IBM to Pick Up Whole Health Care Tab

October 30, 2009 ( - Computer giant IBM announced Friday that it will pay 100% of the cost of its U.S. employees' primary health care expenses starting in 2010.

An IBM news release said the new program drops coinsurance or deductible payments by employees if they go to an in-networkinternist, family practitioner, pediatrician, general practitioner, or primary osteopath. The policy covers both employees and covered family members.

The announcement said the new benefit will apply to all IBM-self insured medical plan options, which currently cover about 80% of its 115,000 U.S. workers. IBM said it is “among the first” U.S. firms to make such a move.

Other employees participate in HMOs, which typically provide most, but not all, preventive and primary services at low or no cost after payment of premiums, according to the company.

IBM also indicated its U.S. workers would also be eligible for a new wellness incentive which it said was designed to encourage them to “build energy, better health and vitality through all aspects of personal well-being — emotional, mental and physical.” The new incentive becomes one of five such $150 cash programs available to IBM’s full-time U.S. workers. Employees can chose any two rebates to receive up to $300 in cash per year.

“This new approach advances IBM’s advocacy of wellness, preventative and primary care — the cornerstone of keeping people healthy and productive,” said Randy MacDonald, IBM senior vice president, Human Resources, in the announcement. “As a result of our focus on wellness and primary care, IBM employees have become healthier and our costs are rising more slowly.”

Also announced with the coverage changes was a new Personal Vitality Rebate, which will encourage employees to think about good health and well-being in broader holistic terms. The news release said that involves not just checking an employee’s weight or watching cholesterol, but also paying attention to good sleep habits, effective stress management, and proper nutrition.

The rebate will become part of IBM’s wellness rebate program that rewards employees and their children for exercise, healthy eating, and other healthy behaviors. It will use interactive online tools to help employees take steps over 12 weeks to build energy and vitality.

Both the 100% primary care coverage and new wellness rebate will take effect on January 1, 2010, after IBM’s annual benefits enrollment period.

Such efforts have yielded results, the firm said. Between 2004 and 2007, IBM invested $79 million in wellness programs, saving about $191 million in health-related costs.