Alexander: EEOC General Counsel’s Actions May Discourage Employers from Using Wellness Programs to Lower Employee’s Health Care Costs

At hearing on employee wellness programs, says programs “give individuals some control over rising health care costs”

Posted on January 29, 2015

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“If we’re going to have a conversation in this country about enabling high-quality, lower-cost insurance, we should start with the roughly half of Americans who have health insurance through an employer.”  – Lamar Alexander 

WASHINGTON, Jan. 29, 2015 – U.S. Sen. Lamar Alexander (R-Tenn.), the chairman of the Senate health committee, today said that actions taken by the general counsel of the Equal Employment Opportunity Commission may discourage employers from using a tool authorized by Obamacare to lower employees’ health care costs. 

“Congress was clear in the health care law.  The administration was clear in the regulations of that law.  And the White House has again reiterated its support for these programs.  But apparently that is not clear enough for the EEOC.  EEOC is sending a confusing message to employers—reliance on Obamacare’s authorization of wellness programs does not mean you won’t be sued.” 

Excerpts of the chairman’s prepared remarks follow: 

“If we’re going to have a conversation in this country about enabling high-quality, lower-cost insurance, we should start with the roughly half of Americans who have health insurance through an employer. 

“That’s 159 million Americans—more than the 54 million individuals in Medicare, more than the 69 million Americans in Medicaid and CHIP. 

“Today, we’re going to hear from employers who are helping employees lower their insurance costs through employer wellness programs. 

“There is a lot of support for this: Secretary Burwell made an announcement on Monday that signaled a willingness to work with employers to reform the way that we provide health care to workers. In a similar vein, wellness programs are turning the table on the health care system, to make it more oriented to the individual. How do we help people be healthy instead of curing them when they’re sick? 

“Obamacare was not a bipartisan law, but it did include a bipartisan provision to strengthen workplace wellness programs.  Former Senator Harkin and I worked together on this during the HELP Committee markup of Obamacare.

“Before Obamacare, employers relied upon a 2006 regulation that empowered them to discount employee premiums up to 20 percent for making healthy lifestyle choices.

“Today, employers have certainty of law that they can give their employees up to 30 percent off of their premiums doing things like maintaining a healthy weight or keeping their cholesterol levels in check.

“The law also gave the Secretaries of Labor and Health the authority to extend this discount to 50 percent off through regulations. And the Secretaries did just that for tobacco cessation, so companies can also give employees who are smoke-free a 50 percent discount off their premiums.

“But these discount programs aren’t a blank check. Under the Affordable Care Act, employers have to meet several conditions.

“First, they cannot discriminate. Employers must make these programs available to everyone and must provide a reasonable alternative if an employee cannot complete the program’s standard requirement.

“Second, they have to be designed to promote health. So, your boss can’t offer a reward for a better job performance, but she can do so if you stop smoking.

“Third, everyone should have a chance to qualify at least once a year. To get started, employees might simply fill out a questionnaire about themselves and their family’s medical history, or undergo a basic health screening to take their weight, temperature, blood pressure, as well as a finger prick test for cholesterol or diabetes. 

“This information provides employees a baseline from which to work with a medical professional to improve. 

“The federal law dealing with privacy of medical information—we call it HIPAA, which stands for Health Insurance Portability and Accountability Act—prohibits employees’ medical information  from going to employers except in the aggregate.

“Some of the witnesses we’ll hear from today will tell us that well-designed plans can be very effective. 

“I want to know: Are they working as well as they could? There are a number of laws and regulations on the books governing wellness programs, but do employers have all the tools they need?

“And we want to hear how a disturbing recent turn of events may be affecting these programs. Specifically, the action the general counsel of the Equal Employment Opportunity Commission (EEOC) is taking. 

“The general counsel sought an injunction against Honeywell, making the argument that any sort of premium discount the company offered to its employees for participation in the company wellness program made that participation—in this case data collected through a wellness screening—involuntary. 

“The EEOC’s general counsel seems to think there is confusion between what the Affordable Care Act said and his interpretation of the Americans with Disabilities Act. 

“That would mean that an employer could not give premium discounts as envisioned by Obamacare. 

“Honeywell has a wellness program that is reportedly compliant with Obamacare, provides for reasonable alternative accommodations, and protects patient privacy.  And, it’s working to improve employee health: 61 percent of Honeywell employees identified with more than one health risk factor eliminated at least one of those risk factors; and 46 percent eliminated all of their risk factors. 

“Even the White House has expressed concern regarding the EEOC’s actions.  In December, when asked about the president’s thoughts on the EEOC wellness lawsuits, White House Press Secretary Josh Earnest said the administration is concerned EEOC’s actions are, or could be, “inconsistent with what we know about wellness programs and the fact that we know that wellness programs are good for both employers and employees.” 

“Congress was clear in the health care law.  The administration was clear in the regulations of that law.  And the White House has again reiterated its support for these programs.  But apparently that is not clear enough for the EEOC. 

“EEOC is sending a confusing message to employers—reliance on Obamacare’s authorization of wellness programs does not mean you won’t be sued. 

“If the general counsel persists, I will work on legislation to provide clarity to the General Counsel of the EEOC that employers and employees can continue to offer these voluntary wellness programs and encourage healthy lifestyle choices.  

“Innovation and healthy choices should be applauded, not punished.

“Workplace wellness programs give individuals some control over rising health care costs.  Instead of watching powerlessly as more money comes out of their paychecks each month to cover rising health insurance premiums—wellness programs give individuals the ability to regain some control over those costs.” 

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