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May 25, 2016

EEOC Issues Final Rules on Employer Wellness Programs

The U.S. Equal Employment Opportunity Commission (EEOC) has issued final rules allowing employers to apply financial incentives or penalties for participation in employee wellness programs.  The new rules clarify the extent of incentives or penalties that employers may issue without running afoul of federal anti-discrimination laws that prohibit employers from obtaining and using information about workers’ health conditions and that of family members except in a “voluntary” wellness program.

One rule amending regulation and guidance under Title I of the Americans with Disabilities Act (ADA) states that employers may provide financial and in-kind incentives of up to 30% of a health plan’s cost in exchange for an employee answering disability-related questions or taking medical examinations as part of a wellness program, or impose a corresponding penalty of up to 30% on employees who do not answer the disability-related questions or undergo the medical examinations.  (See final rule at https://www.federalregister.gov/articles/2016/05/17/2016-11558/regulations-under-the-americans-with-disabilities-act)

Another rule amends regulations implementing Title II of the Genetic Information Nondiscrimination Act (GINA) to allow incentives (or penalties) in exchange for an employee’s spouse providing information about his or her current or past health status as part of a wellness program.  This kind of information usually is provided as part of an HRA, which may include a questionnaire or medical examination, such as a blood pressure test or blood test to detect high cholesterol or high glucose levels.  GINA does not apply to inducements made available in exchange for an employee’s spouse engaging in certain activities that do not require obtaining information about current or past health status, such as attending a weight loss or nutrition program or exercising a certain amount each week.  (See final rule at https://www.federalregister.gov/articles/2016/05/17/2016-11557/genetic-information-nondiscrimination-act )

The new rules also prohibit employers from retaliating against any employee who refuses to participate or whose spouse refuses to provide information.  The rules will become applicable on the first day of an employer’s first plan year that begins on or after January 1, 2017.

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