EEOC Defers Guidance on Wellness Program Incentive Limits

Last month we posted a blog on shoring up your wellness programs; to read that blog, please click here. With an update last week from the EEOC, employers may want to reconsider decisions whether to modify wellness program incentives that trigger provisions of the ADA and GINA.  The EEOC is now expected to provide further guidance by June of 2019.

Pending guidance involves modification to the maximum incentive amount tied to employee participation in a wellness program. In the case promulgating these changes, the AARP argued the 30% maximum was “capricious” and essentially amounted to creating “involuntary” employee participation in the wellness program (to avoid paying increased medical premiums).  A federal judge agreed and ordered the EEOC to vacate portions of the rules discussing incentives; those changes are effective January 1, 2019.

In the meantime, employers must plan wellness program design in murky waters; whether to modify an applicable wellness program with 30% incentive limits (or even one with a smaller incentive) is a decision to be made by counsel and business leaders.  Relevant factors to consider when weighing these decisions: wellness program design and participation rates, employee feedback, risks to the business and historical regulatory response in similar cases.

Until next Summer, however, it may be wise to thoroughly evaluate your wellness programs, ensuring program design (including incentive amounts) falls within current guidelines (and perhaps shy of them). Compliancedashboard® will keep you updated as the EEOC releases further guidance.