Late last week, the EEOC released the proposed rules on wellness programs for employers. These long-awaited proposed rules will likely be adopted in full by this summer, after the public has 60 days to submit comments.
It’s still early to give a full recap of the rules, particularly because they might change. Various blogs have been summarizing some of the key points thus far.
- The proposed rule clarifies that the ADA allows employers to offer incentives up to 30% of the cost of employee-only coverage to employees who participate in a wellness program and/or for achieving health outcomes.
- The rule also allows employers to impose penalties on employees who do not participate or achieve certain health outcomes. The maximum allowable penalty an employer can impose on employees is 30% of the total cost of employee-only coverage.
Several months ago, the EEOC announced its intend to issue regulations interpreting whether employer wellness plans are legal or illegal medical exams under the ADA. Thankfully, last Thursday the EEOC published its proposed regulations, and its good news for employers who use these programs to keep down the cost of their group health insurance.
Eric Meyer notes several other takeaways including that no discrimination is allowed by employers:
- No discrimination allowed. That means, employers may not interfere with an employee’s ADA rights, or threaten, intimidate, or coerce an employee for refusing to participate in a wellness program or for failing to achieve certain health outcomes.
- Volunteers only. Employers cannot require employees to participate, or discipline or deny health coverage to employees who do not participate.
A Law360 article this morning notes, however, that there are still some open questions and issues from the proposed guidance:
- Will ‘Employee-Only Coverage’ Language Stay?
- Will the Courts and EEOC See Eye-to-Eye On Whether Employers to Use the ADA’s “Safe Harbor” Provisions?
- What Will Happen with Wellness Programs When Considered Under Upcoming Regulations Under GINA?
For employers, the proposed rules are not the end of the discussion on wellness programs, just another step down the road. But if your company utilizes them, this is one area worth watching for developments this year.