The Equal Employment Opportunity Commission (EEOC) has allowed the Final Rule on Employer Wellness Programs and Title I of the Americans with Disabilities Act, to proceed as planned, following legal challenges by the AARP. Effectively, the rule allows employers that sponsor qualifying wellness programs to increase the cost for employee only coverage up to 30% if an employee chooses not to participate in the wellness program.
In October 2016, AARP requested that the U.S. District Court for the District of Columbia block the rule arguing that the higher premiums incurred by their members (who failed to participate in employer sponsored wellness program) would cause irreparable harm. The court disagreed and found that while the implementation of the rule may cause some economic harm, it was not irreparable harm.
Employers who already implemented wellness programs under the new rule welcomed the court’s decision and now have additional confidence, following reaffirmed support by the EEOC.
Implementing wellness programs that impose financial penalties has been challenging due to sometimes conflicting provisions of the Affordable Care Act (ACA), Americans with Disabilities Act (ADA), Genetic Information Nondiscrimination Act (GINA) and the Health Insurance Portability and Accountability Act (HIPAA). Although the new EEOC guidance provided some clarification, challenges remain. Employers should carefully consider the compliance implications prior to implementation.
For more information on the EEOC Final Rule click here.