The Department of Labor's Equal Employment Opportunity Commission (EEOC) has been hard at work on financial incentives in employer wellness programs. Its most recent task was to issue a new regulation proposed under the Genetic Information Nondiscrimination Act (GINA). It offers a much-desired clarification of GINA's scope, but it also brings additional complexity—that is, if the regulation applies in the first place.

What the Proposed Regulation Does and Does Not Address

The EEOC's new GINA wellness regulation is very, very narrow in its scope. Among other things, GINA prohibits offering financial inducements (incentives) to acquire an employee’s genetic information. GINA defines "genetic information" to include medical history of an employee’s "family member," which in turn is defined to include, rather curiously, the employee’s spouse. Thus, the EEOC reasons, under the strict terms of GINA, offering an incentive to a spouse to complete a health risk assessment or undergo biometrics violated GINA because the spouse's health information is considered genetic information of the employee. The recently proposed regulation loosens that restriction a bit so that a wellness programs with financial incentives can include health risk assessments in which both the employee and his/her spouse can participate. To illustrate:


The main idea here is that the proposed regulation does not change the current requirement that health risk assessments be bifurcated, separating the incentive from the family medical history. Also, note that EEOC's jurisdiction is triggered not by the wellness program or the incentives provided under it, but rather by the health risk assessment. The ADA is implicated by the employee's participation in the health risk assessment because it is considered a disability-related inquiry. GINA is implicated because the health risk assessment includes a request for the employee's family medical history, which is considered genetic information. So long as there is no incentive provided for the family medical history part of the health risk assessment, the wellness program doesn't violate GINA.

This is all old news, though. The EEOC's proposed GINA wellness regulation does not implicate the very common scenario in which an employer offers a health risk assessment to employees only and not their spouses.



Without the new EEOC regulation, a wellness program that provides incentives and has a health risk assessment in which both employees and their spouses can participate would violate GINA. This is the only scenario addressed by the proposed regulation.



The proposed regulation addresses this by allowing a narrow exception. The strings that come tied to this regulatory exception are somewhat complex, and some employers may find them too constricting, opting instead to either abandon spousal health risk assessments or tie the wellness incentive only to the employee's participation and not the spouse's.

Strings Attached (if the Regulation Applies in the First Place)

The proposed regulations clarify that GINA does not prohibit an employer from offering incentives for the provision of information by a spouse as part of an health risk assessment, as long as the following requirements are satisfied:

1. The participating individual (that is, the employee and the spouse) signs a consent form that describes both the types of information being requested and the applicable restrictions on the employer’s use of such information.
2. The employee must be enrolled in either employee+spouse or family health coverage provided by the employer.
3. The health information of both the employee and the spouse must be provided in connection with a wellness program health risk assessment.
4. No incentives are provided for health information about the employee's biological children, adopted children or stepchildren.
5. If an incentive is given for the spouse's health information (which is deemed genetic information of the employee), then the total wellness financial incentive must be apportioned between the employee and spouse, subject to limits.

Incentive Limit and Apportionment

The fifth requirement above is the most frustrating because it is not at all congruent with the wellness regulations under HIPAA and the ACA. The figure "30%" gets used a lot, but what's important to realize is that EEOC's GINA incentive limit is actually a two-step analysis that uses the same percentage two different ways.

First, where there is an incentive tied to both the employee's and spouse's health information, the proposed rule limits the total inducement related to health status information to 30% of the total cost of the plan in which the employee and any dependents are enrolled. This is different than the EEOC's ADA wellness regulation, which limits the incentive tied to a health risk assessment in which only the employee participates to 30% of the total cost of self-only coverage, regardless of the coverage tier in which the employee is enrolled. Both of these machinations of the 30% limit differ from HIPAA's and the ACA's 30% limit.

Second, in addition to the combined employee and spouse incentive limit, the proposed GINA wellness regulation embeds a second 30% limit on any inducement specific to the employee. This embedded limit is equal to 30% of the cost of self-only coverage, regardless of which coverage tier in which the employee and his/her spouse are enrolled.

For example, if the total cost of employee-only coverage is $6,000 and family coverage is $14,000, then the wellness incentive (again, assuming the wellness program includes a health risk assessment in which both the spouse and the employee must participate) could not be more than $4,200 for the family as a whole (30% of $14,000), and the embedded limit for any incentive specific to the employee's participation is $1,800 (30% of $6,000). The remaining $2,400 ($4,200 minus $1,800) could be apportioned to the rest of the family for other wellness incentive purposes, including to the employee for other wellness-related activities (such as a heart walk or cancer run or participating in a seminar, etc.).

Keep in mind that this special limit and apportionment rule applies only to health risk assessments—specifically health risk assessments in which a spouse participates. Employers could have wellness incentives that are not related to health status information, and these rules won't apply to those incentives.