Bcompliance2003 Posted July 29 Share Posted July 29 We have a client who gives premium incentives to the employees for getting a physical- I know that's fine. But now they want to require spouses to have a physical if they are on the plan as well-- and "require" them to do so to be on the plan. Can they do that? I know they can probably give an additional premium discount, but can they require the physical for them to be enrolled? That seems extreme, but I need to know the rules so we can forward it to them. Link to comment Share on other sites More sharing options...
Brian Gilmore Posted July 29 Share Posted July 29 At a minimum, the ADA side of the (sprawling) wellness program rules aren't going to permit that approach. The ADA rules require that any incentives involving medical examinations be "voluntary." That means there can't be any requirement to participate or denial of coverage for non-participation. Those rules are a bit murky because the regs were pulled and not replaced, but this is a pretty obvious one that doesn't really need to get into the weeds. 29 CFR §1630.14: (d) Other acceptable examinations and inquiries. A covered entity may conduct voluntary medical examinations and activities, including voluntary medical histories, which are part of an employee health program available to employees at the work site. (1) Employee health program. An employee health program, including any disability-related inquiries or medical examinations that are part of such program, must be reasonably designed to promote health or prevent disease. A program satisfies this standard if it has a reasonable chance of improving the health of, or preventing disease in, participating employees, and it is not overly burdensome, is not a subterfuge for violating the ADA or other laws prohibiting employment discrimination, and is not highly suspect in the method chosen to promote health or prevent disease. A program consisting of a measurement, test, screening, or collection of health-related information without providing results, follow-up information, or advice designed to improve the health of participating employees is not reasonably designed to promote health or prevent disease, unless the collected information actually is used to design a program that addresses at least a subset of the conditions identified. A program also is not reasonably designed if it exists mainly to shift costs from the covered entity to targeted employees based on their health or simply to give an employer information to estimate future health care costs. Whether an employee health program is reasonably designed to promote health or prevent disease is evaluated in light of all the relevant facts and circumstances. (2) Voluntary. An employee health program that includes disability-related inquiries or medical examinations (including disability-related inquiries or medical examinations that are part of a health risk assessment) is voluntary as long as a covered entity: (i) Does not require employees to participate; (ii) Does not deny coverage under any of its group health plans or particular benefits packages within a group health plan for non-participation, or limit the extent of benefits (except as allowed under paragraph (d)(3) of this section) for employees who do not participate; (iii) Does not take any adverse employment action or retaliate against, interfere with, coerce, intimidate, or threaten employees within the meaning of Section 503 of the ADA, codified at 42 U.S.C. 12203; and (iv) Provides employees with a notice that: (A) Is written so that the employee from whom medical information is being obtained is reasonably likely to understand it; (B) Describes the type of medical information that will be obtained and the specific purposes for which the medical information will be used; and (C) Describes the restrictions on the disclosure of the employee's medical information, the employer representatives or other parties with whom the information will be shared, and the methods that the covered entity will use to ensure that medical information is not improperly disclosed (including whether it complies with the measures set forth in the HIPAA regulations codified at 45 CFR parts 160 and 164). Slide summary: 2024 Newfront Wellness Program Guide Bcompliance2003 and Peter Gulia 1 1 Link to comment Share on other sites More sharing options...
Peter Gulia Posted July 29 Share Posted July 29 Brian Gilmore, thank you for giving so generously to our learning. Even if one accepts the executive agency’s rule as a reasoned interpretation of Congress’s statute: 29 C.F.R. § 1630.14 has 30 uses of the word employee, but no use of spouse, dependent, beneficiary, or participant. If one reads only the text of this rule, there might be some ambiguities about whether an employee-benefit plan’s condition regarding a medical examination of an employee’s spouse is, in particular circumstances, “a subterfuge for violating the [equal-employment provisions of the Americans with Disabilities Act] or other laws prohibiting employment discrimination[.]” 29 C.F.R. § 1630.14(d)(1) https://www.ecfr.gov/current/title-29/part-1630/section-1630.14#p-1630.14(d)(1). Further, ERISA, the Public Health Service Act, the Internal Revenue Code, the Affordable Care Act, and other Federal and (not superseded) State laws might affect the plan sponsor’s choices. These and other laws might matter in how an employer and plan sponsor thinks about questions of the kind Bcompliance2003 describes. It’s complex enough that one would want information and advice from a team of employment, employee-benefits, and other lawyers. Brian Gilmore 1 Peter Gulia PC Fiduciary Guidance Counsel Philadelphia, Pennsylvania 215-732-1552 Peter@FiduciaryGuidanceCounsel.com Link to comment Share on other sites More sharing options...
