Behavioral Discounts

How Your FitBit Might Become A Required Health Monitoring Shackle

While much of the attention on Telematics revolves around vehicle insurance and fleet tracking, UBI for health is not too far around the corner. Currently there are a lot of wearable health monitors that can track heart rate and movement, and other sensors may track blood sugar, pulse oxygen, steps walked, bike miles pedaled, and a host of other factors that could be used to build an actuarial model for health insurance.

Usage Based Insurance Many companies have already put wellness programs into place in order to reduce the overall cost of healthcare insurance, given that the company foots the bill for the lion’s share of the premium. Employees who sign up for various programs may be offered premium discounts or gift cards for giving blood samples, blood pressure readings, or other stats like weight and height in order to create customized programs for improving fitness and health. A lot of junk food options in vending machines have been replaced with healthier alternatives, and program administrators make sure that there are awards given to those who walk a certain number of miles, work out daily, or take actions (like eating a certain amount of fruits and vegetables in a day) designed to promote better health. With the revelation that inactivity and sitting are the biggest causes of health problems since the smoking areas got moved 50 feet from the entrance to the building, companies looking to save on group healthcare premiums have become very proactive about nudging their worker bees into reducing their diabetes risk, if only to reduce exposure to massive class-action lawsuits down the line.

The revolution in wearable fitness monitoring devices and smartphone apps that track steps and check-ins at the health club is a boon for the insurer. Selecting a healthier breed of customer drives down the risk portfolio and improves profitability, especially in an age where the amount of profit on coverage is essentially capped, so therefore you need to make sure that all your coverage categories are on the plus side. (Either that or the insurance company just needs to hire more relatives or pay executives more in order to stay within the margins imposed by naïve lawmakers.)

Your Policy Will Be Assimilated!

How soon until usage-based healthcare insurance is mandated, and everyone is hooked up with Borg-like implants that monitor heart rate, activity, cholesterol, intake of alcohol and tobacco, prescription drug use, hormone levels, and unhappy thoughts? People give up a lot of privacy when they sign on to programs that depend on personal information in order to get health discounts. Those looking to preserve their medical secrecy may find themselves doing so at a price, and may one day find themselves as Amish-style outsiders who don’t have surgically implanted monitors for the healthy-living dictatorship. Because health insurance companies work closely with employers to structure plans and reduce costs, there is an incentive to select out the groups that do not comply with monitoring as well as those who are at the upper end of the cost curve. While it is true that people can benefit a great deal by making healthy choices and exercising more often, at some point when there is an employer-led initiative for people to put in added after-hours fitness work then the question arises as to whether people should be paid for taking the time to wear all the monitoring gadgets that are pushing down increases in the rate structure.