Hunton Profile

Administrative Law Task Force

The Administrative Task Force plays a critical role in keeping our OSHA practice current and vibrant.  We follow developments daily and we work together to analyze the impact that proposed and actual changes will have on the law in general and specifically on our client’s industries. Employers today face an unprecedented range of workplace safety and OSHA legal issues as government increases worker safety and health regulation and demands meticulous reviews by its OSHA inspection force.

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The EEOC And Wellness Programs

As the 2013 open enrollment season approaches, group health plan sponsors are trying to hold down health care costs.  Implementing a wellness program may be part of that effort.  The difficulty lies in designing a program that promotes wellness without running afoul of the Equal Employment Opportunity Commission (EEOC).

Why the EEOC?  Because the EEOC is responsible for enforcing the  disability discrimination in employment rules under Title I of the Americans with Disabilities Act (ADA).  The ADA prohibits medical examinations and disability-related inquiries unless they are shown to be job-related and consistent with business necessity.  The ADA provides an exception for “voluntary medical examinations, including medical histories, which are part of an employee health program” provided the information collected is kept confidential and separate from personnel records.  See Q&A 22 of EEOC Notice No. 915.002 released July  17, 2000.  Unfortunately, the EEOC has taken the position that the required completion of a health risk assessment (HRA) or biometric screening renders participation involuntary.  In addition, despite the long-standing wellness rules under the Health Insurance Portability and Accountability Act of 1996, as amended (HIPAA), the agency also has yet to take a position as to whether, and to what extent, financial incentives would be permissible under the ADA.

It is important to keep in mind, though, that the ADA also includes an exception to the prohibition on medical examinations and inquiries for "bona fide benefit plans."  This exception provides that the ADA should not be construed to prohibit or restrict an employer from “establishing, sponsoring, observing, or administering the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with State law.”  Although the EEOC has not published guidance on this provision, at least one federal district court has held that a group health plan’s requirement that participants complete a HRA and medical screening or pay a surcharge is permissible under the ADA safe harbor for bona fide benefit plans. Seff v. Broward County, 778 F.Supp. 2d 1370 (S.D. Fla. 2011).  The Broward County decision has been appealed to the U.S. Eleventh Circuit Court of Appeals, which has yet to rule in the case.

Of course, the ADA is not the only gauntlet to be run when designing a wellness program.  There are the non-discrimination requirements of the HIPAA as well as the Genetic Information Nondiscrimination Act of 2008 (GINA).  See 29 CFR § 2590.702(b) and 29 CFR § 2590.702-1(b) and (d).

Many wellness programs include HRAs and biometric screenings.  The goal is to have as many employees as possible participate.  To that end, many programs include either incentives to participate (a financial reward) or a penalty for failure to participate (higher premiums or no group health insurance).  A wellness program with incentives and/or penalties may be found to be involuntary (and therefore discriminatory) by the EEOC even though the program otherwise satisfies both HIPAA and GINA.  In the absence of guidance from the EEOC on the bona fide benefit plans safe harbor or a higher court ruling, employers relying on the safe harbor to add mandatory HRAs or biometric screenings to their group health wellness programs could face agency investigation or litigation challenges to such programs. 
 
We encourage plan sponsors to become familiar with the HIPAA, GINA and EEOC rules governing wellness programs and carefully consider how such rules affect their health and wellness initiatives.