Employee Benefits

EEOC Removes 30% Incentive Safe Harbor from Wellness Program Regulations

Jan 10, 2019

Russell M. Johnson,

Associate

The Equal Employment Opportunity Commission (the “EEOC”) issued final rules, published in the Federal Register on December 20, 2018, that remove the 30% incentive provisions from the EEOC’s wellness program regulations governing the Americans with Disabilities Act (“ADA”) and the Genetic Information Nondiscrimination Act (“GINA”). The final rules are effective January 1, 2019. As a reminder, the ADA rules previously provided that a wellness program that asks questions about employees’ health or includes medical examinations is not voluntary if the incentive to encourage employee participation in the program exceeds 30% of the total cost of self-only coverage. The GINA rules previously provided that an employer may not offer an incentive that exceeds 30% of the total cost of self-only coverage to an employee to encourage a spouse’s participation in a health risk assessment under a wellness program.

These final rules respond to the ruling in AARP v. EEOC that vacated the 30% incentive provisions, as discussed in our previous blog post “Wellness Incentives Under Scrutiny After District Court Decision.” Employers may be served well to note that the rest of the EEOC’s ADA and GINA rules for wellness programs remain in effect.

Please refer to our previous blogs, “EEOC Final Rules on Wellness Programs and the ADA – Worth the Wait?” and “Wellness Rules Under the ADA – Will There Ever Be Certainty?” for more information regarding wellness programs under the ADA and potential strategies for how to proceed with wellness initiatives despite the uncertainty surrounding the incentive rules.

Although these rules are in final form, this likely is not the EEOC’s last word on wellness programs, as the agency issued notice here and here that it intends to publish new proposed regulations by June 2019.

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