On May 17, 2016, the U.S. Equal Employment Opportunity Commission (EEOC) issued long-awaited final rules on the applicability of the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA) to employer-sponsored wellness programs. The regulations take effect on the first day of the first plan year that begins on or after January 1, 2017.

Before the EEOC issued these regulations, employers had been uncertain about whether, and to what extent, offering inducements for employees to participate in wellness programs would comply with the ADA. The EEOC’s public statements had led employers to believe that anything more than a nominal inducement for participation might render a wellness program involuntary (and would violate the ADA) — a position that would have been inconsistent with the existing regulations under the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Affordable Care Act (ACA), which govern wellness programs offered through group health plans. With the final rules, the EEOC tried to harmonize, to some extent, its new regulations with the HIPAA/ACA regulations. Notably, the EEOC’s ADA regulations authorize employers to offer an inducement of up to 30 percent of the total cost of self-only coverage for an employee’s participation in a wellness program. (The HIPAA/ACA regulations permit an inducement of up to 30 percent of the total cost of coverage in which an employee is enrolled and an inducement of up to 50 percent for tobacco-cessation programs.) The regulations also explain how the total cost of self-only coverage is calculated based on whether the employer offers one or more health plans and whether the employee participates in the employer’s plan.

The ADA regulations also impose requirements to ensure that wellness programs are voluntary. For example, employers may not require that employees participate and may not deny to employees who choose not to participate access to health care coverage generally or to a particular health plan.

The EEOC regulations under GINA address another issue that had employers concerned. In past statements, the EEOC had suggested that offering an inducement for spouses to participate in a wellness program might violate GINA (on the theory that a spouse’s medical information constitutes family medical history or genetic information of the employee, and GINA prohibits offering an inducement for genetic information). The new GINA regulations (like the new ADA regulations) make clear, however, that employers may provide an inducement of up to 30 percent of the total cost of self-only coverage for spouses to participate in an employee wellness program, in addition to the same level of inducement for the employee’s own participation in a wellness program. Employers are not permitted to offer an inducement for genetic information of the employee’s children.

While approving the use of inducements to participate in wellness programs, the regulations also include some new burdens for employers. For example, the ADA regulations require that employers provide a notice to employees that explains what medical information their employer will obtain, how it will use that information, and what restrictions exist on the disclosure of that information. The EEOC plans to publish a sample notice on its website.

The new regulations provide some comfort to employers, who may now rely on defined parameters for designing wellness programs. Before the new regulations go into effect next year, employers should review their existing wellness programs to ensure that they are compliant both with the new ADA and GINA regulations and with existing regulations under HIPAA/ACA.