EEOC Regulations for Corporate Wellness Plans

Written by benefitexpress | June 22, 2016

When the EEOC released new regulations regarding wellness programs on May 17th, many employers were confused. The rules were aimed at providing more clear definitions for bringing corporate wellness programs into compliance with the Americans with Disabilities Act. Title I of the ADA prevents employers from discriminating against individuals due to a disability and requires employers to make reasonable accommodations for employees with disabilities.

Under the new guidelines, employers must provide reasonable accommodations for employees with disabilities to participate in wellness programs. This could include hiring a sign language interpreter for weight loss/smoking cessation courses or providing literature for the program in large print and braille. The EEOC regulations also worked to bring wellness programs into alignment with other federal regulations under ACA, GINA, and HIPAA.

With the EEOC’s regulations, employers are allowed to make inquiries or conduct medical exams as part of a voluntary health screening. The May regulations were aimed at specifically defining what constitutes ‘voluntary’. For example, a “voluntary” health program which had very high financial incentives could be considered coercive; not participating could constitute a considerable loss for an employee. If a “voluntary” program had a coercive level of compensation and required a health screening, it could be considered forcing employees to disclose private health information to employers.

Within the regulations, an employer’s incentive for participating in a program may not exceed 30% of the total cost of self-only health insurance. If the employer offers multiple insurance plans, they must use the lowest cost plan. If the employer does not offer health insurance, they must base their incentive on what a 40-year-old non-smoker would pay for self-only coverage under the second lowest cost Silver Plan on the state or federal health care exchange in the employer’s primary location. This applies only to wellness programs which make inquiries regarding health and disability status as part of the program. For programs that do not include health and disability related inquiries, an employer may offer up to 50% of the cost of self-only insurance.

In addition, employers must provide a notice stating how the information collected will be used. The content of this notice was one of the larger concerns when the final ruling was released. In response, on June 17th, the EEOC released a sample notice that may be used as a template. The deadline for compliance is January 1st, 2017.

Have more questions about wellness programs? Register for our upcoming Wellness Plans webinar or you can also learn about benefitexpress' wellness solution.

Topics: Legislative Update, Health & Wellness