Scott Pashley is a Certified Healthcare Reform Specialist and fifteen year veteran of the health & wellness industry
In an attempt to cut through the confusion of the alphabet soup of legislation governing corporate wellness programs – and quite frequently contradicting one another – the Equal Employee Opportunity Commission (EEOC) has issued their final rules. Ironically, it’s been the EEOC that has caused much of the confusion by unsuccessfully filing suit against companies that they thought overstepped in their wellness programs.
The final rules, which will go into effect January 2017, take into account the ADA, ACA, HIPPA, DOL, and GINA rules and regulations and lay out employer’s rights and responsibilities when it comes to their wellness program.
None of what the EEOC has presented in the final rules is surprising or game changing. Here are the most important things to know;
What’s the Incentive Limit?
All of the existing legislation was in agreement on limiting incentive value to 30% of the cost of individual coverage for participating in a wellness program. The EEOC final rules uphold that limit, with a couple nuances, and also extend it to tobacco cessation programs. Under the ACA regulations employers were able to go as high as 50% of the total cost of individual coverage to motivate employees to kick the cancer-causing habit.
As of January, 2017, however, the EEOC regulations will mandate that incentives may not exceed 30% where medical tests are employed to determine tobacco usage. This is where you need to pay attention because there is a twist– employers can still provide incentives worth up to 50% of self-only coverage for tobacco cessation if – AND ONLY IF – the method for determining tobacco use is a question instead of a medical test.
Here are some more important nuances to keep in mind as you design incentive programs;
- If employers require employees to be enrolled in a certain health plan in order to participate in a wellness program incentives are limited to 30% of total cost of self-only coverage for the insurance program the employee is enrolled in. No surprise, but it gets a little more complicated from here…
- When an employer offers more than one self-only plan and DOES NOT require employees to be enrolled in any particular plan in order to participate in a wellness program the incentive limit is placed at 30% of the lowest cost self-only major medical plan option offered by the employer.
- In the event the employer does not offer a health plan option at all but does have a wellness program the incentive may not exceed 30% of self-only coverage for a 40-year old non-smoker on the second lowest cost Silver plan as offered on the state or federal exchange in the geographic location of the employer’s principal place of business.
Finally, the EEOC rule does clearly stipulation that incentives can be financial and in-kind, meaning gifts, cash, insurance premiums, time off, etc…
This is the question that has been at the heart at some of the high profile law suits that the EEOC has filed against employers. The rule states the wellness programs which ask health-related questions and include certain medical examinations, including biometric screenings, are voluntary and therefore legal.
It also stipulates that;
- An employer may not require participation in a wellness program,
- May not deny access to health coverage or even limit plan options to an employee who does not participate in a wellness program,
- May not take any other adverse action or otherwise discriminate against an employee who does not participate in a wellness program or who fails to achieve specific health outcomes.
That top point regarding employer’s being prohibited from requiring participation in a wellness program as a prerequisite for access to employer-sponsored healthcare may be challenged. In the case of EEOC vs Flambeau Inc., a district court upheld the employer’s right to require employees to complete a health screening in order to have access to the company’s health insurance plan.
Staying compliant with your wellness program can be challenging but we can help. Please let us know if you would like more information on whether or not your program meets the rules and regulations.
Reach out to Scott Pashley @ email@example.com.