The United States Equal Employment Opportunity Commission (EEOC) revoked a previous rule establishing incentive limits under the Americans with Disabilities Act (ADA) and Genetic Information Non-Disclosure Act (GINA) wellness regulations. This action follows a previous federal court decision vacating the incentive sections of the ADA and GINA wellness rules.
Wellness programs are regulated in part by the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Affordable Care Act (ACA). HIPAA prevents health plans and insurers from discriminating on the basis of “any health status related factor,” but allows covered entities to offer “premium discounts or rebates” on a plan participant’s copayments or deductibles in return for that individual’s compliance with a wellness program.
However, because employer-sponsored wellness programs often involve the collection of sensitive medical information from employees, including information about disabilities or genetic information, these programs often implicate the Americans with Disabilities Act (ADA) and Genetic Information Nondiscrimination Act (GINA) as well. As both the ADA and GINA are administered by the EEOC, this brings wellness programs within EEOC’s purview.
The ADA prohibits employers from requiring medical examinations or inquiring whether an individual has a disability unless the inquiry is both job-related and “consistent with business necessity”. But the ADA makes some allowances for wellness programs: it provides that an employer may conduct medical examinations and collect employee medical history as part of an “employee health program,” as long as the employee’s participation in the program is “voluntary”. The term “voluntary” is not defined in the statute.
Similarly, GINA prohibits employers from requesting, requiring, or purchasing “genetic information” from employees or their family members. The definition of genetic information includes an individual’s genetic tests, the genetic tests of family members such as children and spouses, and the manifestation of a disease or disorder of a family member. Like the ADA, GINA contains an exception that permits employers to collect this information as part of a wellness program, as long as the employee’s provision of the information is “voluntary”. Again, the meaning of “voluntary” is not defined in the statute.
In May 2016, the EEOC published final rules adopting incentive limits under the ADA and GINA wellness rules. These rules were issued in an effort to clarify the interaction between the ADA and GINA’s voluntariness provisions and HIPAA. The incentive sections allowed employers to offer employees the incentive of up to 30% off the cost of the employee’s insurance premiums if the employee participated in a wellness program, which may require the worker to disclose disability-related information or the medical information of family members.
In October 2016, AARP filed a complaint against the EEOC challenging the incentive sections of both the GINA and ADA regulations. The court ultimately held that the EEOC did not provide sufficient justification as to how the adoption of the incentive limits render participation “voluntary” under the ADA and GINA. The court remanded the Rules to the EEOC for further consideration and eventually issued an order vacating the incentive sections of the ADA and GINA rules. As a result, the EEOC revoked its rules setting a 30% cap on the incentives for participating in a wellness program.
This decision will not impact wellness programs that are compliant with the HIPAA, ADA, and GINA final regulations. Employers are advised to take a conservative approach with economic incentives for wellness programs. Since it is unclear what, if any, next steps will be taken by the EEOC regarding wellness incentives, employers should still be cautious about offering incentives over the threshold until further guidance is offered by the EEOC.
Fishel Downey Albrecht & Riepenhoff LLP will keep its clients apprised of developments in this area. For questions about health plans, HIPAA, the ADA, or GINA, please contact Marc Fishel (mfishel@fisheldowney.com) or Angel Jarmusz (ajarmusz@fisheldowney.com) by email or phone at (614) 221-1216.