When Does Workplace Wellness Become Coercive?
By Julie Appleby
June 24, 2015 - Kaiser Health News
Christine White pays $300 a year more for her health care because she refused
to join her former employerfs wellness program, which would have required that
she fill out a health questionnaire and join activities like Weight
Watchers.
gIf I didnft have the money c Ifd have toh participate, says White, 63, a
retired groundskeeper from a Portland, Ore., community college.
Like many Americans, White gets her health coverage
through an employer that uses financial rewards and penalties to get workers to
sign up for wellness programs. Participation used to be a simple matter —
taking optional classes in nutrition or how to stop smoking. But today, a
small but growing number of employers tie those financial rewards to losing
weight, exercising or dropping cholesterol or blood-sugar levels — often
requiring workers to provide personal health information to private contractors
who administer the programs. The incentives, meanwhile, can add up to
hundreds, or even thousands, of dollars a year.
Employers say wellness programs boost workersf health and productivity while
helping companies curb rising health care costs. President Barack Obamafs
signature health law allows employers to increase those financial
incentives. But asking workers to undergo medical exams or share personal
health information is sharply limited by another law, the 1990 Americans With
Disabilities Act (ADA), which prohibits such questioning — except under limited
circumstances, such as by voluntary wellness programs.
So what is a voluntary wellness program and when do employer incentives cross
the line to become coercive?
A
proposed rule published this spring by the Equal Employment Opportunity
Commission – the agency charged with protecting workers against discrimination –
attempts to strike a balance between employers who want to use incentives to
drive worker participation and consumer advocates who see penalties as de facto
coercion. The plan drew
about 300 comments from employers and consumer groups by a June 19 deadline,
with plenty of criticism.
The equation tilts too far against workers gwhen c employers
can charge you a couple thousand dollars more for refusing to give private
medical information, [that] doesnft sound very voluntary to me,h said Samuel
Bagenstos, a University of Michigan Law School professor.
But many employers say the proposal doesnft clear up conflicts between the
health law and the ADA. In addition, it restricts their ability to offer
rewards, which are needed to gengage employees and their families to be aware of
their c lifestyle risks,h said Steve Wojcik, vice president of public policy for
the National Business Group on Health. The EEOC has not set a timetable for
issuing a final rule.
Employers Want More Flexibility
Under the proposal, wellness programs would be considered voluntary so long
as the employer rewards or penalizes an employee no more than 30 percent of the
cost of health insurance for a single worker. Since the average cost for such
coverage is $6,025 a year, the 30 percent limit would be about $1,800.
Employers cannot fire workers for declining to participate nor can they deny
them coverage, the proposal says. They also must give workers a notice
explaining what medical information will be obtained by the wellness
administrator — often a private contractor — and how that might be used.
Some employers say the rule could force them to cut the size of wellness
programsf financial incentives or penalties, particularly for families and
smokers. Such limits could mean gadvancements in workplace health
improvement may come to an end,h wrote the Northeast Business Group on Health, a
coalition of large employers, insurers and benefit consultants.
Consumer groups are also unhappy, saying the proposal strips workers of
important protections against health or disability-related discrimination by
loosening earlier government definitions of what constitutes voluntary.
gIt walks back peoplefs rights,h said Jennifer Mathis, director of programs
for the nonprofit Bazelon Center for Mental Health Law, a legal advocacy
organization for people with mental disabilities. In its comments, the group
said the proposal would allow gemployers to use steep financial penalties in
wellness programs to force workers to disclose sensitive medical
information.h
Interest in workplace wellness programs began two decades ago, prompted by
employersf rising health care spending. Today, a growing percentage of companies
ask workers to answer lengthy questionnaires about their health, including their
exercise and drinking habits and whether they are depressed. Some employers also
require testing of cholesterol levels and blood sugar to assess who might be at
risk for heart trouble, diabetes or other problems.
About 56 percent of employers with wellness programs offered financial
incentives last year, according to benefits firm Mercer, with 23 percent of
large employers tying those incentives to showing progress on health care goals,
such as exercising more, losing weight, dropping cholesterol levels or improving
blood sugar readings.
While aimed at preventing illness and encouraging a healthy lifestyle as a
way to reduce health care costs, there is wide debate over whether the programs
achieve those goals.
Obamacare Okfd Bigger Incentives
The health law permits employers to offer incentives or penalties of up to 30
percent of the cost of a health insurance plan – up from 20 percent under a
previous regulation – if they set specific health goals for workers, such as
quitting smoking or achieving certain results on medical tests. Most employersf
incentives are still well below those levels.
How does that square with the ADAfs restrictions on employers asking for
personal medical information? Thatfs where it gets complicated. The EEOC long
defined voluntary wellness programs under the ADA as those where gan employer
neither requires participation, nor penalizes employees who do not
participate.h
But what constitutes a penalty? Prior to the proposed rule, it was clear that
employers who tried to charge workers the full cost of their insurance, or who
barred them from coverage for refusing to participate, could run into trouble,
said Sarah Millar, a partner at law firm Drinker Biddle in Chicago.
gWhat was not clear was at what point between zero and 100 percent [of the
cost of employee health coverage] does a program not become voluntary?h she
said. gNow, as long as itfs below 30 percent and meets certain disclosure
requirements, then a program is still considered voluntary.h
Some consumer advocates say that level is punitive.
gMedical questions that an employee may only decline to answer if he or she
agrees to pay thousands of dollars more for health insurance can hardly be
called evoluntary,fh the Bazelon center wrote. The group wants the
government to prohibit penalties for those who decline to answer such
questions.
Consumers Seek Privacy Protections
Consumer groups also want increased privacy protections for those who share
their health information with a wellness plan.
The proposed rule says employers whose wellness programs are tied to their
health insurance benefits must tell workers specifically what information will
be gathered and with whom it might be shared.
Still, Anna Slomovic, a researcher at the George Washington University Cyber
Security Policy and Research Institute, says that provision should be broadened
to encompass wellness programs that are unrelated to a health plan.
gThis leaves unregulated a number of wellness programs c even though these
programs collect personal health data,h she said in her comments. The
protections should include all data, gincluding that collected via fitness
trackers and mobile apps.h
Many employers also asked the administration to allow them to impose
penalties of up to 50 percent of insurance costs for tobacco users, which the
federal health law allows.
gThis is potentially putting a wrench in the system for some employers,h said
Seth Perretta, a principal at the Groom Law Group in Washington D.C. gIf itfs
finalized, it would force them to reduce incentives back to 30 percent.h
Additionally, employers want to be able to charge workers 30 percent of the
cost of more expensive family coverage, if the family is also eligible to
participate in the wellness program — something the federal health law allows
but the proposed rule does not. That could dramatically increase the dollar
amount of the financial incentive or penalty.