• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Facebook
  • Instagram
  • LinkedIn
  • Twitter
  • YouTube
Big Ideas for Small Business logo

Barbara Weltman

Big Ideas for Small Business, Inc.

Whitepaper download

Subscribe and download our eBook, "150+ Tax Deductions for Small Business A to Z."

This field is hidden when viewing the form
Get the:

  • Home
  • About Us
  • Big Ideas For Your Business
    • Idea Of The Day ®
    • SMB Legal
    • SMB Taxes
    • SMB Financial
    • Small Business
    • Newsletter Archive
  • Services
  • Books
  • Blog
  • Multimedia
    • Videos
    • Radio Shows/Podcasts
  • Be a Guest Blogger

Wellness Programs — What You Need to Know

May 28, 2015 / By Barbara Weltman

Follow @BarbaraWeltman

© <a href="http://www.dreamstime.com/brezra_info#res188443">Brezra</a> | <a href="http://www.dreamstime.com/#res188443">Dreamstime.com</a> - <a href="http://www.dreamstime.com/stock-illustration-healthy-people-logo-active-body-fit-symbol-natural-wellness-center-vector-icon-design-illustration-fitness-concept-image53572648#res188443">Healthy People Logo, Active Body Fit Symbol And Natural Wellness Center Vector Icon Design. Photo</a>The person who coined the saying that “no good deed goes unpunished” must have had wellness programs in mind. Companies that want to encourage employees to maintain good health can adopt wellness programs. However, unless these programs conform to government requirements, companies can be exposed to government penalties or employee lawsuits. So what do you do?

Background

Many employers have long supported wellness programs. In the old days (pre-Affordable Care Act, or ACA), rules regarding wellness programs were less cumbersome than they are now. ACA introduced incentives for employers to encourage good health, and government regulations followed.

The incentives, or disincentives, allowed under ACA include discounts or rebates of premiums paid by employees toward employer-provided health coverage. The maximum permissible reward or penalty under a health-contingent wellness program offered in connection with a group health plan is 30% of the total annual premiums for individual-only coverage. For example, if the total annual cost of coverage paid by both the employer and employee for self-only coverage is $5,000, the maximum incentive for an employee under a wellness plan is $1,500. The maximum permissible reward or penalty is 50% of the premiums for individual coverage premiums for wellness programs designed to prevent or reduce tobacco use.

The DOL says wellness programs must meet all of the following conditions:

  • Programs must be reasonably designed to promote health or prevent disease. To be considered reasonably designed to promote health or prevent disease, a program must offer a different, reasonable means of qualifying for the reward to any individual who does not meet the standard based on the measurement, test or screening. Programs must have a reasonable chance of improving health or preventing disease and not be overly burdensome for individuals.
  • Programs must be reasonably designed to be available to all similarly situated individuals. Reasonable alternative means of qualifying for the reward have to be offered to individuals whose medical conditions make it unreasonably difficult, or for whom it is medically inadvisable, to meet the specified health-related standard.
  • Individuals must be given notice of the opportunity to qualify for the same reward through other means.

 Final rules on incentives for nondiscriminatory wellness programs can be found here.

Latest development

 Last month the Equal Employment Opportunity Commission (EEOC) released proposed regulations defining the term “voluntary” with respect to disability-related questions and medical exams. This clarification is necessary because such inquiries and exams could arguably run afoul of the Americans with Disabilities Act (ADA), which  generally prevents employers from asking disability-related questions or requiring employees to undergo medical tests; the ADA has an exception if questions and exams are “voluntary.”

So the requirements above cannot violate the ADA and won’t if they meet these additional requirements (assuming the proposed rules are adopted):

  • A wellness program that collects information on a health risk assessment to provide feedback to employees about their health risks, or that uses aggregate information from health risk assessments to design programs aimed at particular medical conditions is reasonably designed. A program that collects information without providing feedback to employees or without using the information to design specific health programs is not.
  • Employers also may not interfere with the ADA rights of employees who do not want to participate in wellness programs, and may not coerce, intimidate, or threaten employees to get them to participate or achieve certain health outcomes.
  • Medical information obtained as part of a wellness program must be kept confidential. Disclosure cannot violate the ADA or the Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule.
  • Employers must provide reasonable accommodations to enable those with disabilities to participate in a wellness program.

Note: Public comments can be made through June 19, 2015. Find details about submitting comments here (see “addresses and supplemental information”).

Should you use wellness programs?

Very small employers likely won’t want to contend with the hassle of offering wellness programs, despite their supporting the concept of improved employee health. Small employers may find other, less formal, ways to encourage wellness (e.g., healthy snacks in the coffee break room, company softball teams). However, larger companies will have to weigh the benefits of wellness programs against the hassle of offering them.

Tags ACA Affordable Care Act Americans with Disabilities Act (ADA) government regulations wellness programs

Primary Sidebar

Categories

  • General Business (506)
  • Guest Blog (113)
  • Homepage (23)
  • Small Business (1,003)
  • SMB Financial (329)
  • SMB Legal (66)
  • SMB Taxes (326)

Barbara’s Recent Posts

  • Mid-Year Business Planning for 2025 July 1, 2025
  • 10 Ideas for Coping with Cash Flow Challenges June 26, 2025
  • 5 Insurance Traps to Avoid June 24, 2025
  • Creating a Feng Shui Office Layout for Your Business June 20, 2025
  • Scaling Your Business by Optimizing Social Media Marketing June 19, 2025
  • The Timeless Value of Business Cards in a Digital World June 18, 2025
  • What Does the Latest IRS Data Book Tell Us? June 17, 2025
  • Business Advice from Famous Dads June 12, 2025
  • How Important Is Higher Education for Small Business Owners June 11, 2025
  • Business Planning in a Period of Uncertainty June 10, 2025
  • 9 Smart Financial Decisions for Business Owners in Retirement June 6, 2025
  • Preview of Tax Changes this Year: Actions to Take Now June 5, 2025
Awarded Top 100 Small Business Blog medal (link will open in a new window or tab)
Marquis Who's Who 2023 Badge
Top Small Business Blogs (Link will open in a new window or tab.)
8 Financial blogs small business Owners Need to Read. Invoice home.  (link will open in a new window or tab)
Best Small Business Blog, Expertido.org
Top 50 Small Business Blogs 2018
Best Small Business Blogs
BizHumm Top 100 Business Blog Award to Barbara Weltman
FitsSmallBusiness.com: Award for Best Small Business Blog 2017 (link will open in a new window or tab)
FitsSmallBusiness.com: Award for Best Small Business Blog 2016 (link will open in a new window or tab)

Footer

Big Ideas for Small Business logo

Small business ideas, business tax news and small business consulting from Barbara Weltman to provide business owners with the information they need to succeed. Visit our small business blog, Idea of The Day®, small business books and articles on small business taxes, small business finance and small business legal advice.

Contact Us

[email protected]

(772) 492-9593

gacor maxwin situs slot thailand terpercaya situs slot gacor situs gacor akun pro thailand slot bandar togel terpercaya

Latest Tweets

bigideas4sb Big Ideas for Small Business® @bigideas4sb ·
July 2

Cash App, Zelle and Beyond: How to Choose a Money Transfer App https://bit.ly/3G9LEeq

Reply on Twitter 1940524229482402032 Retweet on Twitter 1940524229482402032 1 Like on Twitter 1940524229482402032 1 Twitter 1940524229482402032
bigideas4sb Big Ideas for Small Business® @bigideas4sb ·
July 2

Listen Before You Ask, Business & