Does the ACA Prohibit Charging Different Premiums Based on Vaccination Status?

In a recent announcement, Delta Air Lines revealed that unvaccinated employees would face increased health insurance premiums. This news raised questions about whether such a policy violates the Affordable Care Act (ACA), which generally prohibits discrimination in health insurance based on factors other than age, sex, and smoking.

Understanding the ACA’s Underwriting Restrictions

The ACA aims to ensure that everyone has access to affordable health insurance, regardless of their health status. One of its key provisions is the prohibition on underwriting, which means that insurance companies cannot use factors like medical history or genetic information to determine premiums. Instead, they can only consider age, sex, and smoking status.

Wellness Programs and Incentives

However, the ACA does allow employers to offer wellness programs that encourage healthy behaviors. These programs can include rewards or penalties, such as premium discounts for participating in smoking cessation or weight loss programs.

Delta’s Wellness Program

Delta has characterized its policy as a wellness program rather than a surcharge.

The program offers a premium discount of up to $200 for employees who get vaccinated against COVID-19. This approach falls within the scope of the ACA’s wellness program exception because it is voluntary and the incentives do not exceed 30% of the premium.

Employer Self-Funded Plans

Furthermore, Delta’s health plan is self-funded, meaning that the airline assumes the financial risk of claims instead of purchasing insurance from an external carrier. Self-funded plans are exempt from some ACA requirements, including the ban on pre-existing condition exclusions. This may provide Delta with greater flexibility in designing its wellness program.

Conclusion

Delta’s policy to charge unvaccinated employees higher health insurance premiums is structured as a wellness program that falls within the exceptions allowed by the ACA. However, it’s important to note that such programs must be voluntary and the incentives cannot exceed certain limits.

If you have questions about your health insurance coverage and the ACA, it’s recommended to consult with a licensed insurance agent or contact the ACA Marketplace at HealthCare.gov for assistance.