This webinar will discuss the major federal laws that impact workplace wellness program design, including the Affordable Care Act/HIPAA Nondiscrimination rules on the use of financial incentives, the Americans with Disabilities Act (ADA), the Genetic Information Nondiscrimination Act (GINA), federal tax laws as well as recent EEOC action such as the proposed ADA rules and lawsuits against Honeywell, Flambeau and Orion Energy Systems. Through case examples, the speaker will explain how each of these laws interact with one another, who enforces these laws, what to expect in terms of future guidance, and how health promotion professionals can use these laws as tools in designing more effective and inclusive workplace wellness programs.
7. Preventive Law
• Law has 2 purposes:
– Protection from those who do wrong
– Facilitate human interaction and purpose
• Preventive law focuses on second
purpose
• Leads to using law proactively as tool
– Sensitizes designers of wellness programs
to diverse employee needs
11. Examples
• Workers must pay higher premiums if can’t
meet BMI standard or refuse to participate.
– Female employee with Type 1 diabetes and breast feeding
unable to meet BMI standard.
– Employer reduced her weight-loss goal.
– Employee’s doctor advised her not to lose weight.
– Employer required that she work out with trainer at company
gym for 130 minutes/week at her own cost. Unable to meet
alternative standard, premium increased from $175/month to
$320/month.
12. Examples
• Penn State
– “Take Care of Your Health” in Summer 2013
– Used an outside vendor to administer health
questionnaire
• Asked questions about:
– Problems with supervisor
– Separation or divorce
– Finances
– Fear of job loss
– Female employees whether they plan to become pregnant
over the next year
– $100/month surcharge for nonparticipation
16. HIPAA
• HIPAA Nondiscrimination
– Overseen by HHS, DOL and Treasury
– Generally prohibits discrimination by group
health plans based on “health factors.”
– Carves out exception for wellness
programs
• Can vary benefits (including cost-sharing)
based on whether person meets standards of a
wellness program.
17. HIPAA
• ACA changes to HIPAA (eff. 1/1/14):
– Codifies 2006 wellness program rules into 42 USC
s. 300gg-4(j).
– Extends nondiscrimination rule to individual health
insurance (but not wellness program rule).
– Increases the “reward” from 20% to 30% of the
cost of coverage (50% for tobacco use prevention
programs).
– Adds stricter requirements for health-contingent
plans.
18. HIPAA
• To qualify for wellness program
exception, must meet certain conditions:
– Participatory programs must only be
offered to “similarly situated” individuals.
• No limit on financial incentives.
– Benign discrimination provision
– Health-contingent programs must meet 5
factor test.
19. HIPAA
• Participatory program examples:
– Fitness center membership reimbursement
– Reward for participating in health
assessment
– Waiver of health plan cost-sharing for
preventive items or services
– Smoking cessation program
reimbursement
– Reward for attending health education
seminar
20. HIPAA
• Distinction between participatory and
“health contingent” is whether reward is
tied to:
HEALTH STATUS
21. HIPAA
• Two types of health-contingent
programs:
– Activity
• May seek verification from physician that health
factor makes it unreasonably difficult or
medically inadvisable to satisfy activity.
– Outcomes-based
• May not seek verification
• Both must meet 5 factor test.
24. HIPAA
• Five factors:
1. Qualify for the reward at least once/year.
2. Total reward may not exceed 30% (50%
for tobacco prevention programs) of total
cost of coverage.
3. Reasonable design to promote health or
prevent disease.
25. HIPAA
• Five factors (cont.)
4. Full reward must be available to all
similarly situated individuals.
• Must provide reasonable alternative standard
(or waiver of standard)
5. Disclosure of reasonable alternative
standard (or waiver) in plan materials
describing the wellness program terms.
27. ADA
• Prohibits discrimination by employers on basis of
disability in regard to terms, conditions and privileges
of employment.
– Discrimination includes:
• Requiring medical examinations; and
• Making inquiries as to whether employee has disability
unless such exam or inquiry is:
– Job-related and consistent with business necessity
• Particularly pertinent for HA’s and Biometric Screens.
• Must provide equal opportunity for disabled
employees to participate in programs and offer
reasonable accommodations.
28. ADA
• Carves out exception for “voluntary”
wellness programs.
– According to EEOC Enforcement
Guidance, a wellness program is voluntary
as long as employer neither:
• Requires participation; nor
• Penalizes employees who do not participate.
• Must keep exam/inquiry records
confidential.
29. ADA
• Safe harbor for administering terms of
bona fide benefit plan
– Based on underwriting risks, classifying
risks or administering such risks.
– Applies whether exam/inquiry is voluntary
or not.
– Seff v. Broward County, 691 F.3d 1221
(11th Cir. 2012).
30. EEOC Proposed ADA Rules
• Three primary changes:
1. Aligns ADA with ACA by imposing 30%
incentive
2. Imposes incentive limit on participatory
programs
3. Requires employee notice and
privacy/security protections with regard to
wellness information
31. EEOC Proposed ADA Rules
• Aligns with ACA incentive rules
– 30% max incentive
33. EEOC Proposed ADA Rules
• May not deny/limit coverage for
nonparticipants.
34. EEOC Proposed ADA Rules
• Programs that collect medical
information must provide employees
with notice.
35. EEOC Proposed ADA Rules
• Employers and vendors must protect
health information confidentiality
36. EEOC Proposed ADA Rules
EEOC expects group health plan programs to
abide by HIPAA privacy/security rules
• Employer certification requirements for those who
administer programs
• Best practice: separate those who handle
individually identifiable health information from
those who make employment-related decisions
• Use of a third-party vendor may help
37. EEOC Proposed ADA Rules
• Employers and Vendors should have
clear privacy policies and procedures
related to medical information:
– Collection
– Storage
– Disclosure
• Include employee training
38. EEOC Proposed ADA Rules
• Reasonably designed to promote
health/prevent disease
– Should provide follow-up after collecting
medical information
– Should not be about collecting information
only.
39. EEOC Proposed ADA Rules
• Must provide reasonable
accommodations (Equal Opportunity)
40. EEOC Proposed ADA Rules
Equal Opportunity applies to both participatory
and health contingent programs.
41. EEOC Proposed ADA Rules
• Compliance with ADA rules does not mean
compliance with other laws:
– Title VII
– Equal Pay Act
– ADEA
– GINA
– Other ADA sections
• Proposed rules to align GINA with ACA
incentive rules forthcoming (presumably)
42. EEOC Proposed ADA Rules
• EEOC welcomes comments by Friday,
June 19, 2015
43. GINA Title I
• Title I generally prohibits group health
plans from:
– Adjusting premium or contribution amounts
based on genetic information;
– Requesting/requiring genetic testing;
– Requesting/requiring/purchasing genetic
information for underwriting purposes or
in connection with open enrollment.
44. GINA Title I
• “Genetic information”
– Genetic tests of individual or family
members
– Manifestation of disease or disorder in
family members (“family medical history”)
• “Family” includes spouses and adopted
children and dependents of spouses.
– Receipt of genetic services
45. GINA Title I
• Helpful tips for HRA administration:
– Do not ask questions about genetics and
family history;
– If open-ended questions could invite
disclosure of genetic information, include
disclaimer to not provide genetic
information.
• Examples: “Have you had any lab tests this
year?” or “Any other information about your
health you would like to share?”
46. Recent Cases
• EEOC v. Orion Energy Systems, 2:14-
cv-1019
• EEOC v. Flambeau, Inc., 3:14-cv-638
• EEOC v. Honeywell International, Inc.,
14-cv-4517
47. Recent Cases
• Case similarities:
– All still pending as of early 2015
– All brought to EEOC attention by employees
– All dealt with participatory wellness programs
involving HRAs and/or biometric screens
– All tied reward to health plan contributions
– In all cases, EEOC claimed wellness program
violated ADA and/or GINA, even though program
complied with HIPAA
– In all cases, defendants raised ADA safe harbor
48. Recent Cases
• EEOC arguments in Honeywell:
– Reward “too substantial” to be “voluntary”
under ADA. Nonparticipants:
• Do not qualify for $250-$1500 HSA
• Pay $500 surcharge
• Assessed $1000 tobacco surcharge unless:
– Enroll in cessation program (actual cessation not required);
– Submit physician report about no tobacco use; or
– Work with health advocate.
49. Recent Cases
• EEOC argued Honeywell violated GINA
because Honeywell:
– Will contribute to HSA if employee’s
spouse participates;
– Imposes $1000 tobacco surcharge if
spouse refuses to participate.
