Thursday, September 22, 2016

APPAM Announces 2016 Kershaw Award Winner

The Association of Public Policy and Management (APPAM) is pleased to announce that the 2016 David N. Kershaw Award Winner is Dr. Varun Rai of the LBJ School of Public Affairs at the University of Texas at Austin. Dr. Rai will give a featured presentation during the 2016 Fall Research Conference on Friday, November 4.

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Point/Counterpoint: Obesity and the Affordable Care Act

In the design of public policies, a basic issue often arises regarding the role of incentives versus other barriers in shaping behavior. Under the Affordable Care Act, premiums can be adjusted to create incentives for individuals to engage in healthier behaviors including weight loss. Weight, however, may not be responsive to financial incentives for a variety of reasons, many of them biologically based. How the incentives may be designed under the Affordable Care Act, their appropriateness, and the likely impact is the focus of this Point/Counterpoint.

Here, John Cawley, a Professor at Cornell University in the Departments of Policy Analysis and Management and Economics, and Morgan Downey, J. D., Editor and Publisher of the Downey Obesity Report, each provide us with their expert opinions on this emerging area of policy focus. The following framing questions guide the discussion:

  1. The Affordable Care Act gives group health insurers increased flexibility to incentivize healthier behaviors, including weight loss. What form are these incentives likely to take?
  2. In principle, are such incentives an appropriate approach to internalizing the external costs of obesity and reducing obesity?
  3. Does existing evidence suggest that individuals will respond to financial incentives for weight loss?

The Affordable Care Act Permits Greater Financial Rewards for Weight Loss: A Good Idea in Principle, but Many Practical Concerns Remain

By John Cawley

The ACA increased the maximum rewards that group health insurance plans may offer in their wellness programs with the goal of incentivizing healthy behaviors. In principle, incentivizing healthy behavior can reduce external costs and help those with time-inconsistent preferences stick to their resolutions. However, there are problems with the ACA that limits its effectiveness in achieving these goals. Financial rewards for healthy behaviors have a mixed record to date, and thus many practical design features of the ACA need to be resolved in order to improve the effectiveness of such programs.

Participatory wellness programs do not require individuals to meet a health standard to receive a reward; one example is offering reimbursement for fitness center memberships without any requirement that individuals attend the gym or lose weight. In contrast, health-contingent wellness programs require individuals to meet a health standard to receive a reward. An example of a health-contingent wellness program is offering rewards to employees who are healthy weight, while allowing obese individuals to also earn the reward if they lose weight.

Read the full article at WileyOnline

The Doctor Is in Charge: How the ACA Puts the Employee’s Physician in Charge of the Wellness Program

By Morgan Downey

Before enactment of the ACA, the federal Health Insurance Portability Accessibility Act (HIPAA) prohibited group health plans from discrimination against individual participants on the basis of health status. However, an exception was made for health insurance premium discounts or rebates in return for participation in health promotion and disease prevention programs.

Rather than specifying the level of certitude that a program is, in fact, reasonably designed, the three federal agencies writing the regulations (Departments of Health and Human Services, Labor, and Treasury) decided to require that group health plans had to provide a “reasonable alternative” plan to the first “reasonably designed” plan. This leaves open the question, “What is a reasonably designed outcome-based employer wellness program which carries the maximum penalty for failure to achieve the desired outcome?”

Read the full article at WileyOnline

John Cawley's counterpoint.

Morgan Downey's counterpoint.

 

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