Employers May Want to Consider Relying on ADA's Safe Harbor Provision in Establishing Wellness Programs

24 October 2012 Labor & Employment Law Perspectives Blog

It’s no secret employers want to keep health care costs at manageable levels. In recent years, many employers have incorporated wellness programs into their employee insurance plans as a way to do just that. Examples of wellness programs could include nutrition counseling, cholesterol and other health care testing, flu shots, or smoking cessation programs. Employers must be careful when starting wellness programs not to violate the Americans with Disabilities Act (ADA) by requiring employees to take a medical examination or “mak[ing] inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.” But the analysis does not end with that provision, as the ADA contains a “safe harbor” provision that allows covered entities to establish, sponsor, observe, or administer “the terms of a bona fide benefit plan” that are based on risks.

The safe harbor provides a pathway for employers to establish and implement a wellness program as part of their health benefit plans. In one very recent example, a federal appeals court upheld an employer’s wellness program because it fell within the protection of the safe harbor. There, the employer established a wellness program consisting of two parts: (1) a biometric screening; and (2) an online health risk questionnaire. While employees were not required to participate in the wellness program, the employer imposed a recurring charge to employees who enrolled in the health plan but refused to participate in the wellness program. The court held that the safe harbor protected the employer’s practice.

While the above-mentioned case is but one example, it demonstrates the ability for employers to rely on the ADA’s safe harbor provision in establishing and implementing cost-saving wellness programs.

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