Feature
•
provide a reward to employees who complete a health risk
assessment regarding current health status without any further
action required by the employee.
Any rewards provided in connection with a participatory wellness
program do not count toward the current 30 and 50 percent
permissible reward thresholds of health-contingent programs.
Further, reasonable alternative standards do not need to be made
available under participatory wellness programs.
Health-contingent wellness programs (including “activity-only”
or “outcome-based” programs) must meet several requirements in
order to not discriminate based on health status:
•
frequency of opportunity to qualify—employees must be
able to qualify for the reward at least once per year;
•
size of reward—rewards may have a value for all health
contingent programs up to 30 percent of the total cost of
the annual premium for employee-only coverage (or up to
50 percent for programs to prevent or reduce tobacco use);
•
reasonable design—a reasonable standard must be imposed
to promote health or prevent disease that is not overly
burdensome or a subterfuge for discrimination based on a
health factor or highly suspect in method chosen to promote
health or prevent disease;
•
uniform availability for all similarly situated individuals
and reasonable alternative standards—if it is unreasonably
difficult due to a medical condition to meet the standard of
the program or to attempt to satisfy it, an alternative must be
provided or the participation in the program must be waived
to obtain the reward; and
•
notice of availability of reasonable alternative standards—
disclosures must be provided in all plan materials describing
the program regarding the availability of alternative standards
to qualify for the reward and, if applicable, the possibility of
a waiver of the otherwise applicable standard.
In addition to the foregoing, wellness programs must be analyzed
under many laws. Under the ADA, employers cannot discriminate
against disabled employers in connection with the terms, conditions,
or privileges of employment, or make disability-related inquiries
or require medical exams of employees (unless job-related and
consistent with business necessity). Under limited EEOC guidance,
such inquiries may be permissible under a wellness program if
the program is voluntary and employees are neither required to
participate nor penalized for non-participation. To date, the EEOC
has not published bright-line rules but, instead has brought litigation
against companies as a result of their wellness program practices.
In these cases, the EEOC has raised issues where programs impose
large penalties (such as full cost of insurance, cancellation of
insurance or even termination of employment) on employees for
12 | WINTER 2015
Studies regarding employee benefits
trends show that millennials (a
generation that began in the early
1980s), who have entered the workforce,
desire a wide array of employee benefits—
even more so than Generation X-ers or
baby boomers.”
refusing to participate in medical examinations, biometric testing
or health risk assessments (HRA) or make inquiries that violate
GINA. GINA requires that an HRA must state that any incentive
will be given for completing the HRA regardless of whether the
employee answers the questions seeking genetic information. The
outcome of these cases, and potentially others, is not yet clear but
must be monitored.
A wellness program could also potentially violate Title VII if
it results in disparate treatment or has a disparate impact on a
protected class. The program could also violate the ADEA, for
example, if it can be shown that the wellness program provides
financ