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Friday, October 31, 2014

This week, the EEOC filed its third, and perhaps most significant, complaint in a wellness-related case.  The complaint alleges that the wellness program, which involved biometric screening and a surcharge for tobacco users, violates the Americans with Disabilities Act (ADA) and Genetic Information Nondiscrimination Act (GINA). The ADA complaint is that the program requires a medical examination that is not job-related or consistent with business necessity.  The GINA complaint is that the employer is providing a prohibited inducement to receive genetic information. The maximum penalty under the program is $4,000 per year.

While the details of the program are not fully fleshed out in the complaint, this appears to be an escalation of the EEOC’s focus on wellness programs.  While $4,000 is a significant sum of money, this appears to us to be a typical wellness program.

The frustrating aspect of these wellness program lawsuits is that it appears to be a case of the EEOC foregoing the rulemaking process in favor of litigation.  The HIPAA wellness regulations have been in effect since 2006 and people have been asking for guidance from the EEOC since then.  Until these lawsuits, it has largely been crickets, other than a few informal letters that didn’t help much.

Additionally, the Affordable Care Act basically took those rules and made them part of the ACA statutory framework back in 2010.  This shows a clear Congressional intent to encourage these programs.  When all we had were the 2006 HIPAA rules, the EEOC could have cogently argued that it owed no real deference to those rules.  That argument loses much of its steam with these rules being embodied in the U.S. Code.

Small Angry Human Shape Scolds the OthersFinally, in 2012, the Eleventh Circuit Court of Appeals dealt a significant blow to the positions the EEOC is taking in these cases with respect to the ADA.  It ruled that the terms of the wellness program in that case were a term of a bona fide benefit plan, which at least under the ADA, made any medical examinations exempt from the ADA’s prohibition on involuntary medical examinations that are not job-related and necessary.  Additionally, if the program is a term of a plan, it would arguably fall under a separate section of GINA over which the EEOC does not have enforcement authority.  That could effectively nullify the EEOC’s GINA complaint.

Between the Eleventh Circuit case and the clear Congressional intent in the ACA, it is disappointing for the EEOC to pursue these cases rather than try to address them through traditional rulemaking.  Employers with wellness programs should review this new complaint carefully.  Curbing existing wellness programs may or may not be warranted based on the EEOC’s recent spate of lawsuits, depending on the nature of the employer’s program.  Employers would also be well-advised to review the EEOC’s positions prior to taking steps to implement new or expand existing wellness programs.

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