Bill Would Limit Financial Incentives in Wellness Plans

WellnessCalifornia Health Underwriters is alerting members toSenate Bill 189 (Monning).It would ban all wellness programs until 2020 unless they meet a number of restrictive conditions. A health plan could not offer an incentive or reward under a group health care service plan contract or group health insurance policy unless it met these requirements:

Incentives can only include rewards for participation that are not linked to premiums, deductibles, copayments, or coinsurance.

A program must have a reasonable chance of improving the health of, or preventing disease. It cannot be overly burdensome, cannot be a subterfuge for discriminating based on a health status factor, cannot lead to cost shifting, and cannot use a highly suspect method to promote health or prevent disease.
Participation must be voluntary.
An individual cannot be offered an incentive or reward for participating the program based on satisfying a standard that is related to a health status factor. The following would be acceptable:
  • A program that reimburses all or part of the cost for memberships in a fitness center.
  • A diagnostic testing program that provides a reward for participation, but does not base any part of the reward on outcomes.
  • A program rewards people for attending a health education seminar as long as participation is not related to a particular health condition or any other health status factor.
Participation in the program must be offered to all similarly situated individuals.
People with disabilities must be offered reasonable accommodations to participate.
There must be a reasonably available and equivalent alternative for those who are unable to participate due to occupational requirements, a medical condition, or other hardship.
All materials related to the program must disclose the availability of these accommodations.
The program must assesses the cultural competency needs of the health plan’s population.
The program must provide language assistance for those who speak limited English.
The program cannot not result in any decrease in benefits coverage.
The program cannot not result in an increase in premium for the product as demonstrated through rate review consistent with Article 6.2 (commencing with Section 1385.01).
The incentive or reward cannot not exceed the amounts determined to be unreasonable by regulation by the director in consultation with the Insurance Commissioner
The incentive or reward can not exceed the percentage of the cost of coverage under the plan contract identified in Section 2705(j)(3)(A) of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-4) or regulations adopted thereunder.

The state notes that PPACA prohibits a carrier from requiring a person to pay a greater premium or contribution based on a health status-related factor. Senator Bill Monning said, “There is growing concern among consumer advocates that wellness programs could become a subterfuge for discrimination against those with pre-existing conditions…Wellness incentives should be about making people healthier, not pricing insurance premiums based on pre-existing conditions…” The intent of SB 189 is supported by AARP, American Cancer Society Action Network, American Heart Association, California Black Health Network, California Pan-Ethnic Health Network, Consumers Union, Health Access, Greenlining Institute, and Prevention Institute.

According to a CAHU statement, “As health care coverage specialists, you know the value of wellness programs and positive impact they have on the lives and affordability. CAHU is asking you to join with other licensed insurance agents and their clients in letting your state Senator know you oppose SB 189.” Click here to oppose SB 189.

Last Updated 10/21/2020

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