Wellness plans: waiting for the EEOC

Wellness plans: waiting for the EEOC

The Patient Protection and Affordable Care Act will increase the incentive limit in outcome based wellness  programs from 20 to 30 % of employee total health care premiums in 2014.  Many employers believe that the road to more and better employee participation is greater incentives; after all, human nature and  motivation are involved.  There is a catch--the EEOC has not made its position known on how incentives or penalties and "voluntary" participation are impacted by such programs.

In Seff v. Broward County, the 11th Circuit upheld the district court's finding that the county's wellness plan fell within the "bona fide plan" safe harbor of the ADA.  The plan had two components: a bio-metric screening (finger prick) for glucose and cholesterol and an online questionnaire of health risks.  The information identified employees who had asthma, congestive heart failure, hypertension, diabetes, or kidney disease.  Employees identified as suffering from any of these diseases were given the opportunity to participate in a disease management coaching program.  To promote participation, the county initially imposed a twenty dollar biweekly charge to employees who did not participate  but suspended the charges approximately nine months later.

The district court concluded that the wellness plan fell within the safe harbor provisions of the ADA because the program constituted a "term" of the county's group health plan.  The appeals court noted that it was not aware of any authority that suggested a wellness plan must be explicitly identified in a benefit plan's written documents to qualify as a "term" of the benefit plan within the meaning of the ADA's safe harbor provision.  The issue of whether the plan was voluntary was not raised and not considered in the case.

What is the EEOC's position on the applicability of the insurance safe harbor for wellness  plans?  What incentives, if any, does the EEOC consider to impact the issue of "voluntary" participation?  Does the EEOC agree with the Seff decision?

 The agency has held hearings on issues such as credit history and hiring; the impact of arrest an conviction records; and unemployed status and hiring.  The issues of wellness plans and whether the agency has issues with the current usage by employers and the impact of the insurance safe harbor certainly merits time and consideration.  Employers are entitled to know the EEOC's position and should, at a minimum, be given a time frame by the agency for when it will address these issues.

Lexis.com subscribers can access the Lexis enhanced version of the Seff v. Broward County, 2012 U.S. App. LEXIS 17501 (11th Cir. Fla. Aug. 20, 2012), decision with summary, headnotes, and Shepard's.

For additional Labor and Employment law insights from John Holmquist, visit the Michigan Employment Law Connection.

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