Friday, September 4, 2009

Healthier lifestyle = lower Lovelace insurance premiums

New Mexico Business Weekly – by Dennis Domrzalski NMBW Staff

Lovelace Health Plan thinks it has a way to keep New Mexicans healthy: Money, as in the form of lower health insurance premiums.

The Albuquerque insurer has rolled out a new premium-based wellness program that will offer members lower premiums if they meet certain healthy lifestyle goals.

Lovelace is partnering with the Ohio-based Bravo Wellness to offer the program, which will set wellness targets for cholesterol levels, blood pressure, body mass index, tobacco use and glucose levels.

People whose ratings fall within so-called healthy ranges for those areas will be given premium reductions.

Lovelace Health System, which owns the health insurance plan, is testing the program on its 3,600 employees in New Mexico. The way it’s designed, employees could be in line for premium reductions of up to $160 a month, said Marlene Baca, vice president and chief sales and service officer for Lovelace Health Plan.

The plan differs from current wellness programs in that it offers a direct financial incentive to people who maintain healthy lifestyles.

“This offers some accountability, and when we think about health care costs and reform, we feel strongly that this needs to be focused on,” Baca said.

The plan’s concept is simple. Lovelace will work with employer groups and Bravo Wellness to set target levels for the areas that have been selected for testing. Blood work will be done and the results will be sent to Bravo. That blood work is generally done at the beginning of an enrollment period. Based on the results, individual premiums can be raised or lowered. The blood work results are confidential and can’t be shared with the employer.

Employees who don’t qualify for those target rates can appeal the decision. Or they can work to get those levels in line with healthy guidelines by working with their physicians and using Lovelace Health Plan’s Healthy Steps program, which provides services ranging from nutritional counseling and smoking cessation to disease management. Employees can be retested every year or as often as their employer allows.

“As health care costs continue to rise, employers can realize tremendous return on investment by providing financial incentives for employees to take control of their own health,” said Lovelace Health Plan CEO Dennis Wilson. “We are committed to this program and believe in its effectiveness, which is why we are offering this benefit to all Lovelace Health System employees.”

The program, which can also penalize people in the form of higher premiums, was made possible by new federal regulations approved at the end of 2007 by the U.S. Department of Labor, said Bravo President Jim Pshock.

“Being able to penalize or reward people based on the results of wellness screening became illegal when Congress passed HIPAA (Health Insurance Portability and Accountability Act), and that was because of uniform coverage rules,” Pshock said.

The new rules take into account the reality of health care in the U.S., Pshock added.

“The Centers for Disease Control estimates that 75 percent of all health care coverage is lifestyle-related. We call this program the Good Driver Discount for Health Care. If you are doing a lot to stay healthy, then you are going to pay less than the person who is not managing those lifestyle risks.”

Bravo Wellness was founded in the fall of 2008 and has 27 employer groups in its programs, Pshock said. “They are spread throughout the nation and we’ve literally got hundreds in the pipeline.”

Pshock said more wellness incentive programs will hit the market in the coming years as employers look for ways to cut their health insurance costs and to keep offering their employees health insurance.

“We have found that with many companies, it is not enough to have wellness tools,” Pshock said. “With meaningful incentives, employees adopt lifestyles and behaviors to sustain good health.”

dfdomrzalski@bizjournals.com | 505.348.8306