|Title I of the ADA prohibits employers from discriminating against individuals on the basis of disability in regard to compensation and other terms and privileges of employment.|
[InSeyt: Wellness programs are generally considered group health plans. So, it is difficult to understand when a wellness program could be offered outside of a group health plan.]
- The employer may 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 for employees who do not participate;
- The employer may not take any adverse employment action or retaliate against employees for not participating; and
In keeping with government agencies’ penchant for notices, employees must be provided with a notice that:
- is written so that the employee from whom medical information is being obtained is reasonably likely to understand it;
- describes the type of medical information that will be obtained and the specific purposes for which the information will be used; and
- 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 employer will use to ensure that medical information is not improperly disclosed (including whether it complies with the HIPAA regulations).
|Are there Spousal Incentive Limits? Numerous commenters pointed out that calculating the 30% limit on the total cost of self-only coverage does not align with the HIPAA regulations, which provide that the incentive limit applies to the total cost of coverage in which the employee and any dependents are enrolled, when wellness programs are available to an employee’s dependents or spouse. The preamble states that because the ADA’s prohibitions on discrimination apply only to employees, not their spouses and other dependents, the ADA rules do not address the incentives that wellness programs may offer in connection with dependent or spousal participation. Therefore, sponsors are left with the incentive limits for spouses that would apply under HIPAA or GINA.|
The 30% limit is measured against the cost of the applicable group health plan depending on the enrollment of the affected individual and the reach of the wellness program as follows:
- the total cost of the group health plan option in which the employee is enrolled, when participation in the wellness program is limited to employees enrolled in that plan option;
- where the employer offers only one group health plan and participation in the wellness is offered to all employees regardless of whether they are enrolled in the plan, the total cost of that group health plan;
- where the employer offers more than one group health plan option, but participation in the wellness program is offered to employees whether or not they are enrolled in a particular plan, the total cost of the lowest cost self-only coverage under a major medical plan; and
- if the employer does not offer a group health plan, other than the wellness program, the cost of the second lowest cost Silver Plan for a 40-year-old non-smoker on an ACA Marketplace in the location that the employer identifies as its principal place of business.
|What about the 50% standard for smoking cessation programs? A smoking cessation program that merely asks employees to certify whether or not they use tobacco is not an employee health program that includes disability-related inquiries or medical examinations. Therefore, the incentive limits described above do not apply to self-certification and an employer may offer incentives as high as 50% of the cost of self-only coverage pursuant to HIPAA. However, any biometric screening or the medical procedure that tests for the presence of nicotine, cotinine or tobacco is a medical exam under the ADA and the 30% incentive limit would apply.|
Confidentiality. The final rules provide that medical records developed in the course of providing voluntary health services to employees, including wellness programs, must be maintain in a confidential manner. Unless disclosure is necessary to administer the health plan, information collected as part of an employee health program may only be provided to the employer in aggregate form and in a manner that does not disclose the identity of any employee. Of course, a wellness program is generally a covered entity health plan that will also have to comply with similar standards under the HIPAA privacy and security rules. Although only the group health plan (and not the employer) is subject to the HIPAA privacy and security rules, both the employer and the group health plan are responsible for ensuring compliance with the ADA’s confidentiality provisions.
|Why doesn’t the Safe Harbor apply? The ADA contains a “safe harbor” that the ADA “shall not be construed to prohibit or restrict” an employer from establishing or administering “the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks.” The EEOC goes to great lengths in the final rules to justify their position that the ADA benefit plan safe harbor does not apply to wellness programs. Note that court decisions are to the contrary, and place in jeopardy the legality of the final rules. (See our alert on EEOC vs Flambeau here. Notably, the Flambeau case is currently on appeal with the Seventh Circuit.) Note also that these rules have been criticized by employer groups as well as Republican leaders of relevant Senate and House committees. One Senator has vowed to pursue enactment of the Preserving Employee Wellness Programs Act (H.R. 1189, S. 620) to void the EEOC rules (to the extent that courts do not).|
Regulations Under GINA
|Title II of GINA protects job applicants, current and former employees, union members and trainees from employment discrimination on the basis of genetic information. Genetic information is defined to include information about the “manifestation of a disease or disorder in family members of an individual.” Family members include parents, grandparents and children, as well as spouses and adopted children.|
Limited Incentives Offered
- Employers that have not done so already should analyze their wellness programs to determine if they are a group health plan. As noted above, most wellness programs provide some type of medical care and therefore fall within the definition of a group health plan. Wellness programs can be included in an employer’s “wrap plan” in order to comply with many of the ERISA and Affordable Care Act requirements.
- Employers should consider whether to take the position that the EEOC final rules are outside the law and invalid.
Alternatively, employers may decide to accept the final rules and comply. As a result:
- Those with gateway plans should consider changing their plan design,
- Those with incentives should ensure they meet the limitations of the final rules, and
- Employee communications containing the required notice information should be developed. (The EEOC has indicated that it will provide an example of a compliant notice on its website by June 16, 2016.)