Trends in Workplace Wellness Programs and Evolving Federal Standards

Timeline of Federal Policy Related to Wellness Programs
July 1990 Americans With Disabilities Act (ADA) enacted. Prohibits employment discrimination based on disability and prohibits employers from making any medical inquiries of/about employees with few exceptions, including through “voluntary” wellness programs.

EEOC enforcement guidance states that “voluntary” means that the employer neither requires participation in the program, nor penalizes employees who do not participate.

1996 Health Insurance Portability and Accountability Act (HIPAA) enacted.

Prohibits group health plans from conditioning eligibility or premium contribution for group health benefits on health status (nondiscrimination). Wellness exception permits premium discounts or rebates or modification of otherwise applicable cost sharing in return for adherence to programs of health promotion and disease prevention

1997 Clinton Administration final HIPAA regulation clarifies that wellness program incentives cannot vary premiums or cost sharing based on achieving a health status-related factor.
Dec 2006 Bush Administration final nondiscrimination and wellness regulation reinterprets wellness exception to permit health-outcomes-based incentives that vary premium and cost sharing based on a health status-related factor. Health-outcomes based wellness programs are allowed if the financial incentive does not exceed 20% of the health plan cost (employer + employee share), and if the wellness program is reasonably designed and offered to all similarly situated individuals. Other “participatory” wellness programs that do not vary premiums or cost sharing based on health status factors are not subject to this standard. The regulation specifies that wellness program compliance with these standards Compliance with this section is not determinative of compliance with any other State or Federal law, such as the Americans with Disabilities Act.
May 2008 Genetic Information Nondiscrimination Act (GINA) enacted. Prohibits discrimination in health insurance and in employment based on genetic information, defined to include results of a genetic test and information about family history. Health insurers, plans, and employers are also prohibited from requesting or requiring genetic information of an individual or an individual’s family members, with limited exceptions, including voluntary wellness programs.
Mar 2010 Affordable Care Act (ACA) enacted. Codifies 2006 regulatory standards for health-outcomes based wellness programs and increases permissible financial incentives to 30% of total health plan cost, or up to 50% if tobacco cessation incentives are included.
Nov 2010 EEOC final rule on GINA clarifies that wellness programs may not offer a financial incentive for completion of a health risk assessment that includes questions about family medical history or other genetic information.
Jun 2013 Obama Administration final rule on ACA wellness standards. Specifies that workplace wellness program compliance with these standards is not determinative of compliance with any other State or Federal law, including the ADA.
May 2016 EEOC final rule to amend ADA and GINA regulations and enforcement guidance with respect to workplace wellness programs that collect personal health information. Voluntary programs can use incentives, up to 30% of cost of self-only coverage, to encourage participation. Reasonably designed programs that collect health information must meet other standards relating to permitted uses of collected health information, prior notice to employees, and health data privacy protections
Aug 2017 In response to AARP challenge, Federal court finds 2016 rule is arbitrary and capricious because EEOC did not provide sufficient reasoning to justify the incentive limit for workplace wellness programs. The court later issued an order vacating the incentive portion of the rule, effective 1/1/2019.
Dec 2018 EEOC repeals portions of ADA and GINA wellness rules permitting financial incentives. Other portions establishing standards relating to permitted uses of health information, notice to employees, and privacy remain in force.
Spring 2019 EEOC includes revisions to ADA and GINA wellness rules on the agency’s regulatory agenda for 2019.
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