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News Release

Janet Hayes – Wellness Plans: From Burgers to Broccoli

I am wearing gym shoes, guzzling water and rushing to finish this article in time for yoga class.

Like so many Americans, the “healthy lifestyle” is my illusive goal. As our societal focus has shifted from burgers to broccoli, the healthy living initiative also has crept into the workplace.

Recognizing that a healthy workforce results in reduced absences, lower health care costs, and improved productivity, many businesses have developed workplace wellness programs.

A “wellness program” generally refers to an employer-sponsored program in which employees are encouraged to achieve certain health-related goals. The programs can target a variety of health issues such as weight loss, blood pressure, exercise or nutrition. Many programs ask employees to answer questions on a health risk assessment and/or require medical screenings to set baselines and monitor progress. When goals are met, employees may receive rewards in the form of discounted health insurance or other incentives.

While wellness programs seem like a “win/win,” they have become the target of multiple legal challenges. There are several federal laws at play. The Health Insurance Portability and Accountability Act, the Affordable Care Act, and the Americans with Disabilities Act impact the nature and extent to which employers can obtain and utilize employees’ private medical information. The Genetic Information Nondiscrimination Act and the ADA both prohibit discrimination against employees based on certain medical information and conditions.  Wellness programs have come under fire as alleged violations of these laws. Because the applicable legal standards can vary from one law to the other, employers have become understandably confused about what is and is not permissible.

In an effort to create some uniformity in the law and offer clarity for employers, the Equal Employment Opportunity Commission issued a Final Rule effective Jan. 1. A few takeaways include:

  • Employers must meet strict confidentiality standards regarding medical information;
  • The ACA (as it exists at the moment) and the EEOC Final Rule allow and encourage programs that only reward employee participation (as opposed to outcomes);
  • If a program ties a reward to an employee achieving a certain outcome, the program must meet strict requirements including limiting the reward to 30 percent of the total cost of the employee-only coverage under the employer’s health plan (50 percent for smoking cessation programs) and demonstrating the program is reasonably designed to prevent disease or promote health (not based on crash diets or highly suspect methods); and
  • Employee participation in the program must be completely voluntary.

The Final Rule also establishes multiple other compliance requirements, defines critical terms (like what it means to be a “voluntary” program) and warns against disability discrimination.

Those who want to maintain or start programs should consult with a lawyer as the legal pitfalls are numerous. Unfortunately, the legal complexity is prompting some employers to forego the broccoli, stick with burgers, and completely ditch the wellness plans.

See the article in the Knoxville News Sentinel
part of the USA Today network

Janet S. Hayes

Janet Hayes, a Shareholder in the Knoxville office, is an advocate for employers and businesses across the state. Her practice is focused on employment and appellate law.

Ms. Hayes has successfully defended all types of employment claims including sexual harassment, retaliatory discharge, discrimination, workers’ compensation, invasion of privacy, wage/hour claims, and denial of benefits.