AARP is taking the Equal Employment Opportunity Office to court over wellness initiatives that it claims discriminate against seniors.
At issue is a rule the EEOC approved in May that allows employers to offer financial incentives to employees who participate in wellness programs. The rule also stipulates that the incentive cannot be worth more than 30 percent of the total cost of an employee health plan.
Critics of the rule don’t see such programs as rewarding participants as much as punishing non-participants with higher premiums.
Although all wellness programs must be voluntary, critics argue that the difference in cost between participating and not participating is so great for employees that the wellness program is in practice non-voluntary.
For a bit of context, the average cost of an employee health plan is $6,435 a year, according to an analysis by the Kaiser Family Foundation. Thirty percent of that would be roughly $2,000.
Employees are being pressured, AARP argues, to hand over sensitive medical information to employers through biometric screenings or medical questionnaires that are performed at the workplace.
Employers have insisted that they put in place measures to protect the privacy of participating workers, whose medical information is often handled by a wellness vendor that the employee has contracted with. The worker’s boss is never supposed to handle the information or be provided with medical information about individual employees.
James Gelfand, senior vice president for health policy for the Erisa Industry Committee, told the New York Times that there was “no evidence” of employees being discriminated against as a result of wellness screenings.
In its suit filed with the Federal District Court in the District of Columbia, AARP asks the court for a preliminary injunction to stop the rule from going into effect in 2017.
Before it announced its new rule in May, the EEOC had often been the one challenging employers for wellness programs that it deemed punitive to non-participants.
A federal judge ruled last month in favor of a company, Orion, whose wellness incentive the EEOC had alleged went too far. In the case of Orion, employees who did not complete a health risk assessment were told they would have to pay the full cost of their premium.
The debate over wellness puts the Obama administration in an awkward spot. On one hand, it pushed for wellness initiatives as part of the Affordable Care Act, believing it was an important way to make people healthier and thus reduce health costs. On the other hand, Democrats are sympathetic to concerns about discrimination, as well as emerging research that suggests wellness programs do not produce the financial savings they have promised.