Employer Wellness Programs: EEOC Final Rules

Date: 6/3/16
Title: Employer Wellness Programs: EEOC Final Rules

 Employer Wellness Programs: EEOC Final Rules

Overview

On May 16, 2016 EEOC issued Final Rules on Employer Wellness Programs.  The final rules amend Title I of the Americans with Disabilities Act (ADA) and Title II of the Genetic Information Nondiscrimination Act (GINA) and will apply, prospectively, to wellness programs on the first day of the first plan year that begins on or after January 1, 2017.

Employers offer wellness programs with the goal of encouraging healthier lifestyles and to prevent diseases.  Programs may use medical questionnaires, health assessment and/or biometric screenings to determine an employee’s health risk factors.  The final rules allow employers to provide limited financial and other incentives in exchange for an employee answering disability-related questions or taking medical examinations as part of a wellness program. 

Both ADA and GINA generally prohibit employers from obtaining and using information about employees’ own health conditions or about the conditions of family members, including spouses. GINA specifically prohibits employers from requesting, requiring or purchasing genetic information.  Both laws do allow employers to ask health-related questions and conduct medical examinations if the employers are providing health or genetic services as part of a voluntary wellness program.

The final rules clarify that an employer may offer a limited financial and other incentives for an employee's spouse to provide information about the spouse's current or past health status as part of a voluntary wellness program.  Specifically, the ADA final rule limits the maximum incentive to 30% of the total cost of employee-only insurance coverage.  Similarly, the GINA final rule provides that the value of the maximum incentive attributable to a spouse’s participation may not exceed 30% of the total of self-only coverage.  No incentives are allowed in exchange for the current or past health status of employees' children or in exchange for specified genetic information of an employee, an employee’s spouse or employee’s children.

The two final rules clarity that the ADA and GINA provide protections for safeguarding health information as identified in the Affordable Care Act (ACA) and the Health Insurance Portability and Accountability Act (HIPAA).

Under the ADA, all wellness programs that require disability-related inquiries and/or medical examinations must be “voluntary.”  To be considered voluntary, the employer must meet the following criteria:

  • employee participation may not be required,
  • any employee who does not participate in a wellness program may not be denied access to health coverage or prohibited from selecting a particular plan offered by the employer,
  • employer may not take any adverse action or retaliate against, interfere with, coerce, intimidate or threaten any employee who a) chooses not to participate in a wellness program or b) fails to achieve certain health outcomes; and
  • employer must provide notice that clearly explains to the employees what medical information will be obtained in connection with the program, how it will be used, who will receive it and the restrictions on disclosure.

In addition to being voluntary, employee health programs must be "reasonably designed to promoted health or prevent disease." To meet this standard under the ADA, a wellness program cannot require an overly burdensome amount of time for participation, involve unreasonably intrusive procedures, be a subterfuge for violating laws prohibiting employment discrimination or require employees’ significant costs for medical examinations.  Similarly, under GINA, a wellness program will not be considered reasonably designed when it exists to shift costs from an employer to the employees based on their health; is used by an employer to predict future health costs; or imposes unreasonably intrusive procedures, an overly burdensome amount of time for participation or significant costs related to medical exams on employees.

Tobacco/Smoking Cessation Programs

The ADA separates out smoking cessation programs that required employees to be tested for nicotine from other programs that only ask employees if they smoke or if they ceased using tobacco by the end of the program. Smoking cessations programs can only offer a maximum of 30% incentive versus other programs where the employer may offer an incentive of up to 50% of the cost of the self-only coverage.

EEOC Press Release   


 

Disclaimer: The foregoing has been prepared for the general information of clients and friends of Workplace Dynamics LLC and is not being represented as being all-inclusive or complete. It has been abridged from legislation, administrative ruling, agency directives, and other information provided by the EEOC. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel.