Employees battle health insurance screenings that cost some workers

In the absence of clear federal rules on how employers can incentivize health insurance programs, a lawsuit filed by Yale University employees sheds light on the measures that penalize some workers.

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Like many large employers, Yale University has given its clerical, food service and maintenance workers a choice: undergo a routine health checkup or pay a weekly fee of $25.

But the workers alleged in a federal lawsuit that the university’s employee welfare program participating or paying violated two federal laws. In a preliminary settlement approved by the U.S. District Court in Connecticut on Tuesday, the university agreed to pay nearly $1.3 million to workers and attorneys and will not assess the $25 weekly fee for four years, or until federal law or regulations change to permit such program. .

Lawyers will have 45 days to notify approximately 6,300 eligible workers and their spouses of the terms of the settlement. A hearing to approve the final settlement is scheduled for November 22.

For more than a decade in corporate America, employers have promoted wellness programs that help workers quit smoking, lose weight or change unhealthy behaviors. Often administered by third-party vendors, the programs persuade employees, through financial incentives or penalties, to submit to biometric tests that typically include a blood test to check for cholesterol, diabetes, and blood pressure. arterial.

Employers love these plans because they encourage workers to maintain their health and take action before chronic health conditions develop or worsen. Proponents say these plans can limit rising healthcare costs, boost productivity and reduce absenteeism.

But some workers say the wellness programs are anything but voluntary, charging workers higher premiums if they don’t participate.

The Americans with Disabilities Act prohibits employers from imposing medical demands or questioning a worker’s health unless those demands are job-related. But the law allows a loophole for wellness programs and health screenings that are voluntary.

Among large employers, 83% offered employees a wellness program that included at least one of the following: smoking cessation, weight management, and behavioral or lifestyle coaching, according to the 2021 Kaiser study Family Foundation. annual profit survey.

Half of large employers had biometric screening programs for workers in 2020, but that figure fell to 38% last year, according to the Kaiser survey. However, that could have been a temporary drop because companies didn’t want to force workers to perform such screenings during the COVID-19 pandemic, said Matthew Rae, associate director of the Kaiser Family Foundation.

Lawyers representing Yale workers said the settlement is a powerful example of employers’ limitations when implementing wellness programs.

“Our position is not that wellness programs are bad or shouldn’t be offered to employees,” said Elizabeth Aniskevich, an AARP Foundation attorney representing Yale employees. “We hope employers will take note of this regulation and rethink the imposition of fees in association with a wellness program.”

EEOC delays rule update

In 2016, the Federal Equal Employment Opportunity Commission issued guidelines allowing employers to assess opt-out fees at up to 30% of the total cost of an individual’s health insurance coverage. . AARP sued the federal agency, arguing that the charges were not voluntary and violated the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act. A federal court agreed and ordered the EEOC to write new regulations.

The EEOC submitted rules for public comment in January 2021, but withdrew the proposal about two weeks later. An EEOC spokesperson said the agency has not updated the rules for employers since then.

“Employee participation in employer wellness programs must be voluntary,” EEOC spokesman Victor Chen said in an email. “To make sense of this requirement, the incentives for participation cannot be substantial enough to be coercive.”

As part of its settlement, Yale also agreed to no longer transfer workers’ personal health information to a third-party provider to facilitate health coaching without an employee’s consent, said Dara Smith, senior attorney for the AARP Foundation.

Smith said the settlement is an ideal model for employers to follow because it doesn’t financially punish workers who don’t participate. It also gives control to workers who can choose whether or not to share their screening results with a provider to access health coaching.

“Our position is that any sanction renders the program non-voluntary,” Smith said. “It means you volunteer to do it. You are not trying to avoid punishment.

Voluntary wellness plans?

Six city workers sued the city of Chicago in 2020, claiming the city’s wellness program violated federal law by requiring employees and spouses to share personal health information and perform health screenings or to pay an extra $25 for health coverage every two weeks. The city has suspended the fees since the lawsuit was filed, said Allison Muth, an attorney representing the workers.

NASCAR offered employees the choice of taking a health check or paying an extra $125.

Employees could get tested in May at on-site clinics held at company offices in Daytona Beach, Florida, or Charlotte, North Carolina, or make an appointment at a Quest lab office, a doctor’s office or complete a home test kit.

A memo sent to NASCAR employees, obtained by USA TODAY, describes its biometric screening program as mandatory even though workers can opt out and pay extra.

“If you are enrolled in the NASCAR medical plan, screenings are mandatory,” the NASCAR memo reads. “Employees who complete screening will receive four hours of wellness (paid time off). A one-time supplement of $125 will be applied to those who do not participate.”

NASCAR officials declined to answer USA TODAY’s question about its wellness program. However, a NASCAR official told the Orlando Business Journal the motor racing organization uses the data from the projections to develop its wellness programs.

A NASCAR official told the publication that the program helps workers with chronic conditions and manages the organization’s health care costs.

Smith, the AARP Foundation’s attorney, reviewed NASCAR’s marketing materials and noted key differences from the Yale case. Yale’s program charged up to $1,300 per year for non-participants and offered no incentives for those wishing to complete the program. NASCAR is offering four hours of paid time off to workers who fill out the wellness screen. However, such an incentive can be interpreted as a penalty for people who don’t participate, Smith said.

“The best way to ensure a program is voluntary is to treat participating and non-participating employees exactly the same – except that those who do participate can reap the benefits of the program themselves,” said Smith.

Employer health benefits consultants say wellness programs are typically designed to protect workers’ private medical information. Vendors may have access to individual employee claims data, but this personal health information is not shared with the employer.

“An employer would not be allowed to have (employee) personal health information,” said Steven Noeldner, a senior consultant at benefits consultancy Mercer and an expert on employer health plans. “This type of information is always collected by a third party.”

However, companies have access to vast categories of data that can help them customize a program. For example, if the employer is spending more on claims for employees with lower back, knee or hip pain, they may choose to pay for programs that help workers take steps to reduce their risk. to suffer from such ailments.

Workers who undergo biometric screening may receive a report from their employer’s wellness provider about their health status, which may include counseling or referrals to lifestyle coaching to address health issues.

The most common incentive is insurance discounts for those who perform biometric checks, Noeldner said. For workers who aren’t covered by an employer’s insurance plan, employers may offer other incentives like cash or gift cards. Employers can also include other ways to reward workers. Plans can also incorporate tracking devices, such as Fitbits, used to reward workers for walking or swimming a set amount.

“It’s presented as an incentive and a positive thing for those who choose to participate,” Noeldner said.

Ken Alltucker is on Twitter at @kalltucker, or can be emailed at [email protected]

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