Will my health insurance premium go up if I skip the work wellness scan?

The annual email about the company wellness screening has arrived, and with it, a familiar set of questions. Is this mandatory? What happens to my data? And most importantly, will my health insurance premium go up if I skip it? With over 83% of large employers now offering wellness programs, according to the Kaiser Family Foundation's 2023 Employer Health Benefits Survey, these are no longer fringe questions. The financial link between participation and premiums is a significant driver of these programs, but the rules governing it are more complex than a simple yes or no. For benefits leaders and wellness directors, understanding the employee perspective on this issue is crucial to designing programs that achieve their goals.

"Under rules issued under the Health Insurance Portability and Accountability Act (HIPAA) and the Affordable Care Act (ACA), the maximum reward for a health-contingent wellness program is generally limited to 30 percent of the cost of self-only coverage." - U.S. Department of Labor

How program design affects your premium

Whether you will face a wellness screening premium surcharge depends entirely on how your employer's program is structured. Under federal law, wellness programs fall into two main categories: participatory and health-contingent. This distinction is the single most important factor in determining whether your insurance costs can change.

Participatory Wellness Programs: These programs do not require an employee to meet a health-related standard to earn an incentive. A reward is earned simply for participating. Examples include attending a lunch-and-learn seminar on nutrition or completing a health risk assessment (HRA) questionnaire, regardless of the answers. These programs cannot penalize an employee or charge a higher premium for non-participation.

Health-Contingent Wellness Programs: This is where premium adjustments come into play. These programs require employees to meet a specific health standard to earn an incentive. A biometric screening that offers a premium discount for having a BMI below 25 or cholesterol within a certain range is a classic example. Because they tie financial outcomes to health metrics, these programs are more strictly regulated. If an employer uses this model, they are permitted to use a wellness screening premium surcharge for employees who do not meet the standard or refuse to participate in the screening altogether.

Feature	Participatory Program	Health-Contingent Program
Incentive Trigger	Completing an activity (e.g., filling out a form)	Meeting a specific health goal (e.g., blood pressure)
Premium Surcharge Allowed?	No	Yes
ACA 30% Incentive Limit	Does not apply	Applies
Requires Medical Goal?	No	Yes

The friction in participation

While some employees actively choose not to participate for privacy reasons, many who would otherwise engage are stopped by simple friction. Onsite screening events, the traditional method for these programs, create significant logistical hurdles that get in the way of participation.

• Time Constraints: A 2021 SHRM report noted that lack of time is a primary barrier to participation. Taking 30-60 minutes away from work for an appointment, plus travel or waiting time, is not always feasible.
• Logistical Hurdles: For a distributed, remote, or multi-location workforce, a single onsite event is impractical and inequitable.
• Privacy Concerns: While programs are bound by HIPAA, 33% of employees still cite privacy concerns over their employer having access to their health data. An onsite event can feel very public.

This friction directly impacts program success. When participation is low, employers do not get the data needed to manage population health risks, and employees miss out on both the health insights and the financial incentives.

Industry Applications

For benefits brokers and consultants

When advising clients on wellness program design, the conversation must include the impact of surcharges on employee morale and participation. A program with a high financial penalty may seem effective on a spreadsheet, but it can create an adversarial relationship with employees. Highlighting the availability of "reasonable alternative standards" is critical. The ACA requires that any employee who cannot meet a health standard due to a medical condition must be offered another way to earn the incentive, such as completing an educational course.

For wellness directors

The key takeaway is that reducing friction is as important as the incentive itself. If the goal is maximum participation, the method of screening must be as accessible as possible. A program that requires employees to take an hour of unpaid time off to visit a clinic for a screening is functionally penalizing them, even if the incentive structure itself is compliant. This is where technology-driven solutions that allow employees to complete screenings from home on their own time become a powerful tool for driving engagement without coercion.

Current research and evidence

The regulatory framework for the wellness screening premium surcharge is well-established by the ACA and HIPAA. The U.S. Department of Labor, Health and Human Services, and the Treasury jointly issued the final rules. A key provision is that all health-contingent programs must be "reasonably designed" to promote health or prevent disease and should not be a "subterfuge for discriminating" based on a health factor.

Research from institutions like the Kaiser Family Foundation consistently tracks the prevalence of these programs. Their 2023 survey confirms that while most large companies have programs, the type and value of incentives vary widely. The 30% cap (or 50% for tobacco cessation) on incentives/surcharges remains the legal guardrail preventing excessively punitive measures. This ensures that while a financial nudge is allowed, it cannot make insurance unaffordable.

The future of workplace wellness screening

The future of employee wellness screening lies in removing the barriers that fuel non-participation. The one-size-fits-all, conference-room screening event is being replaced by more flexible, equitable, and private models. Technology is at the center of this shift.

Digital platforms that allow employees to perform a comprehensive health assessment using the camera on their existing smartphone represent the next evolution. This approach solves the primary friction points: it takes minutes, can be done from any location at any time, and feels more private than a group setting. By making participation nearly effortless, employers can dramatically increase engagement, gather more complete population health data, and ensure that financial incentives reward action rather than penalize those facing logistical hurdles. This moves the model from a punitive surcharge-based system to a genuinely engaging and supportive one.

Frequently asked questions

---

What is the maximum my health insurance premium can go up if I don't do a wellness screening?

Under the ACA, the maximum penalty or surcharge for a health-contingent wellness program is 30% of the total annual cost of employee-only coverage. This can increase to 50% for programs related to tobacco use.

Is it legal for my company to charge me more for not participating?

Yes, if the program is a "health-contingent" wellness program. These programs tie financial incentives or penalties to meeting certain health outcomes. However, the program must comply with ACA and HIPAA non-discrimination rules. Participatory programs, which just reward the act of completing a task, cannot charge a surcharge.

What if I have a medical condition that prevents me from meeting a health goal?

Employers are required to provide a "reasonable alternative standard" (RAS) for anyone who cannot meet the health goal due to a medical condition. This might involve completing a health education program or working with a doctor to achieve a different goal. You can still earn the full incentive by completing the RAS.

The landscape of corporate wellness is evolving, and the focus is shifting from penalties to engagement. Circadify is at the forefront of this change, providing enterprise health solutions that use digital, phone-based screening to eliminate participation friction and empower employees. To see how you can build a more inclusive and effective wellness program, learn more at circadify.com/industries/health-systems.