It Might Be Time to Rethink Your Employee Wellness Incentives

Are you certain your employee wellness program is compliant with federal law?

After the leadership changes at the Equal Employment Opportunity Commission (EEOC) this month, the proposed rules limiting incentives for voluntary participation in employer wellness plans have been suspended—indefinitely.

New proposed rules could be announced within weeks or months, or maybe even years (it took the EEOC nearly two years to propose these rules after removing the incentive provisions in January 2019).

In the absence of new rules, with an agency position of no safe harbor and a change in enforcement priorities, employers are rightly asking themselves:

Am I compliant with current regulations?

The short answer: If you are compliant with all the existing provisions of the conflicting laws, yes. What would that look like?

An incentivized wellness program that doesn’t require employees to disclose medical information and doesn’t impose a penalty for non-participation.
A voluntary wellness program wherein employees can choose to disclose medical information to participate but are neither incentivized nor penalized based on participation.

If, however, your wellness program:

Requires participants to provide medical information (e.g., health risk assessments, preventive health screenings, etc.) and
Relies heavily on premium differentials or levies penalties to incentivize employees to participate …

Your program is not likely compliant with current antidiscrimination laws and is unlikely to be made compliant with any new proposed rules.

The proposed rule (now suspended) limiting incentives to an inconsequential value, thus ensuring that participation in programs is truly “voluntary,” is likely to be upheld, as any larger value would be repeatedly challenged in court.

The proposed (now suspended) safe harbor exception for wellness programs offered under a group health plan, however, remains in question given the EEOC’s former stance that the ADA provision didn’t apply to wellness programs. It’s possible the suspended rule could be upheld in a new proposal, but it might be altered in some fashion to offer additional protection to workers.

What Should I Do Now?

While the EEOC seems to have tipped its hand with the (now suspended) proposed rules, predictions about future rules are speculation at this point. Regardless of any future proposed rules or guidance, you should ensure that your current wellness program is compliant with existing laws and regulations.

McClone clients are encouraged to reach out for help evaluating current wellness programs. Our in-house compliance attorney and our population health advisor will review your program and advise on necessary changes for compliance. We can also offer a variety of alternative program options that are designed to remain compliant regardless of any rule changes.

Not currently a McClone client? Now is a great time to meet with our team and learn about all the value-add benefits and services (like consulting an attorney and special advisor) available to McClone clients. Contact us today!