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EEOC Removes Wellness Incentive Rules from Final Regulations

In August 2017, a federal judge ruled that the Equal Employment Opportunity Commission (EEOC) must reconsider its rules regulating employee wellness programs.

Initially, the federal judge did not vacate the EEOC’s wellness rules, so the rules remained in effect until the EEOC issued revised rules. The EEOC anticipated issuing proposed rules in August 2018, and final regulations in October 2018, with an effective date in early 2021.

In early 2018, the judge, in agreeing with AARP who brought the case against the EEOC, granted AARP’s motion to vacate the EEOC’s wellness rules, effective January 1, 2019, if the EEOC did not issue revised rules before that date.

Ultimately, the EEOC did not issue any proposed or final wellness rules in 2018, so the rules were removed from the final regulations in December 2018. However, the Fall 2018 Unified Agenda of Federal Regulatory and Deregulatory Action shows plans to issue new proposed regulations in June 2019.

While this is a minor win in the interim for employer groups seeking more flexibility in developing its wellness plan, it is important to note that existing wellness compliance obligations under HIPAA and the ACA remain in place unaffected by the federal judge’s ruling. Similar to the EEOC’s wellness rules, HIPAA and the ACA’s requirements also institute incentive limits (albeit less stringent) and wellness program participation requirements. Additionally, employers must plan ahead for the forthcoming proposed EEOC wellness rules which could eliminate or impose different guidelines on incentives limits.

For an overview of the HIPAA, ACA, ADA, and GINA wellness program compliance rules, please visit Wellness & Value-Add Benefits: No Good Deed Goes Unpunished.