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The Equal Employment Opportunity Commission (EEOC) issued rules in 2016 governing how wellness plans can be structured to comply with the Americans with Disabilities Act (ADA) and Genetic Information Nondiscrimination Act (GINA).  The types of wellness activities that typically fall under the EEOC’s jurisdiction include biometric screenings and health risk questionnaires.

However, the AARP sued the EEOC under the Administrative Procedures Act, arguing that the EEOC’s 30% incentive limit was too high to make participating in these programs “voluntary.”  The DC court agreed that the EEOC’s explanations for settling on a 30% incentive limit were unclear and not well reasoned/defined, so the 30% incentive limit portion of the final 2016 rules were sent back to the EEOC for further clarification or modification.  But with a due date the EEOC couldn’t meet, the incentive limits were struck down effective 2019.

Under newly rulemaking, the EEOC is taking another stab at this topic that tends to be prone to litigation, and that litigative history has them playing it safe by not providing a percentage or dollar value limit but instead proposing we go back to de minimis incentive limits.  Public comments will be accepted for 60 days from publication in the Federal Register.

• The proposed “responds to the court’s finding that a 30 percent incentive limit is not the appropriate measure for voluntariness and, instead, imposes a de minimis incentive limit for most wellness programs that include disability-related inquiries and/or medical examinations.”
  • This means an employer “does not offer more than a de minimis incentive (such as a water bottle or gift card of modest value) in exchange for an employee participating in the wellness program (unless the program is a health-contingent wellness program” under HIPAA’s established rules and incentive limits)
    • This does seem to suggest that if the biometric screening ultimately results in incentives for meeting health-contingent outcomes, such as having cholesterol or BMI within a certain range or improving a certain percentage compared to the prior year’s screening, then it must comply with the ADA as a medical exam but can offer more than a de minimis incentive due to its compliance with HIPAA rules
  • With these programs being proposed to only allow a de minimis incentive, the EEOC is proposing to remove the requirement that these programs be “reasonably designed to promote health and prevent disease” and to remove the separate ADA wellness notice requirement
  • “Employers may not condition participation in a wellness program on an employee allowing information to be disclosed to a third party”
  • The types of wellness activities that fall under the ADA are any type of medical exam (including a biometric screening) or disability related inquiry (such as a health risk questionnaire)
• The proposed likewise “would limit wellness programs to offer a de minimis incentive to all family members, not just spouses, in exchange for family members providing information about their manifestation of diseases or disorders.”
  • However, “the EEOC invites comments on possible justifications under Title II of GINA for adoption of a higher than de minimis incentive level, as well as the maximum amount of such an incentive” supported by studies and real world examples
  • They will hold to the rule “that participation in a wellness program that collects genetic information is lawful only when prior, knowing, voluntary, and written authorization is obtained,” meaning an advance notice will remain required
  • With these programs being proposed to only allow a de minimis incentive, the EEOC is proposing to remove the requirement that these programs be “reasonably designed to promote health and prevent disease”
  • The type of wellness activities that fall under Title II of GINA would be a spouse (and perhaps going forward, other family members on the health plan) participating in a biometric screening and/or answering a health risk questionnaire about his/her own health history.  Asking individuals about their “family medical history or other genetic information” would remain prohibited.

IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information.

This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.