What Small Businesses Need to Know About Employer Wellness Programs

Feb 2, 2017

What Small Businesses Need to Know About Employer Wellness Programs

In 2016, the EEOC issued regulations to make sure employer wellness programs were also in harmony with the American With Disabilities Act and (ADA), and with Title II of the Genetic Information Nondiscrimination Act (GINA). These new regulations are primarily aimed at making sure any employer wellness program is voluntary, reasonably designed to be inclusive of all employees, and keeps all employee medical information confidential.

Incentives and Voluntary Participation

The new changes make it clear that employers are allowed to use small incentives to persuade employees to participate in wellness programs. These incentives can include financial incentives or things such as extra time-off and prizes. Employers also have to make reasonable accommodations to make sure all employees have a chance to earn the incentives.

For example, if there is an incentive for attending a nutrition class, the employer would need to make sure there was a sign language interpreter available if there were any deaf employees wanting to participate.

The new regulations also go into detail about what it means for a wellness program to be voluntary. Prior to the changes the regulations did not define what “voluntary” meant. A program is not voluntary if:

  • Participation is required
  • Access to health insurance benefits is denied for non-participating employees
  • There are threats, coercion, intimidation, or interference with employees who decline to participate or fail to meet certain health goals

Incentives cannot be so large as to destroy the voluntary nature of participation in the program.

Defining “Reasonably Designed”

Another part of the earlier EEOC employer wellness program regulations that was vague was the definition of a “reasonably designed” program. Under the recent rule changes a wellness program is considered reasonably designed to promote health and prevent disease if the program:

  • Is not overly burdensome or intrusive
  • Is not a workaround for violating the ADA, or other laws prohibiting employment discrimination
  • Does not exist merely to shift health related costs to employees
  • Is not used to predict an employee’s future health costs

The EEOC wellness program regulations are designed to keep employers from using the programs in any way that appears compulsory, discriminatory, or is used to shift healthcare costs to employees based on health information obtained through the programs.

What Makes Sense for Your Business?

The employer wellness program regulations are mostly just clarifications that existing laws and regulations such as the ADA and GINA apply to all businesses in the wellness program context.

Employer wellness programs are not typically expensive to establish or maintain. As long as the program is setup in accordance with the regulations, including laws governing medical record privacy, these programs do not create a substantial new compliance risk for companies. There is no guarantee that every employer wellness program will pay for itself over time. However, wellness programs have been shown to have many benefits.

Employer wellness programs have been shown to improve employee health. Improved employee health can lower health care costs to the business. It can reduce absenteeism and increase productivity. Other benefits to wellness programs include increased employee happiness and reduction in turnover.

Before your business implements a wellness program, make sure your program is compliant with the latest regulations. DHR provides HR services and solutions - including developing wellness programs that are compliant with the latest regulations. Contact us today for more information.

Todd Miller

Written by Todd Miller

Director of Marketing, DHR

Todd leads DHR’s marketing department and is responsible for overall marketing strategy and execution. With nearly 15 years in the sourcing services and solutions space, Todd provides interesting insight on a variety of topics in this fast-paced and ever-changing industry.

Todd lives in Scottsdale with his two daughters and Collie/Shepard. One is a good boy.

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