Brian Gilmore Posted July 29 Share Posted July 29 Great point, Peter. I think you're right that those ADA rules can be read to apply only to the employee. Under that interpretation, the main consideration would turn to the HIPAA/ACA nondiscrimination rules. Assuming this is a "participatory" wellness arrangement (i.e., does not require the individual to satisfy a standard related to a health factor), the only HIPAA/ACA nondiscrim requirement is that the program be available to "similarly situated individuals" regardless of health status. We don't have the 30% limit or reasonable alternative standard rules that apply to health-contingent (activity-only and outcome-based) programs to worry about. Those regs say that "relationship to the participant" (e.g., spouse, child) can be a separate category of similarly situated individuals from the employee or other types of dependents. So in this case, they could argue that the spouse category is a separate group of similarly situated individuals with a permissible condition to enroll in the health plan based on the participatory wellness program requirement that they complete the annual physical. All of that is probably aggressive and would need to be viewed as a potential litigation risk, but I can at least see now how the theoretical pieces would fit together after considering Peter's response. Here's what I would look to if trying to justify that approach-- 29 CFR §2590.702: (d) Similarly situated individuals. The requirements of this section apply only within a group of individuals who are treated as similarly situated individuals. A plan or issuer may treat participants as a group of similarly situated individuals separate from beneficiaries. In addition, participants may be treated as two or more distinct groups of similarly situated individuals and beneficiaries may be treated as two or more distinct groups of similarly situated individuals in accordance with the rules of this paragraph (d). Moreover, if individuals have a choice of two or more benefit packages, individuals choosing one benefit package may be treated as one or more groups of similarly situated individuals distinct from individuals choosing another benefit package. ... (2) Beneficiaries. (i) Subject to paragraph (d)(3) of this section, a plan or issuer may treat beneficiaries as two or more distinct groups of similarly situated individuals if the distinction between or among the groups of beneficiaries is based on any of the following factors: (A) A bona fide employment-based classification of the participant through whom the beneficiary is receiving coverage; (B) Relationship to the participant (for example, as a spouse or as a dependent child); (C) Marital status; (D) With respect to children of a participant, age or student status; or (E) Any other factor if the factor is not a health factor. (ii) Paragraph (d)(2)(i) of this section does not prevent more favorable treatment of individuals with adverse health factors in accordance with paragraph (g) of this section. ... (f) Nondiscriminatory wellness programs — in general. A wellness program is a program of health promotion or disease prevention. Paragraphs (b)(2)(ii) and (c)(3) of this section provide exceptions to the general prohibitions against discrimination based on a health factor for plan provisions that vary benefits (including cost-sharing mechanisms) or the premium or contribution for similarly situated individuals in connection with a wellness program that satisfies the requirements of this paragraph (f). (1) Definitions. The definitions in this paragraph (f)(1) govern in applying the provisions of this paragraph (f). ... (ii) Participatory wellness programs. If none of the conditions for obtaining a reward under a wellness program is based on an individual satisfying a standard that is related to a health factor (or if a wellness program does not provide a reward), the wellness program is a participatory wellness program. Examples of participatory wellness programs are: (A) A program that reimburses employees for all or part of the cost for membership in a fitness center. (B) A diagnostic testing program that provides a reward for participation in that program and does not base any part of the reward on outcomes. (C) A program that encourages preventive care through the waiver of the copayment or deductible requirement under a group health plan for the costs of, for example, prenatal care or well-baby visits. (Note that, with respect to non-grandfathered plans, §2590.715-2713 of this part requires benefits for certain preventive health services without the imposition of cost sharing.) (D) A program that reimburses employees for the costs of participating, or that otherwise provides a reward for participating, in a smoking cessation program without regard to whether the employee quits smoking. (E) A program that provides a reward to employees for attending a monthly, no-cost health education seminar. (F) A program that provides a reward to employees who complete a health risk assessment regarding current health status, without any further action (educational or otherwise) required by the employee with regard to the health issues identified as part of the assessment. (See also §2590.702-1 for rules prohibiting collection of genetic information.) ... (2) Requirement for participatory wellness programs. A participatory wellness program, as described in paragraph (f)(1)(ii) of this section, does not violate the provisions of this section only if participation in the program is made available to all similarly situated individuals, regardless of health status. Peter Gulia 1 Link to comment Share on other sites More sharing options...
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