What's a penalty, and what's an incentive?

A vital issue brought up by the Affordable Care Act is whether employers can penalize employees who decline to take part in wellness offerings. Some consider it a civil rights issue if companies penalize employees who won’t act that way their employer wants them to.

I see that some could see it as an issue, but I hesitate to agree.

First of all, no one has a right to work for a particular company. If a company feels its interest is served by having a healthier workforce, which is a fairly inarguable, then it should be able to hire whomever it wishes. This is quite different from not employing classes of people — by race, ethnicity, disability, etc. — which is clearly proscribed and should be.

Some might argue that, say, obese people, or couch potatoes, are classes of people in the same manner, which is a legal evaluation I’m not equipped to make. Protected classes are determined by courts and legislatures.

In this case, the outcome might hinge on determining whether a condition results from personal choices. Being Jewish, or white, or 6 feet tall, did not result from personal choice, but my choices did contribute to my being 365 pounds, when I was. (I have to add: I said “contribute,” not “determine,” but I’ll leave it there for now.)

Overshadowing this discussion is the difference between incentives — “you can pay less if you do these things” — and penalties — “you have to pay more if you don’t do these things?” Won’t companies set insurance costs so that the “penalties” are baked in, allowing them to grant incentives as they wish?

Before leaving the issue, I should acknowledge: All companies have to compete for talent, so the market will affect where companies set land. And: Even companies particularly committed to having a healthy workforce, not just for economic self-interest but even for altruism, have other priorities, so they won’t be deciding whom to hire based on fitness alone.

[h/t to Brian Eastwood, whose post led to mine.]

Author and wellness innovator Michael Prager helps smart companies
make investments in employee wellbeing that pay off in corporate success.
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