Employer Wellness Rules Bar Health Discrimination

Final employer wellness rules issued this week by the Obama administration make one thing very clear: wellness programs must not be “a subterfuge for discriminating based on a health status factor.” Under these rules, the maximum penalty an employer can impose for not meeting wellness goals rises from 20% to 30% of an employee’s medical plan costs. In the case of smoking cessation, the penalties can be as high as 50%.

Wellness ranks right up there with apple pie and motherhood — very popular. But employer wellness rules flowing from the Affordable Care Act have been very controversial. The beauty of these programs is definitely in the eye of the beholder.

Employers see an opportunity to hold employees accountable for improving their health. Patient advocates see a back door to discrimination against people with chronic diseases and a way to bring back higher insurance rates for pre-existing conditions.

In a nutshell, the new rules protect people with chronic diseases, like obesity, from a one-size-fits-all standard that imposes penalties. Employers are required to provide reasonable alternatives that take into account an employee’s medical status.

Patient advocates generally like this. Business groups are less enthusiastic.

Says Ron Pollack, Executive Director of Families USA, ““These rules will help ensure that wellness programs are designed to actually promote wellness, and that they are not just used as a back-door way to shift health-care costs to those struggling with health problems.”

Helen Darling, Executive Director of the National Business Group on Health, sees the rules differently. “We think this is pretty restrictive because it adds a burden they don’t really need.” She and other business representatives see these rules as a deterrent to implementing wellness programs.

But the most intriguing aspect of the rules lies in provisions that give an employee’s doctor the final say. The rule says that an employer “must provide a reasonable alternative standard that accommodates the recommendations of the individual’s personal physician.”

According to patient advocate Morgan Downey, this provision could conceivably lead employers with programs that target obesity to cover obesity drugs or surgery if recommended by an employee’s doctor.

That would be a welcome change. For all their talk of concern about obesity, many employers have been slow to cover the cost of treatment in their health plans.

Click here to read more in the Downey Obesity Report, here to read more in the Washington Post, here to read more in the New York Times, and here to read the rules.

Woman in Small Ghana Shop © Arne Hoel, The World Bank / flickr

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