Arizona was getting a lot of media attention yesterday because of a proposal to add a fee to Medicaid recipients who smoke or have other unhealthy behaviors, including diabetes patients who don’t follow their doctor’s weight-loss advice.

According to a story in the New York Times:

“This is an annual fee that says to consumers, ‘Hey, we’re not going to prevent you from smoking, but you have to put a little bit more into the system because it costs us more,’ ” Ms. Coury said, citing a 2006 survey that showed that 46 percent of the patients in the state’s Medicaid program were smokers.

As for being overweight, Ms. Coury said the cash-strapped agency would not be weighing people and slapping a fine on those carrying extra pounds. Rather, the $50 would be charged to those who were specifically urged by doctors to lose weight for health reasons, like diabetes, but failed to do so, she said.

A similar proposal was considered two years ago by the Hawaii Employer-Union Health Benefits Trust Fund with the backing of a key labor representative.

John Radcliffe, a former official of the University of Hawaii faculty union and a member of the EUTF board representing labor, pressed for adoption of a mandatory wellness program as a way to confront staggering cost increases in health care costs.

According to Richard Borreca, writing in the former Honolulu Star-Bulletin:

Cajoling workers to stay or become healthy has not worked. Radcliffe points to a program for the 110 people with diabetes in the state Commerce and Consumers Affairs Department.

“Bottom line is after a massive effort, over more than a year’s time, there were three people in the program,” says Radcliffe, noting that chronic diseases such as diabetes are the biggest part of increased health care costs.

So, he reasons, if you can make it financially unpleasant (charge them more) for people who smoke, don’t lose weight, don’t exercise, or drink too much, you will save tons of money. “Persistent failure to take better care of one’s own health would mean that employees would be responsible for much of the cost of their own premiums,” Radcliffe told his fellow trustees.

The proposal was eventually shelved after a legal opinion by the Attorney General’s office concluded

According to minutes of the August 26, 2009 meeting of the EUTF Board of Trustees:

Trustee Radcliffe stated that he wanted the EUTF to mandate a wellness program so people could better control their own blood pressure, diabetes and so forth. About half the costs of health care in the United States and Hawaii are due to poor diet and lack of exercise. We have studied this extensively and found that voluntary programs are very ineffective. The people that need them the most do not want to volunteer.

The EUTF was going to look into the issue of mandating. It would lower the cost very considerably but the deputy attorney general says that “Given the expansive definition of ‘disability’ under the ADAAA, a person diagnosed with diabetes, high blood pressure, obesity, etc., could claim discrimination under the ADAAA, and attempts to impose a mandatory wellness program with consequences for failure to complete examinations or assessments or for satisfactory engagement in a health enhancement plan, would most certainly face legal challenge.” Trustee Radcliffe stated that the Board should cancel the RFP for the EUTF Wellness Program.

If Arizona is successful in implementing its health fee proposal, perhaps the EUTF can reconsider its mandatory wellness proposal as well.