- Employers are considering raising health insurance premiums for employees who don't get a coronavirus vaccine.
- Unvaccinated workers may be paying up to $50 more from their paychecks for health insurance, CBS MoneyWatch first reported.
- Companies across industries have been exploring ways to incentivize their workers to get the COVID-19 vaccine.
- See more stories on Insider's business page.
Companies are deciding whether to increase the cost of company health insurance to penalize employees who haven't gotten the COVID-19 vaccine.
Employers are searching for ways to minimize the risk of breakout infections when they reopen their offices as the Delta variant of the coronavirus continues to spread across the US, vaccination rates slow down, and hospitals run out of beds.
Firms ranging from manufacturing, retail, hospitality, financial services, and other sectors are considering raising health insurance premiums on workers who refuse to get the COVID vaccine. CBS MoneyWatch was first to report on this potential trend.
"[Companies are] looking for something that's going to move the needle, and they're looking at a surcharge as a potential option for that," said Wade Symons, a partner at benefits consulting firm Mercer Health.
Unvaccinated workers could expect health premiums to increase anywhere from $20 to $50 per paycheck, enough to make a dent that would make people consider getting vaccinated, Symons said. Though companies are still in preliminary discussions, they hope to roll these policy changes "sooner rather than later" – aiming for the end of 2021 or the beginning of 2022, he added.
Company-wide health insurance plans are based and penalized on workers' health risks, like higher premiums for smokers who are at increased risk for respiratory problems. Similarly, companies can increase plans for unvaccinated employees who are at greater risk of COVID-19 and its long-term health problems, which may end up racking thousands of dollars in hospital bills and costing health insurance companies more to cover.
Though unvaccinated workers may have the option to switch to individual health coverage, many would still have to continue their plans with the COVID-adjusted costs for the remainder of the fiscal year. Even then, group health plans are still typically cheaper than individual health coverage, Symons said.
Companies have been struggling with the idea of mandating COVID vaccines, which may drive away their unvaccinated population and cause further employee shortages.
A surcharge on health insurance "does feel like 'medium step' between the incentive programs that we've seen so far and a full mandate to require your employees to get vaccinated," Symons told Insider.
Walmart and Disney began to require vaccinations for its employees to return to the office. Meanwhile, Target and Starbucks have offered paid time off and transportation to get the vaccine, while Amazon turned to cash and prize lotteries for their employees.