It’s no secret that employers are increasingly taking a carrot and stick approach when it comes to motivating workers to improve their health. In a survey conducted by Mercer last year, 42 percent of employers with 500 employees or more said they offered incentives to workers to undergo health screenings and 23 percent tied incentives to an employee’s ability to achieve certain health goals, such as lowering blood pressure.

These strategies are designed to increase participation rates and lower health care costs in the long run. But the ability of employers to use rewards and penalties to influence worker behavior is now in question.

Last year, the U.S. Equal Employment Opportunity Commission (EEOC) filed three lawsuits against employers for imposing penalties on workers who refused to submit to health screenings as part of the companies’ wellness plans. The most recent case, filed last October, involves Honeywell Inc., whose employees incur surcharges for failing to undergo biometric testing.

The EEOC claims those practices violate the Americans with Disabilities Act (ADA), which prohibits employers from requiring medical exams unless they are voluntary or job related and consistent with business necessity. The suit was filed after complaints from Honeywell employees based at the company’s facilities in Minnesota.

Ryan Sarni, a staff attorney with Mountain States Employers Council, said the outcome of the case could have huge ramifications for how future wellness programs are designed.

“It could potentially shape how aggressive employers can be in sponsoring wellness programs,” said Sarni, who will lead a breakout session about the legal pitfalls associated with wellness programs at this year’s Colorado Culture of Health Conference.

Sarni’s discussion will focus on describing privacy security rules, ADA violations, and failure to provide a reasonable alternative as well as the Affordable Care Act, which increased the amount of incentives that employers can offer to entice workers to participate in wellness programs.

Honeywell has said that its program complies with the ACA and is voluntary.

“Although Honeywell’s wellness program complied with the incentive parameters established by HIPAA and the ACA, the EEOC claims the financial incentives render Honeywell’s wellness program involuntary and violative of the ADA. .If you read the regulations and case laws and statutes, it seems pretty clear to me that Honeywell is not doing anything wrong,” said Sarni. “The program is within the parameters of the law, so it’s strange that the EEOC is going forward with this challenge. But that’s why we have court system.”

In November, a federal district judge in Minneapolis denied the EEOC’s request for a court order to block Honeywell from assessing the surcharges as part of its wellness plan this year.

Sarni says he’ll be watching to see what happens next and he expects many employers – especially those considering incentive-based wellness plans – to also follow the case closely.

“Whether these companies move forward will depend on the individual employer’s comfort level. They don’t want to set up a plan and have it invalidated, so companies have to weigh how much they are going to save versus the risk of an adverse ruling.”

The Legal Pitfalls Associated With Wellness Plans Session will run from 10 am to 10:50 am. For more information about the conference schedule and Ryan Sarni, visit https://www.coloradocultureofhealth.org/schedule/

 

 

 

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