EEOC Ruling on Wellness Programs

Jul 29

Wellness program laws are tightening in order to protect employees and employers alike.

The Equal Employment Opportunity Commission (EEOC) voted 2-1 in June 2020 to approve the proposed rulemaking on wellness programs.

The new ruling was prompted after the 2016 challenge by AARP that, under the current rules, some wellness programs violated ADA and GINA by allowing employers to penalize employees who refused to disclose private medical information and were discriminative towards people living with disabilities, those in poorer health, required or coerced the disclosure of medical information, and could even unduly impact an employee’s personal time outside of work.

There are two main areas covered in the new ruling. The first is that employers can tie up to a maximum of 30% of the total cost of a health plan premium to wellness incentives if the employee is on the employer’s health plan. The EEOC agrees that large incentives (above 30%) violate the voluntary requirement within the ADA.

The amount or type of incentive should not be punitive and negatively impact the employee if an employee chooses not to participate in the wellness program, especially if it is a health-contingent program. If tied to a health insurance plan, there is the possibility that the health premiums of employees in these types of programs may increase (up to 30%) if the employee fails to meet certain health goals such as attaining lower blood glucose levels. It can therefore penalize low-wage workers, workers of color, and older workers. This area may be tightened up later this year or in 2021 to ensure that health-contingent programs comply with HIPAA and the ADA’s requirements that employee participation in a wellness program should be voluntary if it includes medical questions and/or examinations.

For employees who are not on the employer’s health plan, the incentives are limited to no more than “de minimis incentives.” Also, if the wellness program includes anything that requires the employee to complete inquiries, questionnaires, examinations, and/or examinations or medical information, it would be viewed as coercive and not voluntary.

The laws are tightening in order to protect employees and employers alike, and while financial and other inducements can play a supporting role within wellness programs, employers cannot require that an employee participates in the program, or deny coverage under its group health plans, or discipline an employee who refuses to participate in a wellness program or fails to achieve certain outcomes.

Margaret Stockley is the CEO of the online wellness training company POWCERT and can be reached at info@powcert.com

She is also the author of multiple books including Transforming Workplace Wellness and Stress Management At Work. No More Stinkin' Thinkin' launches on September 25th 2020.