The days of referring to the EEOC’s guidance on wellness incentives under the ADA and GINA as “long-awaited” may be coming to an end. The EEOC announced that it has sent a Notice of Proposed Rulemaking (NPRM) on this issue to the Office of Management and Budget (OMB) for clearance.
The NPRM is not available for publication. A primary issue is the extent to which an employer can offer financial incentives to employees, their spouses and their dependents to participate in an employer’s wellness initiatives without running afoul of the ADA and GINA. The EEOC’s perspective on allowable incentives got much attention recently when it sought to enjoin an employer from implementing its incentive program, which the employer contended complied with the wellness incentive rules in the Affordable Care Act (ACA). In that litigation, the EEOC declined to define the line between lawful and unlawful financial incentives but argued that the employer’s incentives were so large that participation in that program was not voluntary. The court denied the injunction.
In an apparent response to that litigation, in March 2015, a group of Republican Senators and Representatives introduced the Preserving Employee Wellness Programs Act (H.R. 1189 and S. 620) to harmonize the wellness program provisions in the ACA with potentially conflicting provisions in the ADA and GINA. Under those bills, a wellness program with incentives that comply with the ACA would be protected from attack under the ADA and GINA.
The EEOC’s NPRM may propose consistency with the ACA. The Kiplinger Letter (subscription service) reports that under the EEOC’s guidelines, “[f]or example, employers can discount health insurance premiums by up to 30% for employees who make lifestyle changes: Quitting cigarettes, exercising regularly, etc. Yet-to-be-defined steps will aim to prevent discrimination against disabled workers.”
After OMB approves the NPRM, the proposed rule will be published in the Federal Register for a 60-day public notice and comment period. For additional information on this issue, click here.