A few weeks back, the U.S. Equal Employment Opportunity Commission (EEOC) issued final rules regarding how corporate wellness programs can be designed within the framework of existing anti-discrimination laws, namely the Americans with Disabilities Act (ADA) and the Genetic Information Non-discrimination Act (GINA). The rules should serve as a roadmap on how to structure incentives and how to construct wellness programs that are consistent with HIPAA/ACA and comply with the ADA and GINA. Whether they actually do that is a different story. Sure, they answer some questions that employers have had over the last year or so, but let’s see how much more confusion they’ll bring to programs that are already highly regulated.
It seems that questions of legality have persisted with each new set of interpretative guidelines. Before the final rules came out, the EEOC took on Flambeau, which denied healthcare coverage to non-participants in their wellness program. The case ruled in favor of Flambeau, but the EEOC’s new rules define “voluntary” as a program that “does not deny coverage under any of its group health plans…for non-participation.” What does this mean for the ADA’s safe harbor provision? Your guess is as good as mine. We’ll have to wait for the courts to decide.
Moreover, under the new rules, incentive maximums will be capped at 30% of the lowest cost self-only plan offered by an employer (HIPAA says otherwise, but who’s paying attention?). The incentive limit will be separately applied to employees and their spouses; so a couple could collectively be penalized 60% of the cost of self-only coverage. Remarkably, the EEOC has concluded that that’s all well and good! This amounts to thousands of dollars for opting out of the program, yet it’s still considered “voluntary” under the rules.
It’s not all bad news though. The “good” news is that the finalized rules haven’t deviated much from the rules proposed last year, so for most employers, their programs will remain the same. At any rate, I’d encourage employers to review their current wellness programs. It’s important to pinpoint any changes that need to be made to ensure compliance with the new requirements, especially for wellness programs that use medical questionnaires, health risk assessments, or biometric screenings to determine health risk factors such as weight, cholesterol, blood glucose, and blood pressure levels. The final rules go into effect in January 2017, and I’m sure plenty more issues will be raised about what’s allowed and what isn’t before then.