Employment Law FAQs

Do Wellness Programs Violate HIPAA Requirements?

Employers have a vested interest in promoting healthy lifestyles among their employees, not only to reduce the number of days employees miss due to illness, but also to lower the costs of employers' share of expenses in group health plans. While insurance providers may not impose higher premiums on individual employees based on health factors, insurance providers are permitted to impose higher group premiums on employers who have employees with higher adverse health factors.

"Health factors" include an individual's health status, physical and mental health condition, history of filing claims, history of past health care, medical history, genetic information, disability and evidence of insurability (such as domestic violence acts and participation in high risk activities, like sky-diving, motorcycling and skiing, for example)

Consequently, many employers have begun promoting healthy lifestyles through various wellness programs that include everything from encouraging preventative care to promoting quit-smoking programs. These programs do not violate HIPAA nondiscrimination requirements so long as employees are not required to meet a standard related to a health factor in order to receive a reward or benefit from the program. Thus, a program that encourages smokers to quit smoking cannot base the availability of employer reimbursement for the program's costs on whether the employee actually is able to quit smoking.

Some examples of other wellness plans include:

Reimbursing enrollment costs in a gym or fitness center
Offering a reduction in the monthly insurance premiums for completing a health assessment in which the reduction is based on completing the assessment and not on the results of the assessment
Offering a reward for employees who attend monthly or quarterly seminars focusing on health and exercise

If certain conditions are met, HIPAA will permit wellness programs that condition receiving the reward on an individual's satisfaction of a standard related to a health factor. In order for this type of wellness program to be legal, it must meet five criteria:

The total award cannot be more than 20% of the employee's costs for cover under the plan
The program must be constructed to promote health
Employees who are eligible to participate in the program must be given the opportunity to do so at least once per year
The reward must be available to all similarly-situated employees and the program must provide alternatives or waivers to any individuals unable to participate in the program for the reward because of a medical condition or medical prohibition against participation
The availability of a waiver or alternatives for those unable to participate for medical reasons must be disclosed in all materials discussing the terms and conditions of the wellness program

If the employer's wellness program does not have a reward for participation or completion of certain activities, the program is permissible under HIPAA so long as it does not violate any of HIPAA's antidiscrimination provisions. HIPAA prohibits discrimination against individuals seeking to enroll in a group health care plan, who exercise their rights under the plan or who seek continued coverage under the plan based on their individual health factors. For example, a group health plan insurer may not prevent an employee from enrolling in the plan because he or she has a disability or because he or she is currently confined in a hospital, nursing home or other care facility.

For more information on wellness programs, state and federal requirements or other employment legal matters, contact an experienced employment law attorney in your area.

DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent counsel for advice on any legal matter.

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