businesses and unions, released what it calls “a consensus-based framework for
sensible and achievable national health reform legislation” that emphasized,
among other things, improved disease prevention and management.
John Butler, chief human resources officer at Textron, helped the group make
the case for prevention. The Providence, Rhode Island, manufacturer has held its
health care costs below the national average and has not increased employee
contributions for its health care plan in the past five years.
The company consolidated 154 medical plans into one consumer-driven offering
for salaried employees, instituted wellness programs, encouraged the use of
generic drugs and generally squeezed inefficiencies out of its system, according
to Butler.
As a result, the company has saved about $47 million annually since 2002.
“It’s not about cost shifting,” Butler said at a National Press Club event.
“It’s about prevention.”
At the same press conference, Randy MacDonald, senior vice president of human
resources at IBM, touted the value of prevention. Between 2005 and 2007, IBM
invested $81 million in wellness programs and saved about $190 million.
“We genuinely believe that IBMers have become healthier,” MacDonald said via
speaker phone from IBM headquarters in Armonk, New York. “Our employees also
have become more productive and satisfied.”
Dow is another prominent wellness advocate. Janet Boyd, director of
government relations tax and benefits, participated in the April press
conference where Harkin introduced his bill.
Later that month, Gary Billotti, Dow’s global leader, health and human
performance, spoke at the World Health Care Congress in Washington.
“We’re building a strong new culture of health, with prevention at the core,”
Billotti said. “It’s become a part of our annual company sustainability
goals.”
Billotti said that for every 1 percent improvement in health risk factors for
Dow employees over 10 years, the chemical company saves $62 million in health
care costs.
Dow spent $700 million on wellness programs in 2008 and had a 78 percent
employee participation rate in health services activities, a 4 percent increase
over 2007. More than 18,000 employees joined at least one of more than 1,800
group activities, a 14 percent increase over 2007.
Other companies that have brought a wellness message to Washington in the
last two months include General Electric, General Mills and Campbell Soup Co.
As Congress begins the arduous process of cobbling together legislation, it
should focus on areas where business, labor and many other groups aligned, said
an America’s Agenda board member.
“This is the very best time to be bringing this consensus forward,” said
Richard Gephardt, a former House Democratic leader. “We need to start where we
agree.”
Inevitably, the process also will involve warfare—like the fight breaking out
over whether to tax employee health benefits to help pay for reform.
“If we begin to tax employee benefits … there will be a mutiny at the gates,”
MacDonald said. “It would be counterproductive and counterintuitive as
well.”
A labor official chimed in on the same point.
“It will be a revolution at the gate, if they talk about taxing existing
benefits,” said Terry O’Sullivan, general president of the Laborers
International Union of North America.
—Mark Schoeff Jr.
Workforce
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