Employee Wellness Programs are effective options for companies looking to reduce health care costs by encouraging healthier lifestyles to prevent chronic diseases in employees. To participate in the voluntary program, employees must share their private health information through screenings and questionnaires. Given the voluntary nature of the program, the sharing of private health information is permissible. However, when a voluntary employee wellness program is incentivized, it calls into question if the program is truly voluntary.
A program that requires the sharing of health information is in direct conflict with Title I of the Americans with Disabilities Act (ADA) and Title II of the Genetic Information Nondiscrimination Act (GINA). Having recognized this, the Equal Employment Opportunity Commission (EEOC) issued two new final rules as it relates to the ADA and GINA.
What are the new EEOC Final Wellness Rules?
The rules allow wellness programs to operate the way they were intended in order to maximize their effect on employee health while still protecting those with disabilities. There are two rules that address the conflicts with the ADA and GINA.
Title I of the ADA prohibits employers from discriminating or denying access to employee wellness programs on the basis of a disability. It also generally restricts employers from collecting medical information from an employee with a disability, unless it is done voluntarily through an employee wellness program. Title II of the GINA prohibits this type of information from being taken from a disabled spouse or family member, again, unless it is voluntary.
The new rules require that any employee wellness program is:
- Reasonably designed — For an employee wellness program to be reasonably designed, it must have a reasonable chance of improving the health of, or preventing disease in, employees who participate. It must also not be burdensome to employees. A program is NOT reasonably designed if it exists merely to shift the cost of insurance from the employer to the employee, requires intrusive procedures or requires a significant amount of time.
- Voluntary — To comply with the new EEOC rules, wellness programs must be voluntary and cannot offer extensive incentives in order to coerce unwilling participation. A voluntary program may not: require participation; deny access to health insurance or benefits for those that do not participate; retaliate against employees who do not reach specific health outcomes; and fail to provide full disclosure of what information will be obtained, how it will be used and who will see it. The program also must comply with the incentive limits described below.
- Provides “limited” incentives — To maintain its voluntary status, a wellness program can only offer limited incentives to employees for participating. A wellness program can offer up to 30 percent of the total cost for self-only coverage. In the event an employer does not offer health insurance, it may offer health insurance-related incentives to participating employees, but also may not exceed this threshold.
- Maintains confidentiality — The information collected must be aggregated and in no way used to identify individuals. Additionally, employees cannot be required to allow the information to be sold or transferred to a third party.
Why are the rules necessary?
The rules ensure wellness programs are being used to promote greater employee wellness and prevent chronic diseases, rather than collecting and selling sensitive medical information about employees and their families. It also provides clarity to businesses with employee wellness programs to further protect individuals or family members with disabilities.
What does this mean for businesses?
For some businesses, the new EEOC final wellness rules as they relate to the ADA and GINA mean having to restructure employee wellness programs. For others, it may simply mean educating themselves and administrators of the programs to best protect employees or their family members with disabilities.
Updating your Wellness Program
Be sure to understand what makes a program voluntary and reasonably designed. Meet with your broker to discuss what, if any, changes you will have to make to your programs. Additionally, there are a number of third-party wellness vendors employers can partner with for assistance in administering their programs. These vendors have excellent compliance resources that will work with you and your broker to ensure that your program meets all required regulatory requirements.
Finally, visit these EEOC resources to learn more:
- Press Release on EEOC Final Rules
- EEOC’s Final Rule and Title I of the ADA
- EEOC’s Final Rule on GINA
- Small Business Fact Sheet — ADA
- Small Business Fact Sheet — GINA