Lifestyle-Based Insurance Premiums: Somebody’s Watching You

Here’s something that’s been brewing in the insurance industry for a long time: Health coverage that costs more if your lifestyle suggests that you will be more expensive to insure. As USA Today explains:

Workers who want to lower their annual deductible can volunteer to have blood tests and other evaluations once a year to see if they smoke and if they meet target goals for blood pressure, cholesterol and height/weight ratio.

For each of the four goals they meet, workers would qualify for a $500 credit as individuals or $1,000 as families toward the deductible. If they qualify for all four — and UnitedHealthcare estimates that few will initially meet all four — their annual deductible would fall to $500 for individuals or $1,000 for families.

I predict a libertarian implosion as two competing impulses – the desire to live as you please and a belief in the ability of the free market to solve all ills – collide. Unless you’re a single-payer advocate, however, this development raises questions across the political spectrum. Questions such as:

1. Is it appropriate to penalize people for their health-related behavior? (Or, to reframe the question from the opposite perspective: Why should everybody pay the costs that result from a person’s lifestyle decisions?)
2. Is it fair to charge people more because they can’t achieve the desired results (lower blood pressure, reduced weight, etc.) if they sincerely try?
3. Will this type of program lead to police-state insurance underwriting, as one critic suggests? Will we one day find ourselves pay more in insurance if we accumulate speeding tickets (ahem – guilty), drink a little too much, or work in stressful jobs?

The debate should begin immediately, and in earnest. Mandated coverage programs like that in Massachusetts will only intensify feelings on both sides of this issue. One group will say we shouldn’t be forced to pay for the behavior of others, while another will argue that insurance underwriters shouldn’t become the all-seeing eye that monitors our private lives.