Human Resources News & Insights

Wellness incentives fixed firmly in EEOC’s crosshairs: 2 rules to watch

The Equal Employment Opportunity Commission’s (EEOC) spring Regulatory Agenda has revealed some potentially disturbing developments for those with company sponsored wellness programs. 

The agenda revealed that the EEOC intends to issue two proposed rules in the coming months.

How do the ADA and wellness incentives/penalties mix?

The first rule is referred to as “Amendments to Regulations Under the Americans With Disabilities Act.”

The EEOC’s description of the rule, which the EEOC estimates will come out this summer:

This proposed rule would amend 29 CFR section 1630.14(d) to address whether, and to what extent, title I of the Americans with Disabilities Act (ADA) allows employers to offer financial inducements and/or impose financial penalties as part of wellness programs offered through their health plans, and to address other aspects of wellness programs that may be subject to the ADA’s nondiscrimination provisions.

What this means: The rules around the kinds of incentives wellness programs can offer have undergone extensive tinkering over the past few years. Most recent round of changes was the result of the Affordable Care Act.

What employers have been left with are a lot of unanswered questions about what’s legal and what isn’t when it comes to wellness incentives and penalties.

At the heart of the problem is the fact that while many employers would love to be able to offer financial incentives or penalties to drive employees to meet certain health goals in wellness programs, setting blanket health goals isn’t fair. The reason is because disabled individuals may not be able to meet those goals.

As a result, there are questions surrounding what kinds of goals are legal and how employers can safely establish alternative goals for disabled individuals.

This section of the EEOC’s new Regulatory Agenda seems to suggest the agency is out to clear the air in this area. But what employers don’t want to see is an expansion of the ADA that would make it even more difficult to design effective wellness programs, penalties and incentives.

Based on the EEOC’s vague description of the rulemaking process, it hard to say which form the regulations will take.

How do GINA and wellness mix?

The second proposed rule is entitled “Amendments to Regulations Under the Genetic Information Nondiscrimination Act of 2008.”

The EEOC’s description:

This proposed rule would amend 29 CFR sections 1635.8(b)(2) and 1635.8(c)(2) to resolve the frequently-asked question of whether employers may offer inducements to employees’ spouses or other family members who answer questions about their current medical conditions on a health risk assessment (HRA). Additionally, some technical amendments would correct a typographical error in the rule’s discussion of wellness programs and would add references to the Affordable Care Act (ACA), where appropriate.

What this means: This seems to indicate the EEOC simply wants to clear the air about the kinds of questions employers can ask in health risk assessments that have financial incentives tied to them.

The hope, at least among employers with wellness programs, is the EEOC will allow them to continue to offer financial incentives to encourage employees and their family members to take such assessments — but, again, you never know where the feds’ heads are at.

The Genetic Information Nondiscrimination Act (GINA) was created to prevent employers from discriminating against employees based on those employees’ “genetic information” and family medical history.

As a result, the EEOC has instructed employers to NOT tie financial incentives to health risk assessments that may divulge, even if inadvertently, employees’ genetic info or family medical history.

The EEOC’s also expected to issue this proposed rule before summer’s out.

But until then, here’s our breakdown of the latest guidance on how to make sure your company doesn’t violate GINA with health risk assessments.

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  • Jon

    This is a beginning – eventually everyone will realize that the latest round of coercive, incentive-laden wellness programs propelled on by the bogus Safeway Ammendment in the ACA are a mistake – As non-partisan research makes clear – they do not save money and they are associated with numerous iatrogenic consequences – not the least of which are over-diagnosis/over-treatment and decreased employee engagement, neither of which this country is in any position to afford – Jon – PhD, MS