#childsafety | EEOC Wellness Rules Proposed, Water Bottle Enthusiasts Rejoice – Employment and HR


Synopsis: For years, employers have struggled to understand
what level of incentives in wellness programs might be considered
“voluntary” under the Americans with Disabilities Act
(ADA). After earlier guidelines were challenged and ultimately
thrown out by a federal court, the EEOC has finally issued its
long-awaited, revised guidelines under the ADA and the Genetic
Information Nondiscrimination Act (GINA). As described in this
alert, the newly proposed rules would generally limit incentives to
“de minimis” levels for so-called
“participation-only” wellness programs, while deferring
to HIPAA’s guidelines for “health-contingent”
wellness programs.

Brief Background on Federal Laws Governing
WellnessPrograms

Employers generally offer wellness programs to promote health
and disease prevention within their workforce. Despite these noble
intentions, a variety of federal laws govern such programs with the
intent of balancing workforce health against the risks of
employment discrimination on the basis of adverse health conditions
or genetic information. While not an exclusive list, employer
wellness programs are generally governed by some or all of the
following federal laws (depending on the design of the
program):

Health Insurance Portability and Accountability Act
(HIPAA)

HIPAA generally breaks wellness plans/programs into two
categories:

  1. Participation-Only Wellness Programs. These include
    wellness programs that do not require participants to achieve a
    specific health outcome, but instead simply require them to take a
    certain action (e.g., obtain a flu shot, submit to a biometric
    screening, take a health risk assessment). HIPAA does not impose
    any requirements upon these types of programs, other than require
    that they be made available to similarly situated participants.
    These types of programs are regulated by, and the target of, new
    guidelines under the ADA, as described below.

  2. Health Contingent Wellness Programs. Health contingent
    wellness programs are those that require participants to attain a
    certain outcome or meet a health standard (e.g., run a 5k, maintain
    a certain cholesterol level, cease smoking, maintain a certain Body
    Mass Index (BMI)). These types of programs are required to comply
    with five standards under HIPAA:
  • The program must be reasonably designed to promote health or
    prevent disease.

  • Any reward offered cannot exceed 30% of the cost of coverage
    elected by the participant (increase to 50% for programs involving
    a tobacco cessation component).

  • The full reward must be available to all similarly situated
    individuals unless the program offers a reasonable alternative for
    obtaining the reward. (Note that different requirements apply for
    activity-only and outcome-based programs.)

  • Participants must be notified of the availability of the
    reasonable alternative.

  • Participants must be given the opportunity no less frequently
    than annually to attain the reward.

Americans with Disability Act

The ADA applies to employer-sponsored wellness programs that
include a medical exam or disability-related inquiry. Examples of
the types of programs that might be subject to the ADA include
health risk assessments that involve medical questions or biometric
screenings. Smoking cessation programs are not necessarily subject
to the ADA unless smoking status is determined based on a biometric
screening (medical exam) instead of a self-certification.

The ADA generally permits employers to make medical examinations
or inquiries in connection with a wellness program, but only if
such program is “voluntary.” For years, employers have
struggled in determining what constitutes a “voluntary”
program for these purposes. In 2016, the EEOC finally issued
regulations establishing certain parameters to assist employers in
determining whether a program would be considered voluntary.
Generally, those standards included the following:

  • The program is reasonably designed to promote health or prevent
    disease, is not overly burdensome, and is not a subterfuge for
    discrimination.

  • The program is not a “gateway plan”, requiring
    employees to submit to a medical exam or inquiry in order to access
    an enhanced benefits package.

  • Incentives to participate do not exceed 30% of the cost of
    self-only

  • The program offers a reasonable accommodation for persons for
    whom it is medically inadvisable to participate.

  • Participants are provided with a notice informing them of why
    their information is being requested, how it will be used, and how
    it will be protected.

Shortly after the rules were issued, the AARP challenged the
EEOC’s interpretation of the voluntariness standard, arguing
that they exceeded their regulatory authority in permitting
incentives of up to 30% of the cost of coverage. The District Court
agreed, and it struck down that portion of the
rule effective as of January 1, 2019 (the rest of the rule remained in force).

The newly proposed rule (described below) is intended to address
the Court’s directive that the EEOC reissue guidelines that
engage in a more thorough process detailing how it determined that
the incentive level met the ADA’s voluntary standard.

Genetic Information Nondiscrimination Act

GINA is generally intended to prevent employers from
discriminating against employees on the basis of genetic
information. The law broadly restricts employers from incentivizing
employees to provide genetic information or to provide medical
information about family members.

