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EEOC proposes changes to wellness rules

Discounts in exchange for health information


The U.S. Equal Employment Opportunity Commission's proposal to revise genetic nondiscrimination rules has given employers some answers about giving incentives to employees and their spouses for participating in voluntary workplace wellness programs.

However, experts say the proposed changes also show how much work remains for the EEOC to reconcile wellness program rules with other federal laws.

“We have a ways to go yet before there are definitive (nondiscrimination) guidelines for wellness programs,” said Philip Voluck, a managing partner at law firm Kaufman Dolowich & Voluck L.L.P. in New York.

The EEOC's Oct. 29 proposal, on which it is accepting comments until Dec. 29, would amend Title II of the Genetic Information Nondiscrimination Act to permit rewards or penalties worth up to 30% of the total cost of group health plans for employees and covered spouses who participate in voluntary wellness programs that collect information about their health status.

Experts say these changes under GINA, taken together with nondiscrimination rule changes proposed in April under the Americans with Disabilities Act, should indicate the EEOC's willingness to compromise with employers.

“We've seen the scale shift a bit in the balance of these two competing interests of (protecting against discrimination and making employees healthier),” said Ricki Roer, a New York-based partner at Wilson Elser Moskowitz Edelman & Dicker L.L.P. “The EEOC is indicating in these rule changes that it doesn't want to be an impediment to wellness programs.”

Under existing Title II regulations, employers cannot require employees to provide their genetic information to receive wellness program incentives.

Current Title II regulations also implicitly prohibit using incentives offered to employees' spouses in exchange for their current or past health information, in conflict with regulations under Title I of GINA.

At the least, experts said, the proposed changes represent some measure of “welcome guidance for employers who sponsor wellness programs in navigating GINA, which is somewhat of a minefield when it comes to receiving medical information,” said Laura Fant, labor and employment associate at Proskauer Rose L.L.P. and co-head of the firm’s Disability, Accommodations & Leave Management Group in New York.

If implemented, the changes would cap the dollar value of incentives offered at 30% of the total cost of group health coverage for a family or, if only the employee is covered, 30% of self-only coverage.

The EEOC was very clear that the change would not apply to medical histories and other protected genetic information of employees' children, citing the higher possibility of discrimination against employees.

“I was nervous waiting for the proposed regulations, but am pleased with the direction the EEOC is taking,” Gretchen Young, senior vice president of health policy at the nonprofit ERISA Industry Committee in Washington, said in a statement.

“While it does seem that employers should unquestionably be permitted to incentivize spouses to achieve better health, the EEOC lawsuits last fall gave us significant cause for concern,” Ms. Young said, referring to ongoing EEOC legal action against two Wisconsin employers over imposing penalties for not participating in their wellness programs.

Experts said the separate dollar value limits on incentives offered to families and single employees in the proposed GINA rule changes could indicate a key concession by the EEOC on its proposed revision of wellness rules under the ADA, which would have capped virtually all wellness incentives at 30% of the cost of self-only coverage.

“That was one of the big points we made in our public comments on the proposed ADA changes,” said Steve Wojcik, vice president of public policy at the National Business Group on Health in Washington. “I think this is a pretty strong signal that they're going to change it in the final rule.”

But experts say more clarification is needed on several issues.

Specifically, the agency has asked for public guidance on opt-out alternatives, data collection procedures and privacy safeguards on wellness programs that permit participation without being enrolled in a company health plan.

“Other than the clarifications regarding spouses and determining the limitation on incentives, I think it actually injects even more confusion into this whole issue,” Mr. Voluck said.