Examine Risks of Wellness Program

GINA and ADA could spell trouble for employer-sponsored programs

By Karen R. McLeese

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The well-being of wellness programs is coming into question these days, and employers will need to be sure their programs get along with GINA and ADA.

At the heart of the uncertainty is the health risk assessment, one of the most common tools used in wellness programs. While such an assessment can take many forms, generally it involves collecting personal medical information, which may include family medical history and genetic information. The purpose of collecting the information is generally to target any medical condition an individual may have, or may be predisposed to have, and to address the condition before it gets out of hand.

While wellness programs are being contemplated by virtually all of the healthcare reforms being proposed, how they can be administered within the strictures of two laws with ladylike acronyms remains an open question.

Potential Conflicts with GINA
The Genetic Information Nondiscrimination Act of 2008 (GINA), enacted in May 2008, restricts the use of family medical history and genetic information for purposes of eligibility and rating, except to the extent that it is based on a manifest condition. Plans are also prohibited from altering a premium or contribution amount based upon an individual’s genetic nature. While GINA appears to allow voluntary health risk assessments, the outstanding question is, “What does ‘voluntary’ mean?”

Regulations relating to the health plan provisions of GINA were released by the CMS, DOL and IRS last October, and regulations relating to its employment provisions are expected to be released at any time now. In a nutshell, these regulations define the use of genetic information and family medical history for health plan purposes. These regulations may affect an employer’s wellness program design and, in particular, its health risk assessment tool.

It’s very clear that a health risk assessment cannot be used for, or in connection with, enrollment. Nor can it be used for underwriting purposes, which includes premium discounts, benefit access or other financial rewards, if genetic information or family medical history is collected. Given that these regulations will take effect in very short order, employers should review their wellness program design and make appropriate modifications.

Through a series of examples, the regulations describe permissible and impermissible health risk assessment design. In summary, if the intent is to collect genetic information and family medical history, the health risk assessment must be administered after the effective date of coverage and cannot result in any kind of financial or benefit reward or detriment.

If a financial reward is to be tied to the health risk assessment, the assessment must be cleansed of all genetic information, including family medical history. The questions on the assessment should be reviewed carefully to ensure that they do not explicitly or implicitly elicit genetic information or family medical history.

Potential Conflicts with ADA
The increased use of wellness programs also raises issues relating to the Americans with Disabilities Act (ADA), as amended by the Americans with Disabilities Amendments Act of 2008 (ADAA). This law prohibits employment discrimination against qualified individuals on the basis of disability. The potential risk can arise in a couple of ways:

• Do disability-related questions such as “Do you have diabetes or high blood pressure?” violate the ADA by virtue of not being job-related?

• Is it a violation of ADA if coverage under a health plan is contingent upon completing a health risk assessment?

The EEOC has not provided formal guidance on this matter, but it has issued two informal opinions.

In March 2009, the EEOC contemplated the scenario of participation in the health plan being contingent upon completing a health risk assessment. According to the EEOC, this kind of arrangement violates the ADA. Making eligibility for health coverage contingent upon completing a health risk assessment is an impermissible use of medical information, in contravention of the ADA.

Last August, the EEOC issued a second informal opinion letter relating to the use of a health risk assessment as a condition of receiving a contribution to an employer-sponsored health reimbursement arrangement. The required health risk assessment asked a series of more than 100 questions, including family health history, self-care, personal health, women’s health, nutrition/health choices, physical activity, and alcohol and tobacco usage, many of which were determined by the EEOC to be disability-related. The EEOC concluded that these questions were not job-related, nor justifiable as a business necessity. While disability-related inquiries and medical examinations are permitted as part of a voluntary wellness program, a wellness program is considered “voluntary” only if employees are neither required to participate nor penalized for non-participation.

Enter HIPAA
The EEOC is contemplating whether the Health Insurance Portability and Accountability Act of 1996 (HIPAA) nondiscrimination rules based on health status could be used as a roadmap for determining “voluntariness.” These rules prohibit group health plans from discriminating against individuals based on health status-related factors, such as current or prior medical conditions and claims experience.

HIPAA’s nondiscrimination rules specifically address wellness programs. If a wellness program is outcome-based (dependent upon achieving a goal), then the program must meet five criteria:

1. The reward, taken together with all rewards from other wellness programs, cannot exceed 20 percent of the cost of the relevant coverage (for example, single, full family, individual plus one).
2. The program must be reasonably designed to promote health or prevent disease, and cannot be overly burdensome; nor can it be designed as a subterfuge to evade the law.
3. The program must give individuals the ability to qualify for the program at least once annually.
4. The program must be available to all individuals, with alternative methods of compliance made available for those who cannot comply because of health reasons.
5. The availability of alternative standards must be described in any wellness program literature.

What to Do
To make sure your wellness program stays healthy, it’s important that you carefully review the program and specifically the health risk assessment.

Identify any genetic information and family medical history, and be sure to remove this information if the health risk assessment is to be used for enrollment, in connection with enrollment or for underwriting purposes.

Also identify disability-based questions and determine whether these questions are permissible or impermissible under the ADA. And finally, consider whether the wellness program, including the health risk assessment, satisfies the “voluntary” standard.

You could call it a health risk assessment of your wellness program.

WP

Karen R. McLeese is Vice President of Employee Benefit Regulatory Affairs for CBIZ Benefits & Insurance Services Inc., a division of CBIZ Inc. She serves as in-house counsel, with particular emphasis on monitoring and interpreting state and federal employee benefits law. McLeese is based in the Leawood, Kansas CBIZ office.

Useful link related to this article:
March 9 Audioconference: Hidden Wellness Risks: What You Need to Know Before Gathering Employee Information
http://workplacetrainingcenter.com/Prod-1494.aspx