Michigan senator wants to tie health insurance to behavior

From The Detroit Free Press



October 27, 2005, 5:53 PM



LANSING, Mich. (AP) -- Insurance companies and HMOs in Michigan would be required to offer financial incentives that reward people for healthy behavior under legislation introduced Thursday in the state Senate.



Sen. Tom George, a Portage Republican and practicing physician, said the state is facing a public health crisis steeped in poor dieting, smoking and a lack of exercise. State law currently bars health insurance companies from offering incentives for good behavior -- unlike life, auto and home insurers that can give premium reductions for things such as using an anti-theft device.



"Individuals who exercise, refrain from smoking and are compliant with treatment should see a benefit in their pocketbook," said George, who added that unhealthy behaviors are known to contribute to at least 25 percent of health care costs.



Under George's plan, employers or individuals buying health insurance could receive up to a 10 percent rebate for taking better care of themselves.



George said the legislation is aimed at helping smaller businesses that aren't big enough to self-insure. Self-insured companies have freedom to create incentive programs for their workers, though it's unclear how many are doing so.



A Lansing-area health benefits administrator gained attention earlier this year after making it a firing offense to smoke, though that approach was tied to employment, not health insurance.



Companies wouldn't be required to purchase health insurance coverage that rewards healthy living, George said.



Altarum, an Ann Arbor-based nonprofit research institute, released a 2004 study showing Michigan with high rates of obesity, diabetes, heart disease and smoking compared with other states. Overweight and obese people incur up to $1,500 more in annual medical expenses than healthy individuals, according to the report.



George's legislation has been welcomed in the GOP-controlled Senate. Every Republican senator is co-sponsoring the two-bill package. A spokeswoman for Democratic Gov. Jennifer Granholm said the governor is interested in taking a look at the bills.



Richard Murdock, executive director of the Michigan Association of Health Plans, which represents HMOs, said the group wants to encourage healthy lifestyles.



"This is an area I think we can all come together on," said Murdock, who added that HMOs need to study specifics of the legislation.



A spokeswoman for Blue Cross Blue Shield of Michigan declined to comment until the insurer has time to review the legislation.



George, an anesthesiologist, also is an architect of a new requirement that Medicaid recipients sign an agreement pledging to follow healthy lifestyles. He wanted to charge Medicaid patients less for services if they exercise regularly and don't smoke. But the proposal tying incentives to copays stalled in budget negotiations, and lawmakers are continuing to study the idea.