Wellness Incentives Update

Federal laws affect the design of wellness programs, including two laws that are enforced by the Equal Employment Opportunity Commission (EEOC)—the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA). Before the EEOC issued its final wellness program rules, it was unclear whether incentives to participate in a wellness program were permissible and, if so, in what amount.

  • The final ADA rule provides that incentives offered to an employee who answers disability-related questions or undergoes medical examinations as part of a voluntary wellness program may not exceed 30% of the total cost for self-only health plan coverage.
  • The final GINA rule clarifies that an employer may offer an incentive of up to 30% of the total cost of self-only coverage to an employee whose spouse provides information about his or her current or past health status as part of the employer’s wellness program.

Neither the ADA nor GINA define the term “voluntary” in the context of wellness programs.

On Dec. 20, 2017, the U.S. District Court for the District of Columbia vacated key provisions of the EEOC’s final rules, stating the EEOC failed to provide a reasoned explanation for the incentive limit and sent the final rules back to the EEOC for reconsideration. To avoid disruption to employers, the court stayed its ruling until Jan. 1, 2019.

Employers should be careful about structuring wellness program incentives that ask for health information or involve medical exams. It is possible the EEOC will issue new rules prior to 2019

Reference the below Bulletin for additional detail and contact your NEEBCo representative with questions.

Court Vacates EEOC’s Wellness Rules for 2019