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Quest to reduce healthcare costs sparks public debate A US lawn and garden company's decision to sack a smoking worker could, his lawyer warns, be a harbinger of more punitive measures. 



 December 30, 2006


US companies have been struggling for years with astronomical healthcare costs but now more and more employers are turning to a combination of carrot and stick to coerce and cajole workers to get healthy - in ways that could leave them vulnerable to lawsuits.

The case of one Massachusetts man who was recently sacked for smoking off the job has ignited debate over the question: exactly how far can employers go to encourage a healthy workforce, and to penalise those who reject the new "culture of health" that is infusing cost-conscious American workplaces?

Exactly how far do employers have the right to pry into the off-duty behaviour of workers, even to achieve the laudable goal of reducing healthcare costs to the company, and to employees, who bear an increasingly heavy share of theburden?

The case of the Massachusetts smoker - who is suing the company that fired him, Scotts, the big American lawn and garden concern - has captured public attention. It has come at a time when American employers are trying many different ways to shift the costs of healthcare to employees whose lifestyles cost the company money.

Scott Rodrigues was sacked after a drug test showed nicotine in his urine, indicating he violated a company policy against hiring smokers - a policy increasingly being adopted by many US employers.

Scotts says its policy is aimed at reducing healthcare costs, given the correlation between smoking and health risks.

"We're not willing to underwrite the costs associated with smoking," says Jim King, a Scotts spokesman, who points out that the company's wellness policy goes well beyond sacking smokers: Scotts will pay for any employee or member of their household to get help trying to quit. And at its rural Ohio headquarters, the company built a Dollars 5m (Pounds 2.6m, Euros 3.8m) wellness centre that includes a free fitness facility, free medical centre and pharmacy that delivers free generic drugs to employees' desks.

Mr King says Scotts is "giving people tools to become better consumers of healthcare", and this includes "taking away all the excuses people have not to live healthier lives". The company even tried taking the candy out of the vending machines, but backed down on that initiative.

Like many US companies - approaching half, according to one recent survey - Scotts also gives financial incentives to employees who take part in a "health coach" programme, which includes filling out an annual health questionnaire. If the em-ployee is flagged as "at risk", he must follow a recommended treatment plan or risk a higher health premium the following year. "There is no guaranteed payback: we are sort of rolling the dice," says Mr King, gambling that investing in wellness will pay off in lower healthcare costs.

But Jeremy Gruber of the National Workrights Institute, a group that documents "lifestyle discrimination", says wellness programmes tied to financial incentives are not really voluntary. "Failing to participate means a financial loss to the em-ployee," he points out, noting that employers have recently begun to move beyond wellness programmes to "punitive measures".

Mr Rodrigues' lawyer, Harvey Schwartz of the Boston law firm Rodgers, Powers & Schwartz, says the sacked smoker's termination could be a harbinger of things to come. "This is a slippery slope: the same logic that justifies not hiring smokers because of increased insurance costs would justify firing overweight employees, employees with high cholesterol, those who skydive or those whose parents die young," said Mr Gruber.

"Smokers are easy targets but they are a much smaller group than people who are obese."

Thirty states have laws barring employers from discriminating against smokers or others who engage in lawful behaviour off the job. But in the other 20, employers are free to do what they like, as long as they do not violate federal laws such as the Americans with Disabilities Act.

So far, the ADA has not protected smokers or overweight workers, except the extremely obese; but employment lawyers say courts have not yet tested the legality of many of the measures taken in the current cost-cutting drive. Companies that remove lifts to install stairs, site carparks far from office buildings or price fruit more cheaply than chips in the company cafeteria are probably safe. However, companies that rewrite job descriptions to include more physical activity (as one Wal-Mart manager suggested in a memo leaked in 2005) may risk violating the ADA if the new description screens out disabled people, legal experts say.

In the end, says Mr Gruber, "there's very little that you do in your private life that doesn't affect your health."

Employers that delve more and more deeply into worker health may end up violating privacy laws, he says, not to mention losing out in the court of public opinion.