Insurance Law

Don't participate in employee wellness program? Penalty can't be too harsh, EEOC says in draft rules

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Employers who want to punish employees who don’t participate in wellness programs can’t be too punitive, according to draft regulations by the U.S. Equal Employment Opportunity Commission.

The preliminary regulations were drafted to take into account the Americans With Disabilities Act, which restricts medical information that employers can obtain from workers, and federal law that generally bars group health plans from discriminating based on health. Programs that inquire about health at work must be voluntary; the new regulations define the word “voluntary,” reports.

The draft rules say that, in a voluntary program, employers can’t require employees to participate, and can’t deny or limit access to health coverage for employees who don’t participate, the story says.

Employers can hike or reduce health plan costs to reward or penalize employees who don’t participate—up to a point. The draft regulations say penalties or rewards for failing to participate in wellness programs can’t exceed 30 percent of the total cost of employee-only health coverage.

The 30 percent cap already applied to wellness programs with mandated health outcomes, the Wall Street Journal (sub. req.) explains. The new regulation extends the cap to participation-only programs that require the employee to participate in a biometric screening or reveal health information.

See also: “EEOC sues Honeywell, says wellness program medical testing violates ADA”

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