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Benefit experts are welcoming long-awaited final U.S. Equal Employment Opportunity Commission rules that end years of uncertainty on the incentives employers can offer employees and their spouses to participate in voluntary group wellness programs.
“Employers can move forward with confidence in implementing a well-designed wellness program with greater harmony across the various applicable laws,” said Cathy Kenworthy, president and CEO of Interactive Health Inc. in Chicago.
“We now have closure. This is something employers have been asking for for a long time,” added Tami Simon, global practice leader with Xerox HR Services in Washington.
The final rules, which were issued Monday and closely follow earlier EEOC proposals, make clear how two federal laws — the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act — apply to group wellness programs that ask employees and spouses for health information.
For example, the final rules make clear that voluntary wellness programs in which participants undergo medical examinations or that require participants to answer questions about their health can provide incentives of up to 30% of the premium cost of self-only coverage. In addition, the maximum incentive that can be provided to an employee's spouse is 30% of employee self-only coverage. No incentives can be offered for wellness programs involving employees' children.
In the case of an employer that offers just one group plan in which the cost of self-only coverage is $6,000, an employer could give the employees up to $1,800 for participating in the wellness program.
If an employer offers employees a choice of several health care plans, the maximum wellness participation incentive would be capped at 30% of the premium for self-only coverage in its lowest-cost plan, the EEOC said.
“For example, if an employer offers three different major medical group plans ranging in cost for self-only coverage from $5,000 to $8,000 and wants to offer an incentive to employees for participating in a wellness program and completing an HRA (health risk assessment), the employer could offer a maximum incentive of $1,500, 30% of its lowest cost plan,” the EEOC said in guidance accompanying the regulations.
On the other hand, the final rules make clear that the use of “gated” plans will not pass muster. Under a gated design, only those employees who participate in biometric screenings or complete health risk assessments can enroll in an employer's most generous health care plans.
“We were disappointed that the EEOC didn't provide more flexibility around gated benefit plan designs in which completing a health assessment or biometric screening are a condition for eligibility for a richer benefit plan, otherwise employees are enrolled in the default plan,” said Steve Wojcik, vice president of public policy at the National Business Group on Health in Washington.
Others, though, welcome the fact that the EEOC didn't adopt some earlier proposals.
“We dodged a number of bullets. There were proposals for even stricter confidentiality requirements, even more notices and paperwork, more consent collections and even a requirement that employers accept a doctor's note in lieu of the employee or spouse actually participating in the wellness program or doing the health risk assessment. So we welcome that these things were not included,” said James Gelfand, senior vice president of health policy at the ERISA Industry Committee in Washington.
In fact, “on balance, the final EEOC guidelines are a positive step. The guidelines are very reflective of what we see as best practices that we advocate with our clients. We see very little, if any, changes our clients will need to make,” Interactive Health's Ms. Kenworthy said.
Marsh & McLennan Agency L.L.C. on Thursday said it has added new wellness promotion and engagement tools to its MarketLink Benefits Administration & Private Exchange.