A Wisconsin federal court has now given a clean bill of health to employer-sponsored wellness programs requiring medical examinations as a condition of enrollment in the employer’s health insurance plan.
In EEOC v. Flambeau, Inc., the employer established a wellness program that required employees enrolling in the employer’s health plan to complete the wellness program’s health risk assessment and a biometric test. The risk assessment included a questionnaire about the employee’s medical history, diet, mental health, social wellbeing, and job satisfaction. The biometric test was similar to a physical examination in that it recorded the employee’s height, weight, blood pressure, and required a blood draw.
None of the specific results were given to the company. Instead, the information gathered was used by the program administrators to identify health risks and medical conditions among the workforce participants.
One of the employees failed to complete the wellness program’s test and therefore was dropped from the medical plan. The employee filed a union grievance, a complaint with the Department of Labor (DOL) and a disability discrimination charge with the Equal Employment Opportunity Commission (EEOC). The employer and the DOL settled the dispute by agreeing that the employee could be reinstated retroactively to the health insurance plan if he complied with the plan’s testing obligations and paid the required plan premiums.
EEOC Claims Subterfuge
Nevertheless, the EEOC sued the company contending that the program violated the Americans with Disabilities Act (ADA) ban on employer-mandated medical examinations. The employer countered that the wellness program fell within the ADA’s safe harbor for insurance benefit plans, which allows employers to establish and administer the terms of a benefit plan for purposes of underwriting, classifying, or administering risks, and that the wellness program constituted a term of its benefit plan.
Federal District Court Judge Barbara Crabb concluded that the wellness requirement was a term of the employer’s health plan and that it was intended for the purposes authorized under the ADA’s safe harbor provision. The court was heavily influenced by evidence that the data derived from the wellness program was utilized by consultants to forecast insurance costs, determine whether to purchase stop-loss insurance, and set plan premiums for participants, with differentials for whether the participants was a tobacco user or not.
In particular, Judge Crabb rejected the EEOC’s contention that the plan was a subterfuge for the employer’s desire to illegally collect employee medical information. The judge explained that the ADA does not prohibit the collection of such information and that a benefit plan requirement is not a subterfuge unless it involves a “disability-based distinction” that is used to discriminate against disabled individuals. In this instance, no such distinction existed since all employees seeking insurance had to supply the wellness program data and there was no evidence that such data was used to make disability-based decisions regarding employees’ benefits.
Bottom Line
The EEOC has not been as successful as they would have hoped in challenging wellness programs as violations of the ADA. We can expect, however, that they will continue to challenge such plans if they perceive that employees are compelled to divulge medical information that they otherwise would wish to keep confidential. We may also see EEOC regulations sometime in the future as an alternative method of imposing greater uniformity upon employers.
For more information, please contact Michael McNally at mmcnally@felhaber.com.