Final EEOC Wellness Rules Put Incentives Front and Center


Smoke Break

Employers that sponsor wellness programs should carefully review new regulations and limits to incentives under the Equal Employment Opportunity Commission’s final rules on wellness programs, and make sure they don’t conflict with existing wellness program requirements.

The two EEOC final rules, one under the Americans with Disabilities Act (RIN 3046-AB01) and the other under the Genetic Information Nondiscrimination Act (RIN 3046-AB02), were released May 16 and become effective on the first day of the first employer health year that begins on or after Jan. 1, 2017.

The agency’s final rules amend existing GINA regulations and create new ADA regulations detailing how employers can offer inducements for wellness plan participation, while ensuring they don't coerce employees or their covered spouses to submit to involuntary medical exams or to divulge genetic information, which includes family medical history.

The EEOC final rules allow employers to offer employees and their spouses inducements of up to 30 percent of the costs of self-only coverage. The inducement limits apply both to participatory and health-contingent wellness plans.

Under the final ADA rule, voluntary wellness programs that ask questions about employees' health or include medical examinations may provide participation incentives of up to 30 percent of the total cost for self-only coverage. Similarly, the final GINA rule provides that the maximum incentive offered for an employee’s spouse's voluntary participation may not exceed 30 percent of the total cost of self-only coverage.

In contrast to the EEOC final rules, the Health Insurance Portability and Accountability Act as modified by the Affordable Care Act provides financial inducements only under health-contingent wellness programs--those programs in which employees receive rewards for attaining specified wellness goals. Also under the HIPAA and the ACA, employees may provide incentives of up to 30 percent of the total cost for self-only coverage and incentives of up to 50 percent of such costs for tobacco-cessation programs. Spousal coverage was not provided under the HIPAA and the ACA regulations.

The 2013-released HIPAA and ACA regulations stipulate that employers can offer employees incentives of up to 50 percent of self-only health insurance costs when wellness plans simply ask employees if they smoke.  However, the EEOC rules limit incentives to 30 percent of self-only health insurance costs when wellness plans require medical testing to determine if employees smoke.

The EEOC's final rules under the ADA apply to all employer-sponsored wellness programs that include disability-related inquiries and medical exams, not just to those programs offered as part of a group health plan. The GINA rule applies to all health plans that offer wellness programs including spousal coverage.

See related story, EEOC Issues Final Rules on Wellness Plan Incentives.

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