A backlash is building against the Equal Employment Opportunity Commission’s recent moves to challenge certain workplace wellness programs offered by large U.S. employers.
The EEOC’s actions are threatening to erode backing for the Affordable Care Act among large corporations who have supported the law because it included provisions encouraging the wellness programs. Employers are pleading with the EEOC to issue clear guidelines, but to date none have been issued.
That’s left many employers wondering whether they could be next if the EEOC deems that their wellness plans run afoul of the ACA, the Americans with Disabilities Act (ADA) or the Genetic Information Nondiscrimination Act (GINA), among other laws.
Wellness programs are designed to tackle health care costs by getting employee health plan participants to quit smoking, lose weight, and reduce hypertension and other risk factors that can lead to expensive illnesses. The ACA authorizes employers to reward workers who participate in wellness plans and penalize those who don’t.
But recent lawsuits filed by the EEOC have raised concerns about how far employers can go with their wellness plans.
The latest case, EEOC vs. Honeywell International Inc., was filed in federal district court in Minnesota on Oct. 27. In the case, the EEOC originally sought to enjoin Honeywell from implementing its wellness program, charging violations of both the ADA and GINA.
The ACA allows financial incentives for workers taking part in workplace wellness programs of up to 50% of their monthly premiums, deductibles and other costs.
Often wellness plan participants must fill out detailed health questionnaires, undergo medical screenings and in some cases attend weight-loss or smoking-cessation programs.
One of the arguments presented in the lawsuit against three employers is that requiring medical testing violates the ADA.
The Honeywell case
Starting in 2015, the biometric testing for Honeywell’s employees and their spouses will be part of a screening to help identify health risks. It will include checks for blood pressure, HDL and total cholesterol, non-fasting glucose levels, body mass index and waist circumference. Blood will also be screened to determine whether the employee or spouse smokes tobacco.
Employees will be penalized (or lose incentives) if they or their spouses do not take the biometric tests, including the blood draw. They would be subject to:
- A $500 surcharge applied to the employee’s medical plan costs.
- A $1,000 “tobacco surcharge,” even if the employee declines to participate in the biometric testing for reasons other than smoking (since, presumably, absence of tobacco can’t be verified).
- An additional $1,000 “tobacco surcharge” if the employee’s covered spouse does not submit to the testing, even if the spouse declines to participate for reasons other than smoking.
- Loss of health savings account contributions from Honeywell, which range up to $1,500 depending on the employee’s annual base wage and type of coverage.
Honeywell says its financial incentives fall within the range specified as allowable under the ACA.
The EEOC claims that Honeywell’s incentives violate the ADA because employees are penalized in order to induce them to go through medical examinations that are not job-related or consistent with business necessity.
Although there is an exception to this rule for “voluntary” health exams, the agency claims that these exams are not voluntary because Honeywell imposes a penalty on employees who decline to participate.
The EEOC also claims it violates the GINA.
Employers are concerned because biometric screenings and incentives to participate in screenings are typically key features of wellness plans.
Wellness programs with biometric screenings have become widespread, as are financial incentives to promote health participation in these screenings. Overall, among large U.S. employers that offer wellness programs, about three in four use incentives to engage employees in them – although not necessarily in health screenings – according to the nonprofit National Business Group on Health.
Employers have been seeking guidance from the EEOC for years regarding how the ADA and the GINA apply to wellness programs.
But to date, the EEOC hasn’t issued any guidance, which is leaving more employers concerned that their wellness plans may also be targeted in the future.