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From The Trust Perspective: Employer-Sponsored Wellness Programs Must Meet ADA Requirements 

By Bob Haynes, NCLM Associate Director, Risk Management Services

As premiums for medical insurance for our employees and their families continue to rise, employers understand that one of their basic tools to curb these increases is to improve the health of their employees through wellness programs. As the health of employees improves, claims are reduced and premium increases are moderated. Wellness programs have evolved over the years from conducting a wellness fair and inviting employees to a lunch-and-learn to programs that provide incentives for employees to participate, assess health status and set goals for improvement. The more advanced programs, however, can trigger questions of whether they comply with the Americans with Disabilities Act (ADA), with a rule recently issued regarding employer wellness programs. The ADA prohibits discrimination against individuals with disabilities, and applies to employers with 15 or more employees.

The ADA rule applies to employer wellness programs that ask employees about their medical conditions or that ask employees to take medical examinations (such as tests to detect high blood pressure, high cholesterol or diabetes). Employers must ensure that these programs are reasonably designed to promote health and prevent disease, be voluntary, and keep employee medical information confidential. The rule allows for limited financial and other incentives as part of voluntary wellness programs under the rule. However, employers may not require employees to participate in a wellness program; may not deny or limit their health coverage for non-participation; may not retaliate against or interfere with any employee who does not want to participate; and may not coerce, threaten, intimidate or harass anyone into participating. Employees also must receive a notice describing what information will be collected as part of the wellness program, who will receive it, how it will be used, and how it will be kept confidential.

A few details regarding the notice:

  • The obligation to provide the notice goes into effect on the first day of the plan year that begins on or after January 1, 2017 for the plan that the employer uses to calculate the incentive limit.
  • Employees must receive it before providing any health information and with enough time to decide whether to participate in the wellness program.
  • While an employee’s signed authorization is not required to comply with the ADA rules, it may be required to comply with the Health Insurance Portability and Accountability Act (HIPAA) and the Genetic Information Nondiscrimination Act (GINA). It may be advisable to collect a signed copy from wellness program participants to have a record acknowledging their receipt of the notice, even though it is not required under ADA rules.

In a press release dated June 16, 2016, the Equal Employment Opportunity Commission (EEOC) posted a sample notice that each employee must receive. This notice can be accessed on the EEOC website at https://www.eeoc.gov/laws/regulations/ada-wellness-notice.cfm. Questions and answers regarding the notice can be accessed at https://www.eeoc.gov/laws/regulations/qanda-ada-wellness-notice.cfm. Items addressed in the Q&As include:

  • Who must provide the notice.
  • When employees should get the notice.
  • The format in which the notice should be provided.
  • What information must be provided to spouses.
  • Whether an employee’s signed authorization is required as part of the notice requirement.
  • Whether the current notice required under HIPAA satisfies the new notice requirement under the ADA.

We certainly encourage employer wellness programs that reward individuals for both participating and reaching their wellness goals. Financial incentives go a long way to ramping up participation. However, these programs require proper design to ensure employees are not discriminated against, health information remains confidential, and regulatory requirements are met.