Health Care: Tales of Pipers and Tunes


Business Week writes of the frontiers of employer intervention in employee health–all in the name of cutting the costs of employers helping pay for employees' insurance. One Scotts Miracle-Gro lawn technician, Scott Rodrigues, is fired for smoking on his own time, and he's suing, with his case now before a federal court in Massachusetts. Some excerpts from a very long story:

How do executives looking to cut medical costs persuade employees to take better care of themselves without killing morale and spawning lawsuits? It's a question that's very much on the mind of Scotts CEO Jim Hagedorn, who acknowledges his company's wellness program is controversial. "Jack Welch told me: Man, you have balls of steel,'" says Hagedorn. "This is an area where CEOs are afraid to go. A lot of people are watching to see how badly we get sued."

……. "We have this notion that you can gorge on hot dogs, be in a pie-eating contest, and drink every day, and society will take care of you," says Harvard Business School Professor Michael E. Porter, who co-authored Redefining Health Care. "We can't afford to let individuals drive up costs because they're not willing to address their health problems."

Hence the wellness fixation at companies as varied as IBM, Microsoft, Harrah's Entertainment, and Scotts. Employees who voluntarily sign up for such programs often receive discounts on health-care premiums, free weight-loss and smoking-cessation programs, gratis gym memberships, counseling for emotional problems, and prizes like vacations or points that can be redeemed for gift cards.

Companies save money. Employees get healthier. What's not to like? But the wellness craze raises important issues. One is that people could start blaming unhealthy colleagues for helping push up premiums. Then there are the privacy and discrimination issues: How far should managers intrude into employees' lives? That's the essence of the Rodrigues lawsuit.

This story from the December Governing points to another way out of the dilemmas and control issues that arise from having other people on the hook for your health care–the attitude of control inherent in the above comment from Harvard's Porter, where "we" start to decide how "you" can live because of the health care payment system. How about more actual consumer control, and consumer payment, for simple health care needs, as in the growing trend of medical clinics run by "nurse practitioners"—complete with prices listed on the wall, a real luxury when dealing with health care providers–in some of America's favorite superstores such as Wal-Mart, Target, and CVS?

Of course, the dark cloud of professional guild jealousy and regulatory control is already shadowing this so far quite popular, and quite profitable, system of simple health care delivery:

For state and local officials, the clinics raise the usual concerns about quality of care and possible need for regulation. At this early point in the trend, retailers' reputations are on the line and care is based on carefully standardized procedures. Nurse practitioners follow evidence-based-medicine protocols and guidelines set down by state medical boards. Moreover, the medical problems for which they provide care are limited to minor ailments……"They have high standards now," says Rick Kellerman, a physician in Wichita, Kansas, who is president of the American Academy of Family Physicians. "But as they proliferate, they could overreach on what they treat and who treats it."

Alas, we shall always have with us people like Dr. Kellerman to try to make sure no one "overreaches" on selling Americans services they want at prices they choose when it comes to the holy physicians turf.

NEXT: The Government Makes Stuff Up

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  1. I’m obese. My weight hasn’t cost my employers or the American taxpayer a dime in my entire life. If family history is any guide, I will die of a massive heart attack, in my sleep, at about 60 years of age.
    All you thin, healthy people owe me a buttload of money for the Social Security I won’t be drawing.
    I’d prefer it in small, unmarked bills.
    Thank you.

  2. Johny Clarke, I am sorry but society needs a scapegoat and someone to hate and blame all of their problems on. It is illegal to blame the blacks or the Jews and not many people smoke anymore, so it looks like your it. Sorry.

  3. The double-edged sword of this article, conceptually (in terms of the libertarian response) intrigues me. On the one hand, it’s really a cause for celebration that private employers will fund increased employee health out of a rational decision that it lowers long-term costs and increases productivity. It really takes a lot of the steam out of the argument that a person’s health is somehow a magical entity, that can only be tended to free of the usual cost-benefit analysis. On the other hand, the immediate fear of a backlash that this could lead to health “requirements” – which could lead to interference in a person’s private life or decisions on the same rational is worrisome.

    Of course, whether coworkers blame me for high premiums is irrelevant to me in a properly libertarian society, but its a concern in this one. Obviously, we’ve already seen legislation requiring people to “be healthy for the good of the community” – and anything that increases that mentality by default makes me very nervous.

    Of course, an interesting thought experiment is whether there should be limits on private requirements regarding health. For me at least, the standard comeback to “I shouldn’t have to work in a private office that allows smoking” is that you don’t have to, and I can see a lot of parallels here. Let’s say a company decided to institute salary cuts, or even hiring freezes, for people over a certain BMI or who embrace certain high-risk behaviors. Philosophically, would that be permissible, even admirable as a solution to the “obesity epidemic” sweeping America today?

  4. I wonder if the micromanagement of employee’s lives will change with each study?

    You know, on weeks when a study citing the negative health effects of alcohol use is released, you could be fired for having a beer after work. On those weeks when a study is released that extols the virtues of moderate alcohol use, you could be fired for not drinking a glass of red wine every day.

    I can imagine some of the middle management tools that I’ve worked for in the past loving this sort of stuff. “Dave, I see you’ve gained a few pounds over the holidays. You’re going to need to file a daily calorie report with me from now on.”

  5. David – (great name!)

    If your boss actually spoke to you that way, I’d recommend quitting on the spot. “Dave”?????????????

    In Moedling, Austria, the company Dolphin Technologies offers employees 100 Eu/month if they don’t smoke or quit. (from hier)

  6. We could solve much of this nonsense by simply uncoupling healthcare and employment, which would require tweaking the tax code. It’s a shame that Bush’s proposal to this effect will be ignored or ridiculed by congress, but that seems to be his lot: only his idiotic ideas make it past congress, while the good ones languish.

  7. Ok, I don’t want to sound like a randroid or whatever, but this reminds me of that one part in Atlas Shrugged where the 20th Century Motor Company decides to socialize all incomes and work responsibilities.

    Shortly afterwards they found out that no one could decide what was right or wrong, because it had to be the same for everyone. You couldn’t get a new suit, for example, unless everyone else got one.

    So here it is: we have “employer-funded” (socialized) healthcare and the same problem emerges. Time to get back to individual plans!

  8. In Moedling, Austria, the company Dolphin Technologies offers employees 100 Eu/month if they don’t smoke or quit.

    And if they catch you smoking, they cut your wife’s finger off.

  9. The old Cat’s Eye method?

  10. Johnny Clark, I hate to tell you this but, by law, you have no contractual rights to the money you’ve put into the social security ponzi scheme.
    Good luck with that heart attack.

  11. “Health Care: Tales of Pipers and Tunes”

    Wasn’t that the title of an old Paul Davis album?

  12. I must have at least an ounce of integrity, because as someone who did my time jumping through the hoops in 3 years of law school to get the requisite credentials to practice law, I would have zero problem with paralegals, or anyone else for that matter, opening shop to provide basic legal services (so long, of course, as they did not represent or imply that they had a law degree, instead using whatever other honest means were available to them to convince a prospective customer that they were competent to provide the proposed basic service).

    Entry-level barriers to various occupations are set way too high in our society anyway, seriously limiting a person’s practical freedom to switch careers if and when he finds that his chosen career doesn’t suit him. Law school itself could be much shorter — maybe one year, followed by an old-style apprenticeship during which the “student” could actually make money or at least not dig himself further into debt with tuition payments. Teaching is another profession to which the barriers are artificially set too high, presumably to protect the livelihoods and security of the employed teachers who have already jumped through the hoops (inane educator coursework, etc.).

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