EEOC Wellness Incentive Plans: Has the Grinch Stolen Wellness Plans this Christmas?
Twas the week before Christmas, and all through the country,
Employers wanted to help their employees be healthy,
But unfortunately some lawyers, and the EEOC
Limited plans that ask about disability…
It has been a multi-year struggle for employers wanting certainty about wellness plans. Many wellness plans offer a health risk assessment component, which may include medical inquiries into an employee’s health history. The Americans With Disabilities Act (“ADA”) and the Genetic Information Non-Discrimination Act (“GINA”) prohibit employers from making medical inquiries of their employees except in limited circumstances. One such exception is if the inquiry is voluntary and is part of an employee health program.
The controversy for the last many years centers around whether an employer can provide incentives to employees who complete health risk assessments, or participate in other medical exams or inquiries as part of an employee health program (wellness program), without losing the “voluntary” nature of the inquiry. Two years ago, the EEOC issued final regulations, which allowed employers to offer an incentive of up to 30% of the total cost of self-only insurance coverage. But, this was quickly challenged in the United States District Court for the District of Columbia. The court concluded that the EEOC did not provide sufficient reasoning to justify the incentive limit adopted. The court gave the EEOC until January 1, 2019 to revise the regulations.
Today, the EEOC revised the regulations by removing the section that permitted incentives. In doing so, the EEOC left employers back in the quandary they were in before. Neither the law, nor the remaining regulations, expressly prohibit (or permit) incentives. The remaining regulations provide:
An employee health program that includes disability-related inquiries or medical examinations (including disability-related inquiries or medical examinations that are part of a health risk assessment) is voluntary as long as a covered entity:
(i) Does not require employees to participate;
(ii) Does not deny coverage under any of its group health plans or particular benefits packages within a group health plan for non-participation, or limit the extent of benefits (except as allowed under paragraph (d)(3) of this section) for employees who do not participate;
(iii) Does not take any adverse employment action or retaliate against, interfere with, coerce, intimidate, or threaten employees within the meaning of Section 503 of the ADA, codified at 42 U.S.C. 12203; and
(iv) Provides employees with a notice that:
(A) Is written so that the employee from whom medical information is being obtained is reasonably likely to understand it;
(B) Describes the type of medical information that will be obtained and the specific purposes for which the medical information will be used; and
(C) Describes the restrictions on the disclosure of the employee’s medical information, the employer representatives or other parties with whom the information will be shared, and the methods that the covered entity will use to ensure that medical information is not improperly disclosed (including whether it complies with the measures set forth in the HIPAA regulations codified at 45 CFR parts 160 and 164).
29 CFR 1630.14(c)(2).
Does offering an incentive, any incentive, violate these rules? Only time will tell. The courts had only just begun analyzing this issue when the regulations were issued.