By: Paul H. Kehoe
On March 2, 2015, U.S. Senate Committee on Health, Education, Labor & Pensions Chairman Lamar Alexander (R-Tenn.) and U.S. House of Representatives Education and the Workforce Committee Chairman John Kline (R-Minn.) introduced companion bills entitled “Preserving Employee Wellness Programs Act.” The legislation, found here, was cosponsored Sens. Mike Enzi (R-Wyo.), Johnny Isakson (R-Ga.), Tim Scott (R-S.C.), Orrin Hatch (R-Utah), Pat Roberts (R-Kan.), and Rep. Tim Walberg (R-Mich.). These bills come on the heels of the Senate HELP Committee’s January 29, 2015 hearing on wellness programs and related EEOC enforcement. The legislation addresses several potential problems for both employers and employees under the Americans with Disabilities Act (“ADA”), as amended, and the Genetic Information Nondiscrimination Act (“GINA”).
First, the legislation would resolve the issue of whether an incentive or surcharge permitted (indeed, encouraged) under the Patient Protection and Affordable Care Act (“ACA”) is nonetheless impermissible under the ADA and GINA. Under the ACA and its implementing regulations issued by the Departments of Labor, Treasury and Health and Human Services, employers may offer financial incentives to employees up to 30% of their health care premiums for participating in and reaching certain health outcomes in a wellness plan (and up to 50% for smoking cessation programs). Under the ADA, medical examinations (including biometric screening) are not permitted unless such inquiries are either job related and consistent with business necessity or voluntary.
As you may recall, the EEOC recently sued Honeywell International seeking a preliminary injunction to stop it from implementing its wellness plan, which required employees to undergo biometric testing to obtain financial incentives. The EEOC’s theory was that Honeywell’s incentives offered through its wellness program made participation non-voluntary under the ADA and GINA even if the incentives complied with the ACA and its implementing regulations. The legislation would essentially deem compliance with the ACA to be compliance with the ADA, and foreclose any argument that a compliant incentive or surcharge under the ACA could violate the ADA or GINA.
Second, the legislation provides that collecting information about a manifested disease or disorder of a family member would not be an unlawful acquisition of genetic information of the employee under GINA. The regulated community has, for years, raised concerns about EEOC investigations into incentives offered to employee spouses for completing health risk assessments where information related to manifested conditions is inquired about. The legislation would address that concern.
Finally, if enacted, the legislation would supersede any regulations promulgated by the EEOC on these issues in the coming months. It would eliminate confusion caused by the EEOC and allow employers to design compliant wellness programs to the extent authorized by Congress under the ACA. We will keep you updated on developments regarding wellness plans and the forthcoming EEOC proposed regulations which are expected in the near future.