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Honeywell latest firm to draw EEOC scrutiny over wellness program penalties

Honeywell latest firm to draw EEOC scrutiny over wellness program penalties

Honeywell International Inc. on Wednesday called the U.S. Equal Employment Opportunity Commission's recent lawsuit against the company over plans to penalize workers who refuse to participate in its workplace wellness program “frivolous” and “out of step.”

The Morristown, N.J.-based multinational company informed employees at its facilities in Minnesota earlier this year that non-participation in wellness-related biometric screenings would result in a $500 annual surcharge on their 2015 health insurance premiums, the EEOC claims in a lawsuit filed Monday in a Minneapolis federal District Court.

The lawsuit claims Honeywell also planned to withhold contributions to employees' tax-preferred health savings accounts worth up to $1,500 annually and assess an additional $1,000 tobacco surcharge against employees who refused to submit to the wellness screenings, which include tests for their blood pressure, glucose, cholesterol and body mass.

Similar penalties would also be assessed against employees' spouses enrolled in Honeywell's group health insurance plan if they refused to participate in the biometric tests, the EEOC said in its lawsuit.

The agency's lawsuit accuses Honeywell of violating both the federal Americans with Disabilities Act and the Genetic Information Nondiscrimination Act by effectively forcing employees and their spouses to submit to the health screenings, and seeks a temporary restraining order and preliminary injunction barring the company from implementing the penalties.

In a statement released on Wednesday, Honeywell said the wellness incentives attached to the biometric screening program comply with provisions of both the Health Insurance Portability and Accountability Act and the Patient Protection and Affordable Care Act, “which were designed by Congress to encourage healthier lifestyles while helping to control healthcare costs.”

“(The EEOC) is unfamiliar with the details of our wellness programs and woefully out of step with the healthcare marketplace and with the core intent of the Affordable Care Act to provide expanded access and improved healthcare to all Americans,” the company said in its statement. “No Honeywell employee has ever been denied healthcare coverage or disciplined in any way as a result of their voluntary decision not to participate in our wellness programs.”

Honeywell added in its statement that its intent was to reward employees who do participate in the screenings by lowering their monthly premiums.

“For employees with single coverage who voluntarily decide to take a biometric screening, their monthly premiums will be $125 lower than the employees who decide not to take a biometric screening,” the company's statement said. “Biometric results are strictly confidential and not shared with the Company.”

The lawsuit against Honeywell is the third such action taken by the EEOC this year targeting employers whose workplace wellness programs exceed the agency's informal threshold of voluntary participation on the part of individual employees. Similar federal lawsuits were recently filed against a pair of Wisconsin-based employers, Orion Energy Systems Inc. and Flambeau Inc.

Reacting to the news of the EEOC's lawsuit against Honeywell on Wednesday, employer advocacy groups criticized the agency for taking legal action against employers without first issuing formal guidance on its treatment of incentivized workplace wellness programs under the federal nondiscrimination statutes it enforces, including the ADA and GINA.

“Employers have been seeking guidance for years from the EEOC regarding how the ADA and GINA apply to wellness programs, and it has failed to provide that guidance,” Brian Marcotte, president and CEO of the Washington D.C.-based National Business Group on Health, said in an interview with Business Insurance. “Now they're coming out with legal action that basically conflicts with both the Affordable Care Act and HIPAA.”

Gretchen Young, senior vice president for health policy at the Washington, D.C.-based ERISA Industry Committee, said in a statement that the EEOC appeared to be playing by “a different set of rules, with no forewarning to companies whatsoever.”

“Even though large American companies have invested a huge amount of time, money, and manpower into making sure that their wellness programs comply with the ACA, now here comes the EEOC out of left field with a whole new set of rules and regulations to impose on these programs,” Ms. Young said.

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