In 2016, the EEOC issued guidelines that established parameters
for how employers may collect genetic information or information
about family members without running afoul of GINA guidelines.
Under those rules:

  • Individuals must provide a knowing, voluntary, written
    authorization prior to disclosing such information.

  • Employers may not offer an incentive that exceeds 30% of the
    cost of self-only coverage in soliciting genetic information from
    the spouse of an employee.

  • Employers could not offer any inducement for genetic
    information about an employee’s child.

In the same legal challenge described above, the District Court
struck down the EEOC’s 30% threshold as applied to GINA (the
rest of the rule remained in force). The rule described below
attempts to issue new guidelines in accordance with the Court’s
directive.

Highlights of the New ADA Rule

The EEOC’s proposed rule takes a similar approach to the
earlier HIPAA rule, splitting wellness programs into two categories
and applying different rules to each:

  1. Participation-Only Wellness Programs. The proposed rule
    targets participation-only wellness programs, limiting incentives
    offered in connection with such a program to a “de
    minimis” standard. Any incentive offered that exceeds that
    threshold would be considered involuntary, in violation of the ADA.
    The rule offers the following examples:
  • Permissible Incentives: water bottles or gift cards of
    modest value

  • Impermissible Incentives: a paid annual gym membership
    or free airline tickets

The EEOC’s proposed rule requests comments on whether
additional examples would be helpful.

  1. Health Contingent Wellness Programs. The EEOC’s
    proposed rule would offer a “safe harbor” for any health
    contingent wellness program offered as part of a group health plan.
    Under the safe harbor, the program would be deemed to be in
    compliance with the ADA if it complies with the HIPAA rules
    described above.

Notably, the rules also appear to eliminate the
previously-required ADA notice described above. The EEOC explained
that because incentives will no longer be able to exceed a de
minimis threshold, no such notice would be required to ensure
voluntariness.

Highlights of the New GINA Rule

Under the proposed rule, employers can offer incentives to
encourage employees or their spouses to provide genetic
information, but those incentives must be no more than de minimis.
In a departure from the earlier rule, employers may offer
incentives to encourage provision of genetic information of
dependent children as well (as long as those incentives are no more
than de minimis).

Timing/Effective Date of EEOC Rules

The new EEOC guidelines are in proposed form, and the EEOC is
soliciting comments for 60 days following the date the rules are
published in the Federal Register. The EEOC will review any
comments received before issuing a final rule. Until the rules are
final, the EEOC has stated that they are “simply proposals and
they do not change the law or regulations.” It would be
important to caveat these comments though as follows:

  • Regulatory Freeze. As is common in new
    administrations, the Biden Administration has announced it intends
    to implement a broad-based regulatory freeze on all pending rules
    upon entering office. Presumably this rule will be included,
    although it is unclear whether the rule will ultimately be adopted
    by the new administration.

  • Interim Interpretation of ADA’s Voluntariness
    Standard.
    Even in the absence of this rule, the ADA remains an
    active law, including its undefined requirement that wellness
    programs must be voluntary. Participants in a wellness program
    could challenge any form of incentive on the basis that it renders
    the program involuntary (and there are pending lawsuits in which
    plaintiffs allege a seemingly reasonable incentive renders the
    program involuntary). There is some risk that a plaintiff could
    seize upon this proposed rule to argue that any incentive that
    exceeds a de minimis threshold is involuntary. To be clear, the
    current rule is only in proposed form and, as noted, the EEOC has
    made clear it is not “law.” But, employers should keep
    this proposal in mind as they implement new or review current
    wellness plans.

Considerations for Employers in Designing Wellness
Programs

If finalized, this rule could lead to some employers to either
scale back their participation-only wellness programs or to
gravitate toward health-contingent wellness programs. Under these
rules (and the HIPAA guidelines), employers would have far greater
flexibility to incentivize behavior under health-contingent
programs.

Similarly, the regulatory agencies have indicated in prior,
non-binding guidance that a participation-only wellness program
might be considered a health contingent wellness program if it only
targets participants based on health status (e.g., if only
diabetics have to take a biometric screening). Employers might
consider offering more targeted programs based on health status in
the hopes of avoiding the more restrictive ADA “de
minimis” standard. Under this approach, the wellness program
would need to comply with the other HIPAA requirements as discussed
above.

Finally, we understand that many employers are considering
whether and to what extent to incorporate a mandatory or
incentivized COVID vaccination program into their current wellness
design. These rules have the potential to impact any such design.
Click here for more on vaccine-related wellness
considerations.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.



Source link
.  .  .  .  .  .  . .  .  .  .  .  .  .  .  .  .   .   .   .    .    .   .   .   .   .   .  .   .   .   .  .  .   .  .