In 2015, the Equal Employment Opportunity Commission adopted regulations that limit the amount of incentives employers can provide employees to participate in wellness programs under the companies’ group medical insurance plans. According to the regulations, employers cannot offer incentives greater than 30 percent of the single coverage premium cost if the wellness program requires employees to disclose information protected under the Americans with Disabilities Act or the Genetic Information Nondiscrimination Act (GINA).
AARP sued the EEOC in federal court in the District of Columbia challenging the rules. Last year, the court invalidated the rules as arbitrary because the EEOC provided no reasoning for establishing the incentives limit at 30 percent. However, the court agreed to delay its order invalidating the rules until January 1, 2019, in order to give the EEOC an opportunity to issue revised regulations. The court concluded that it would be disruptive to alter wellness programs already in place for 2018.
Employer groups had complained about the EEOC rules, noting that the 30 percent incentives limit was less than similar limitations put in place by the Department of Labor under HIPAA and the Affordable Care Act. If the EEOC decides to amend its rules instead of appealing this ruling, perhaps the agency will consider establishing incentive limits consistent with those adopted by DOL.