Benefits and Compensation

More Wellness Program Regulations—Be ACA Compliant

In yesterday’s Advisor, we discussed wellness programs under the Affordable Care Act (ACA) and implications for employers; today, what you need to know regarding mandatory participation in wellness programs, along with other regulations under the ACA.

The Equal Employment Opportunity Commission (EEOC) maintains that participation in wellness programs should be voluntary, since requiring participation could be construed as discriminatory. Mandatory participation requirements could also force employees to submit to nonwork-related health screenings and to divulge genetic information in some cases (which could violate other laws). However, the ACA does not clarify the point of whether participation can be mandated. Employers should be aware that the EEOC is watching how wellness programs are implemented. While there are still pending lawsuits that will determine final regulations, this is something for an employer to be aware of.

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More Specific Regulations Under the ACA

For health-contingent programs, there are additional specific regulations outlined in the ACA:

  • The program must be created to either prevent disease or promote health, and it must have a reasonable chance of achieving these goals for those who participate. In other words, it cannot be unreasonably difficult to achieve, and it should not use methods that are highly suspect.
  • The program must be available to all similarly-situated employees, and alternatives must be available for those who have medical conditions that make the minimum standards unreasonably difficult. For example, going back to the BMI reduction program we noted above, if the standard is to achieve a BMI of 26 within a specified time frame in order to get a reduction in insurance costs, it might be unreasonable to expect that achievement in a short time frame for someone who starts with a BMI of 37. This is, of course, just one example. Employers are not required to think of all eventualities, but alternatives must be made available on request. (The regulations specify that the plan must state that there are alternatives available, and it should explain how to request that the minimum standards be waived or altered when applicable.)

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  • Employees who are eligible for these types of programs should be able to try to achieve the reward at least once per year.
  • The rewards offered for achieving the health standards in question cannot be more than 30 percent of the cost of the employee health coverage. (This is increased to 50 percent for health-contingent programs related to reducing or stopping tobacco use.)

In summary, employers should be careful to remain in legal compliance when crafting employee wellness programs. This means ensuring that the wellness program benefits meet the guidelines above and allow voluntary participation without going against other related laws. Be sure your employees in human resources (or other applicable managers) are up to speed on what they need to know for wellness program compliance.