|EEOC Regulation of Employee Wellness Programs|
Employers are increasingly offering wellness plans designed to improve employee health, enhance productivity and help control health care costs. The ACA allows employers to provide financial incentives to participants in a wellness program of as much as 30 percent of the total cost of coverage when tied to participation in the program. The Equal Employment Opportunity Commission (EEOC) finalized regulations in May 2016 governing employer wellness programs under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA).
The final ADA wellness regulation includes standards on what makes a wellness program “voluntary.” To be considered voluntary, an employer cannot require employee participation in the program. Nor can an employer deny coverage under any of its group health plan (or in particular benefit packages within its group health plan) for non-participation or limit the extent of benefits.
One of the most significant areas of misalignment with the ACA involves the calculation of the allowable financial incentives. Under EEOC’s rules, the total allowable incentive (financial or in-kind) cannot exceed 30 percent of the total cost of self-only coverage. In contrast, the ACA authorizes incentives of up to 30 percent of the cost of coverage in which the employee is enrolled.
Under the final GINA wellness regulations, an employer may offer a limited incentive for an employee’s spouse as part of a voluntary employer-sponsored wellness plan as long as each of the requirements concerning health or genetic services provided on a voluntary basis is met.
Consistent with the ADA final rule, the maximum total inducement for a spouse to provide information about his or her health status equals 30 percent of the total cost of the employee’s self-only coverage.
Senator Alexander, the Senate Health and Labor Committee Chairman and a lead sponsor of S. 620 has expressed concern over the EEOC’s final regulations “Wellness programs are the only part of Obamacare that everyone agreed on—everyone except the EEOC,” said Sen. Lamar Alexander (R-Tenn.). “Congress was clear in its support of workplace wellness programs in the health care law—just about the only provision in the law with bipartisan support—and the Departments of Health and Human Services, Labor, and Treasury were clear in their regulations implementing the law. It seems the EEOC is the only one missing the mark.”
As a result, Senator Lamar Alexander (R-TN) may introduce a resolution of disapproval under the Congressional Review Act to overturn the EEOC rules before the end of the year. In addition, it is likely that legislative proposals to continue to clarify the rules regarding employer-sponsored wellness programs will be reintroduced in the next Congress.
10/23/2016 » 10/25/2016
2016 Strategic HR Forum