Safeway’s Health Plan

This is Steven Burd, writing in the Wall Street Journal:

During a four-year period, we have kept our per capita health-care costs flat….. while most American companies' costs have increased 38% over the same four years. Safeway's plan capitalizes on two key insights:….. The first is that 70% of all health-care costs are the direct result of behavior. The second insight….. is that 74% of all costs are confined to four chronic conditions (cardiovascular disease, cancer, diabetes and obesity). Furthermore, 80% of cardiovascular disease and diabetes is preventable, 60% of cancers are preventable, and more than 90% of obesity is preventable.

Today, we are constrained by current laws from increasing these incentives. We reward plan members $312 per year for not using tobacco, yet the annual cost of insuring a tobacco user is $1,400.

Comments (7)

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  1. Devon Herrick says:

    What Safeway is doing would be illegal under Kennedy’s health bill. See the analysis by Phillip Klein in the American Spectator:

  2. Stephen C. says:

    Also, Devon, it would be even worse if the Kennedy staffers wrote the bill the way they wanted to. Clearly, they want nationwide community rating — the same insurance at the same premium for everyone, regardless of health habits or any other factor.

  3. John R. Graham says:

    Stephen Burd, CEO of Safeway, shows that companies can use incentives to reduce health costs on a voluntary basis. He wants the federal government to reduce its burdensome regulations on self-insured health plans so that Safeway can charge higher premiums to employees who engage in unhealthy behaviors. This is all great.

    How disappointing that he also calls for “coverage for all Americans” that would expand government’s control. Mr. Burd reports that “Safeway’s Healthy Measures program is completely voluntary and currently covers 74 percent of the insured non-union workforce.” The exciting part of Safeway’s health benefit is the voluntary program, with incentives that are successful but would be even more so if government got out of the way. The unexciting part is the “insurance” that is a standard perk, driven by a tax code that classifies it as a non-taxable benefit.

    Instead of calling for the federal government to impose “coverage for all Americans”, Mr. Burd should be advocating reforms that build on his success by increasing Americans’ choice of our own health benefits.

  4. Cameron Payne says:

    Sounds too good to be true. Where can I find a copy of Safeway’s actual health plan, not just the glowing sound bite highlights reported in the press?

  5. David says:

    how does the beath benefit brochure or sign up sheet read…verbiage

  6. david mccallum says:

    Any health care plan is only the method of feeding the MONSTER!! The monster is obesity, cigarettes,alcohol and not enough exercise.

  7. duckinpa says:

    Hey if anybody notices, the cost of safeway employee is more expensive then most company. Yes Safeway is saving money, but nor its employee. Also, Safeway deals with Aenta, and Mrs Bird is on Board there, in PA we had to get rid of blue cross and blue shield, b/c safeway went with aenta, perconal choice was WAY better then Aneta, Also if Steve bird was a good CEO, why is he selling Genuardis? It was the BEst grocery store in 2001 when safeway bought us, now we are laughting stock here, steve burd has just took a great company and employee and trash us. so is safeway healthcare anybetter….i say not