Now that the Equal Employment Opportunity Commission (EEOC) has issued final regulations for wellness programs under both the Americans with Disabilities Act (ADA) and the Genetic Information and Nondiscrimination Act (GINA), and has issued a sample employee notice to assist in complying with the ADA regulations, wellness plan sponsors must attend to the task of designing programs that promote a desired level of wellness within their organizations, and that comply with the final ADA/GINA regulations and existing regulations under the Health Insurance Portability and Accountability Act (HIPAA). Because the EEOC’s new final regulations are based on different laws and are not aligned with the HIPAA regulations, they create a new level of compliance. A wellness program design must navigate the regulatory maze of the most restrictive limitation of each of the three laws.
Wellness programs come in various shapes and sizes and the design of your program will determine which laws apply. As a result, the first step in reviewing your wellness program is to identify the laws and the provisions of the laws that apply. For example, if your program is not part of a group health plan, then it is not subject to HIPAA requirements but it will likely be subject to some or all of the ADA/GINA requirements. (Part 1 of the Wellness Program Review Chart found at this link can assist you in identifying the applicable laws and provisions.) The Chart provides a description of basic wellness program characteristics and identifies applicable laws and includes consideration of the application of the Internal Revenue Code for taxation of rewards.
The next step is to identify the most restrictive limitation of the applicable laws. In general, the HIPAA rules and the ADA/GINA rules regulate similar areas. Accordingly, you can review the rules for each area to determine which is the most restrictive. Areas include reward limitations, confidentiality requirements, disclosure requirements and reasonable alternative/reasonable accommodation requirements. For example, if your wellness program includes a component to prevent or reduce tobacco use by an employee, the maximum reward under HIPAA is 50% of the total cost of the employee-only coverage under the benefit package in which the employee is enrolled. However, the ADA permits a maximum reward of only 30% of the total cost of employee-only coverage if a medical test is used to determine tobacco usage but if no medical test is used (i.e., the employee is merely asked whether he or she uses tobacco), then the ADA does not apply and the 50% HIPAA limit controls. There are additional rules if a spouse may participate in the tobacco component. Part 2 of the Wellness Program Review Change can assist you in identifying the most restrictive limitation for several areas.
Further, effective for rewards earned after January 1, 2017, the ADA/GINA regulations impose a “notice” requirement for employees and an “authorization” requirement for spouses. If your wellness program includes a reward or penalty for an employee to answer a disability-related inquiry or undergo a medical examination, then a “notice” that complies with the requirements of the ADA regulations must be given to the employee. If the program includes a reward or penalty for a spouse to provide information about his or her diseases or disorders, then the spouse must provide a prior written “authorization” that complies with the GINA regulations. Although the EEOC has provided a sample employee “notice.” (Notice is available by clicking here.) note that it may contain statements inappropriate for your wellness program and, if so, should be modified.
While the EEOC may have sought to align the rules under the ADA and GINA with HIPAA, its rules to maintain the goals of the ADA and GINA add significant complexity. Employers that offer wellness programs must carefully navigate the maze of regulations.