EEOC Releases Proposed Regulations on Wellness Incentives

For Immediate Release

 

On Thursday, April 16 the Equal Employment Opportunity Commission (EEOC) released proposed regulations on incentives under employer wellness programs. 

The proposed rule clarifies that an employer may offer limited incentives up to a maximum of 30% of the total cost of employee-only coverage, whether in the form of a reward or penalty, to promote an employee’s participation in a wellness program that includes disability-related inquiries or medical examinations as long as participation is voluntary.  Voluntary means that a covered entity: (1) does not require employees to participate; (2) 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 such coverage (except pursuant to allowed incentives); and (3) does not take any adverse employment action or retaliate against employees.

The proposed rule re-asserts the EEOC’s position, based on the language of the Americans with Disabilities Act (ADA), that employee health programs that include disability-related inquiries or medical examinations (including inquiries or medical examinations that are part of an HRA or medical history) must be voluntary and clarifies the application of that rule in light of the amendments made to HIPAA by the Affordable Care Act.

 The EEOC’s proposed rule differs from HIPAA’s wellness program incentives only in that it extends the 30% limit on incentives under health-contingent wellness programs to participatory wellness programs, and applies the limit based on the total cost of employee-only coverage. 

 The EEOC has also published a Fact Sheet for Small Businesses (http://www.eeoc.gov/laws/regulations/facts_nprm_wellness.cfm) and a Q&A Document for the general public (http://www.eeoc.gov/laws/regulations/qanda_nprm_wellness.cfm). 

 We are reviewing the proposed regulations and will release additional commentary in the coming days.

 

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