Participatory
wellness programs require only that employees
participate in the activities required by the employer. Examples of participatory wellness programs
might include attending regular wellness seminars. By contrast, health contingent wellness programs are those that require
employees to reach certain milestones, like smoking cessation or body mass
index goals.
The new regulations increase the maximum
incentives that may be provided by employers, although few employers are near
these maximums today. The maximum
permissible reward under a health contingent wellness program is increased from
20% to 30% of the cost of coverage. The
maximum permissible reward for programs designed to prevent or reduce tobacco
use is increased to 50%.
HHS indicated that the regulations are also
designed to protect consumers by requiring that these programs be reasonably
designed, uniformly available to all similarly-situated individuals, and
accommodate recommendations made at any time by an individual’s physician based
on medical appropriateness. These
accommodations include reasonable alternatives offered for those individuals
who are unable to achieve the desired wellness results.
The regulations also ensure that programs
are not overly burdensome and do not result in discrimination based on a health
factor.
According to the comments to the
regulations, the intention of the Departments is that every individual
participating in the program should be able to receive the full amount of any
reward or incentive, regardless of any health factor.
The agencies indicated that they anticipate
issuing future guidance to provide clarity and modifications to these final rules.
If you would like additional information on
the specific requirements of the new rule or on wellness programs in general,
please contact Thomas N. Hutchinson at (317) 238-6254.