Is your wellness program in compliance with the EEOC's final rule?
The EEOC issued its final wellness ruling earlier this year for wellness programs in the workplace. Here is a breakdown of the biggest takeaways of the EEOC's final wellness rule.
1. The rule ONLY applies to wellness programs that require employees to answer questions regarding disability, or to complete medical exams in order to earn a reward or avoid a penalty.
2. The rule applies to these ^ types of wellness programs whether or not they are part of the employer’s group health plan
3. The rule largely clarifies the meaning of the terms “voluntary” and “incentives” as they relate to wellness programs—
Voluntary: 5 New things
An employer may not require any employee to participate
An employer may not deny any employee who does not participate in a wellness program access to health coverage or prohibit any employee from choosing a particular plan
An employer may not take any other adverse action or retaliate against, interfere with, coerce, intimidate, or threaten any employee who chooses not to participate in a wellness program or fails to achieve certain health outcomes
An employer must provide a notice that clearly explains what medical information will be obtained, how it will be used, who will receive it, and the restrictions on disclosure
An employer must comply with the incentive limits
Incentives: 3 New Things
For a wellness program open only to employees enrolled in a particular plan, the maximum allowable incentive an employer can offer is 30 percent of the total cost for self-only coverage of the plan in which the employee is enrolled.
For a wellness program open to all employees regardless of whether they are enrolled in a plan, the employer may offer a maximum incentive of 30 percent of the lowest cost major medical self-only plan it offers.
If an employer does not offer health insurance, they still have the option to offer incentives to employees to participate in a wellness program
4. The rule also requires that an employee health program be “reasonably designed,” meaning the program cannot:
Require an overly burdensome amount of time for participation
Involve unreasonably intrusive procedures
Be a subterfuge for violating the ADA or other laws prohibiting employment discrimination
Require employees to incur significant costs for medical examinations
5. Employer wellness programs must comply with this rule as of the first day of the first plan year that begins on or after January 1, 2017 i.e. if the plan you are basing incentives off of begins March 1, 2017 the rule will apply on this date.
Note: Employers must provide a notice about employee’s medical information they will obtain for the Wellness program. You can find a sample notice issued by the EEOC here !
Still have questions about compliance with the final wellness rule? Reach out to us! Our in-house compliance experts are ready to help.