A Challenge to the EEOC’s Employer Wellness Plan Rules

The EEOC Employer Wellness Plan rules are scheduled to take effect January 2017. The rules allow employers to offer both incentives and disincentives for employees who choose to participate or not to participate in employee wellness programs. The new rules do not, according to the EEOC, violate any of the provisions of the Americans with Disabilities Act (ADA) or the Genetic Information Nondiscrimination Act (GINA). But AARP disagrees, and has filed suit to stop the new regulations from taking effect.

The ability of an employer to create incentives for employees who participate in employee wellness programs and penalties for employees who do not participate is a reversal of a longstanding EEOC policy that prohibited employers from accessing employee’s privacy-protected health information. The AARP alleges the new rules violate HIPPA, the Health Care Portability and Privacy Act, as well as the ADA and GINA.

Penalties can include a decreased share in the employer’s contribution to health insurance coverage, which the AARP believes can be considered an extreme financial burden on an employee. In order to avoid the financial burden, employees feel pressured to reveal private health information. The new regulations also don’t adequately describe how families will be impacted if both spouses have health insurance coverage penalized for failing to participate in employee wellness programs.

The Affordable Care Act already allows employers to assess penalties and incentives on health insurance premiums for participation in employee wellness programs. The program allows a maximum of 30% of insurance premium contribution, and 50% for participation in tobacco cessation programs. The new rules increase the allowable incentive or penalty to 60% of health insurance premium employer contribution.

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