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Employment Law

Walking the Line: Corporate Healthy Lifestyle Incentives, the ACA and the ADA

fitness

Businesses continue to offer health care benefits to their employees, firstly out of corporate culture tradition, and now in order to comply with the Affordable Care Act (ACA).

As corporate financial officers review the costs of providing that health care coverage, it becomes obvious that a healthier workforce affects the company’s bottom line. A more affordable group insurance rate is within reach when the employees are less sick. The actuaries of insurance companies base group rates on many factors including workers’ ages, relative previous health levels, smoking rates, the percentage of employees who are women are of childbearing age, and the number of catastrophic health claims in the recent past.

For many corporate leaders, it seems like a no-brainer to encourage the employees to lead a healthier lifestyle by rewarding healthier behavior: incentivizing smoking cessation programs, rewarding weight loss, and giving bonuses to those who achieve certain benchmarks of regular cardiovascular exercise. Some employers have required participation in wellness programs in exchange for enrollment in the corporate health insurance plan.

Yet, these corporate wellness programs may open up the offering institutions to discrimination lawsuits. Recently, the United States Equal Employment Opportunity Commission (EEOC) filed lawsuits against two Wisconsin companies that offered financial incentives to employees who participated in these corporate wellness programs.

The EEOC’s essential complaint was that the incentive program discriminated against employees whose physical conditions precluded them from participation. The EEOC viewed the incentive programs as unfair, offering rewards in a discriminatory fashion and maintained that the programs were a violation of the Americans with Disabilities Act (ADA).

It is a slippery slope. Many of the conditions that wellness programs try to target include obesity, hypertension, anxiety and depression, and diabetes. And yet, these health conditions can be considered disabilities, according to the ADA. So, corporations may either have to offer the incentives to everybody, regardless of who actually has participated (which is clearly not the best way to run an incentive program) or discontinue the programs altogether.

The EEOC is expected to issue guidelines on workplace wellness programs and ADA compliance, but they have not indicated when that will be published.