Companies won't hire smokers to cut healthcare costs

“You can be terminated for using tobacco if the situation warrants,” spokesman Tom Schwartz said. Reynolds, which told workers of the policy change in July to give tobacco users time to quit, expects the policy will affect fewer than 5 percent of its more than 4,000 employees, of whom about 1,300 are local.

The company has not hired tobacco users for nearly four years, and hasn’t received employee pushback on the new policy, Schwartz said. There is no Ohio law prohibiting an employer from basing employment decisions on whether an employee uses tobacco, according to the Tobacco Public Policy Center at Capital University Law School.

Requiring a tobacco-free work force is just one of several steps employers are taking to hold down spiraling health-care costs.

Among 863 area employers representing 190,660 employees and their family members, the average actual increase in health-insurance costs for 2011 is 8.9 percent, said CEO Scott McGohan of McGohan Brabender, a Kettering-based employee benefits broker and consultant. That’s up from an actual increase of 6.9 percent for 2010 and 7.6 percent in 2009.

In many cases, employers and their workers get fewer benefits for those higher prices. The actual proposed increase for 2011 was 18.5 percent, but negotiations and benefit reductions shrank the overall increase to 8.9 percent.

William Demoray, CEO of Demoray Benefit Administrators, Inc. in Centerville, said clients want new ways to manage the risk of providing health benefits.

More companies, Demoray said, “are putting incentives in place to reward the employee for actively pursuing wellness.”

That’s the approach Henny Penny Corp. of Eaton took. The manufacturer of commercial restaurant equipment offered to leave its 500 employees’ weekly health care contributions unchanged in 2011 — if they accumulated 100 points by completing wellness activities.

About a third of the company’s employees have either qualified for the rate freeze or are within striking distance, said Jeff Frymier, Henny Penny’s human resources director.