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Harvard Business Review on the economics of the Preserving Wellness Programs Act

Do you know whether heartburn pills are safe for long-term use?

Yesterday’s Harvard Business Review blog considered the economics of the now-infamous Preserving Employee Wellness Programs Act (HR 1313).  It had been previously analyzed from the perspectives of privacy and employee recourse. One would think that a measure which failed the latter two tests so miserably would at least show a favorable ROI.

Here is how the economics stack up.  Genetic testing costs about $500 per employee (and dependent — don’t forget that children can be tested too).  In the best-case scenario $1.44 can be saved, in about two years.  That yields an ROI of about 0.0288-to-1. In other words, out of every dollar spent, more than $0.97 is lost. Even by the standards of wellness, these numbers don’t add up.

However, genetic testing makes a ton of economic sense using the strategy made famous by Bravo Wellness, in which a program “provides options for immediate employer cost savings” by being so ridiculously unattractive that employees would rather pay the fine.

Please go to the HBR blog — which is read by exactly the people who would be implementing this program were the bill to pass — and tell them what you think. No need to leave a comment here — everyone who reads this blog has basically the same opinion, differing only in their amount of outrage.


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