Employers charging unvaccinated workers higher health care costs, consultants find

Businesses mandate vaccines, implement new polices amid delta variant surge, White House says

During a White House COVID-19 briefing, Jeffrey Zients highlighted companies and businesses that are increasing vaccination mandates and implementing new policies and initiatives to help slow the spread of the highly contagious delta variant.

Mercer, a major global consulting firm, said its research shows employers are beginning to tack on surcharges for workers unwilling to get the COVID-19 vaccine.

Mercer said the latest measure is a means to get more employers back into the office even as the delta variant fuels surges in different parts of the world.

The firm said it’s having conversations with upwards of 20 employer clients, but did not specify which companies. Consultants said they’re noticing more employers charging unvaccinated workers and this trend could gain momentum as they try to get business back to normal.

"If an employee is unvaccinated and contracts a COVID-19 infection that requires hospitalization and creates higher claims costs, this could impact the employer’s bottom line, and mean higher future contributions for other employees," the consulting firm said in a statement to FOX Television news on Monday.

Mercer also pointed out the measure can appear attractive to more employers after President Joe Biden said long covid — or COVID-19 patients with long-lasting symptoms — could be considered a disability under the law. That could end up having long-term cost implications for companies and employees, according to the consulting firm.

Although most people with COVID-19 get better within weeks of becoming infected, the Centers for Disease Control and Prevention says some people can experience a wide range of ongoing health problems for four or more weeks.

"Many Americans who seemingly recover from the virus still face lingering challenges, like breathing problems, brain fog, chronic pain and fatigue. These conditions can sometimes rise to the level of a disability," Biden previously said.

However, companies choosing to charge unvaccinated workers could run to obstacles, according to Wade Symons, Mercer’s Regulatory Resources Group Leader.

"If the employer is involved with vaccination, or contracts with a third party to provide the vaccine to employees, the surcharge must not be so substantial as to be "coercive," and consideration must be given to providing accommodation to those who are unable to get vaccinated due to a disability or sincerely-held religious belief," Symons wrote in a blog post.

"Additionally, a vaccine surcharge will need to be compliant with the HIPAA/ACA rules related to wellness programs," he continued.

Symons compared a COVID-19 unvaccinated surcharge to the tobacco-use surcharge that many companies have also enacted.

Meanwhile, several other companies are now requiring employers to receive the COVID-19 vaccine.

Tyson Foods will require all of its U.S. employees to get vaccinated against COVID-19, becoming one of the first major employers of front-line workers to do so amid a resurgence of the virus. Microsoft also announced that it will require proof of vaccination for all employees, vendors and visitors to its U.S. offices starting in September, following similar actions recently taken by Google and Facebook.

Other companies, including Amazon, Walmart and major grocery chains, have so far declined to mandate vaccines for their front-line workers, in part to avoid fueling a labor crunch and persistent worker turnover. The companies are instead continuing with information campaigns, bonuses, time off and other incentives to get vaccinated.

The latest surge in COVID-19 cases has also prompted a surge in vaccination rates. More than 166 million Americans have now been fully vaccinated, representing 50.2% of the country’s total population.

Kelly Hayes and the Associated Press contributed to this report. This story was reported from Los Angeles.

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