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Proposed EEOC Regulations and Other Guidance on Employer Wellness Programs; Additional Wellness Guidance in FAQs Addressing ACA Implementation and HIPAA Privacy

Amendments to Regulations Under the American With Disabilities Act, 29 CFR Part 1630, 80 Fed. Reg. __ (Apr. 20, 2015); Questions and Answers about EEOC’s Notice of Proposed Rulemaking on Employer Wellness Programs; FAQs About Affordable Care Act Implementation (Part XXV) (Apr. 16, 2015); HIPAA Privacy and Security and Workplace Wellness Programs FAQs

Proposed Regulations




News Release

Visit the Health Care Reform Community on Checkpoint to join the discussion on this development (for Checkpoint subscribers to EBIA’s Health Care Reform manual).

As we went to press this week, the EEOC released long-awaited guidance explaining how employer wellness programs may satisfy the ADA rule permitting disability-related inquiries and medical examinations by voluntary employee health programs. Other agencies also released guidance related to wellness programs, including FAQs on health-contingent welfare program requirements and application of the HIPAA privacy rules to workplace wellness programs. We will cover the proposed regulations and other guidance in more detail in next week’s EBIA Weekly. In the meantime, here are some highlights:

  • Maximum Allowable Incentive. Under the proposed regulations, the maximum allowable incentive an employer could offer (whether as a reward or a penalty) would be 30% of the total cost of employee-only coverage, the same as the limit under HIPAA for non-tobacco incentives under health-contingent wellness programs. However, the proposed EEOC regulations would apply the same limit to participatory programs, and the higher tobacco-related incentives permitted under HIPAA would not be allowed unless the ADA did not apply because the program did not include a disability-related inquiry or medical examination (e.g., if employees were only asked about their tobacco use as opposed to being tested for nicotine in their blood).
  • Notice Requirements. Employers offering their wellness program as part of a group health plan would have to provide a notice that clearly explains what medical information will be obtained, who will receive the medical information, how the medical information will be used, the restrictions on its disclosure, and the methods that will be used to prevent its improper disclosure.
  • Confidentiality Requirements. The proposed regulations would include additional requirements for employer sponsors and wellness-program providers to protect the confidentiality of information collected by a wellness program.
  • Reasonable Design. Under the proposed regulations, a wellness program could not qualify for the voluntary plans exception unless it was reasonably designed to promote health or prevent disease and not overly burdensome, among other requirements.

EBIA Comment: These proposed regulations break the EEOC’s long silence on the effect of wellness incentives under the ADA, and indicate the EEOC’s intent to provide as much consistency as possible with the HIPAA rules. The EEOC Q&As explain that employers do not have to comply with the proposed rules, but indicate that it is unlikely that the EEOC or a court would conclude that an employer violated the ADA if it complied with the rules before final regulations are issued. In addition to our article next week with more information on how to comply, you may be interested in our May 28, 2015 web seminar on wellness programs and the implication of these proposed rules—watch for more details in next week’s article.

Contributing Editors: EBIA Staff.

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