WELLNESS PROGRAMS
Wellness Programs
A Look At New EEOC Rules
In an effort to reduce health care costs, many employers offer wellness programs that seek to improve employee health and well-being by creating and maintaining healthy lifestyles as well as by promoting behaviors that prevent disease. Designing an effective wellness program can be complex, but Bowen, Miclette & Britt has all the necessary resources to help you create a program that suits your employees’ needs while also meeting your financial goals.
Wellness programs exist in many forms such as nutrition classes, health risk assessments, on-site exercise facilities and smoking cessation programs, just to name a few. They may also include health screenings that measure an employee’ s health risk factors such as cholesterol, BMI, glucose and blood pressure. Many employers offer incentives to their employees based on participation in the wellness program( participatory wellness programs) or based on the employee meeting certain health outcomes( health-contingent wellness programs).
For these programs to be offered, the Americans with Disabilities Act( ADA) requires that they be“ voluntary” programs. The ADA defines a voluntary wellness program as one whose incentives are 30 percent or less than the cost of employee-only coverage.
Previously, wellness programs were primarily regulated by the Health Insurance Portability and Accountability Act( HIPAA) nondiscrimination rules for wellness programs and the Affordable Care Act, with guidance from the ADA but with no definitive rules. On May 16, 2016, the Equal Employment Opportunity Commission( EEOC) released final rules applicable to employer-sponsored wellness programs. The new rules and guidance fall under Title I of the ADA, which permits collection of medical information under an employer’ s voluntary wellness program. Additionally, the EEOC published final regulations on wellness program participation by employees’ spouses under Title II of the Genetic Information Nondiscrimination Act( GINA).
WHEN ARE THE NEW EEOC RULES EFFECTIVE?
• For plan years beginning on or after January 1, 2017.
WHO MUST COMPLY WITH THE NEW EEOC RULES?
• Wellness programs that include disabilityrelated inquiries or medical examinations.
• Employers with fifteen or more employees( rules apply to all employees, not just those that are covered by an employersponsored medical plan).
HOW DO THE ADA FINAL RULES IMPACT WELLNESS PROGRAMS?
• Incentive maximums now apply to both participatory and health-contingent wellness programs.
• The 30 percent incentive maximum calculation is dependent upon whether employees who are not covered by the employer-sponsored medical plan are allowed to participate in the wellness program. There are four possible situations:
• If the wellness program is only offered to employees enrolled in the company medical plan, the incentive maximum may not exceed 30 percent of the cost of the employee-only coverage for which the employee is actually enrolled.
• If the wellness program includes employees who are not enrolled in the company medical plan and the employer only offers one medical plan, then the 30 percent maximum is based on the total cost of employee-only coverage.
• If the wellness program includes employees who are not enrolled in the company medical plan and the employer offers more than one medical plan option, then the 30 percent cap is based on the total cost of employee-only coverage for the lowest cost medical plan.
• If the employer does not offer an employer-sponsored medical plan, the 30 percent incentive maximum is based on the premium amount for a 40-yearold nonsmoker who purchases self-only coverage under the second lowest cost Silver Plan through the health insurance exchange where the employer has its headquarters
• If an employer offers tobacco cessation
BY: IMOGEN GANTOS, HEALTH AND PRODUCTIVITY DIRECTOR, BOWEN, MICLETTE & BRITT INSURANCE AGENCY, LLC
incentives and conducts tests for the presence of nicotine or tobacco, the incentive maximum is 30 percent. But if an employer does not do testing and only asks the employee if they use tobacco products, then the incentive maximum may be increased to 50 percent.
• All incentives count toward the incentive maximum. This may even include incentives provided by the health plan, like a $ 50 gift card for completing a health risk assessment( HRA) or telephonic coaching.
• Employers are not allowed to use wellness programs to preclude an employee from enrolling in certain health plans.
• A new notice is required which describes what information will be collected as part of the wellness program, who will receive it, how it will be used, and how it will be kept confidential.
• An employer may only receive aggregate data from the wellness program.
• The voluntary plan safe harbor does not apply to wellness programs.
HOW DO THE GINA FINAL RULES IMPACT WELLNESS PROGRAMS?
• Employers must obtain a voluntary written authorization from the spouse if the employer offers an incentive to the employee for his or her spouse to complete an HRA or biometric screening.
• The value of the maximum incentive attributable to a spouse’ s participation may not exceed 30 percent of the total cost of self-only coverage, which is the same incentive allowed for the employee.
• No incentives are allowed in exchange for the current or past health status information of an employee’ s child or in exchange for the specified genetic information( such as family medical history or the results of genetic tests) of an employee, an employee’ s spouse, or an employee’ s child. +
Imogen Gantos is the Health and Productivity Director at Bowen, Miclette & Britt, an insurance agency based in Houston, Texas.
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