The Affordable Care Act was introduced to increase coverage for individuals with health insurance and to manage their health coverage. The Care Act allowed many people affordable health care because the program contained many benefits. Among the many initiatives developed under the act was the management of penalties and premiums for individuals involved in their health. This initiative has strategic economic advantages and some disadvantages.
Among the economic advantages, the management of workers’ compensation comes first. Inducing them to be healthy will increase their wages, so as many people as possible will give up their bad habits in this way. In addition, the healthier people there are, the longer they will be able to work. Consequently, the state and the employer get a healthy functioning unit that keeps businesses from sagging or losing revenue (Jones et al., 2019). Workplace wellness programs maintain a healthy atmosphere and promote economic growth. The company will grow professionally, and the revenue will cover spending on benefits.
Economic disadvantages include inadequate employee penalties and discrimination. The employer takes responsibility for the individual’s health decision and increases insurance premiums for the people in case of deviations. The employee is directly discriminated against, which can reduce performance and desire to continue working. The company risks losing talented staff who do not fit the norms of health programs. Inadequate penalties affect the comfort level of staff, which may leave the job to find a company with less stringent requirements. In addition, the dismissal of staff at will may be accompanied by litigation and large compensation payments.
Thus, introducing the Affordable Care Act’s health performance fines and rewards system has economic consequences. First, it can positively impact a company’s overall revenue because healthier employees will work longer hours. Overall revenues would cover the company’s benefit costs, and increase productivity. Second, it could harm the company: staff will begin to leave because of discrimination and work pressure. Moreover, the employer risks losing revenue if the staff decides to pursue a compensation claim through the courts.
Reference
Jones, D., Molitor, D., & Reif, J. (2019). What do workplace wellness programs do? Evidence from the Illinois workplace wellness study. The Quarterly Journal of Economics, 134(4), 1747–1791. Web.