• Spousal biometric tests=family medical history
• Surcharge made program involuntary
50. Recent Cases
• Honeywell countered:
– Program was voluntary (no discipline or
loss of coverage)
– Tobacco surcharge had reasonable
alternatives
– Biometric measures did not=genetic
information
– EEOC did not have jurisdiction to enforce
part of bona fide group health plan
– ACA endorses use of surcharges
51. Recent Cases
• Lessons learned:
1. Complaints originated from employees
a. Create positive wellness culture
b. WELCOA 7 Benchmarks
2. Tie worksite wellness program to group
health plan.
b. Allows for ADA safe harbor and may
eliminate EEOC GINA jurisdiction.
3. 100% premium penalty catches EEOC
attention
52. Other Federal/State
• Fair Labor Standards Act
• Age Discrimination in Employment Act
• Title VII
• Internal Revenue Code
• State Laws
53. Other Federal/State
• FLSA
– Generally requires payment for all hours
worked
• Federal minimum wage
• 1.5x for overtime (over 40 hours/week)
54. Other Federal/State
• FLSA
– To avoid FLSA, wellness program
participation should be:
• Outside of work;
• Voluntary;
• Not job-related;
• No productive work performed
– Tip: Emphasize voluntary nature of
attendance.
55. Other Federal/State
• ADEA
– Prohibits employers with 20 or more
employees from discriminating based on
individual’s age (40 and over).
• Older workers might have harder time
achieving certain health-related
standards/goals.
• EEOC enforces.
• Lee v. City of Moraine Fire Dept., 2014 WL
1775621 (S.D. Ohio, May 2, 2014)
56. Other Federal/State
• Title VII prohibits employment
discrimination based on:
• Race
• Color
• Religion
• Sex
• National Origin
– Gender and religious discrimination most
likely in wellness program design.
– Enforced by EEOC and DOJ
57. Other Federal/State
• Internal Revenue Code
– Excludes from gross income amounts
received for “medical care”
• Expenses beneficial to general health or
wellbeing not “medical care” expenses
– E.g. Gym memberships usually taxable
– On-site athletic facilities not taxable
– De minimus benefits excludable
– Cash or cash equivalent incentives not
excludable from gross income
58. Other Federal/State
• State Laws:
• Scope of practice/licensing
• Flu Shots, Coaching, Diet Advice
• Off-duty conduct protection
– Smoking, Alcohol
• Negligence and Worker’s Compensation
• State Fair Employment Acts
• State insurance laws
• State grant programs
59. Case Scenario #1
• The WeCARE plan wants its participants to
complete a health/family medical history
questionnaire and measure the participants’
cholesterol, blood pressure, and BMI. The
plan notifies participants that they will be
responsible for paying 100% of the plan
premium if they do not complete the
questionnaire and screen. Is this
permissible?
60. Case Scenario #2
• Same facts as Scenario #1, but
WeCARE also requires those who do
not meet a certain BMI standard to pay
100% of the premium unless they enroll
in a weight management or exercise
class that meets every day from 4 to 6
pm, Monday through Friday. Is this
program compliant?
61. Case Scenario #3
• Acme, Inc., employer who offers the
WeCARE plan to employees, decides to
offer free noon-time Insanity workout
classes to all employees. Employees
who attend 80% of the eight-week
session receive a $50 gift card to IHOP.
Are there any compliance issues with
this program?
62. Preventive Law Checklist
Is program part of group health plan?
ACA & new ADA incentive rules vs. not
Does employee get reward regardless of results?
Participatory vs. Health Contingent
Is reward tied to health coverage cost sharing?
New ADA limits and EEOC cases
If Health Contingent, do we meet ACA 5-factor test?
Does HRA ask about family history or other sensitive
information?
If yes, does employee get reward regardless? Think Penn State.
63. Preventive Law Checklist
Are there spousal biometric tests?
If yes, EEOC may view as family medical history and may want to
omit incentives. See Honeywell case.
Are reasonable accommodations or waivers
available so all employees have equal opportunity to
earn reward?
Did we provide notice of the availability of
reasonable accommodations or waivers?
Do we offer follow-up after collecting health
information?
64. Preventive Law Checklist
Is the program sensitive to the varying abilities and
life circumstances of our employees?
Have we reviewed our confidentiality obligations,
policies and procedures?
Has our vendor reviewed its confidentiality
obligations, policies and procedures?
Have we obtained employee buy-in and
communicated the purpose/rationale of the program
before roll-out?
Will this program cause employee discontent?
If yes, what can we do to minimize that?
65. 70
Questions?
• For more information, contact:
Barbara J. Zabawa, JD, MPH
The Center for Health Law Equity, LLC
Phone: 608-579-1267
Email: bzabawa@cfhle.com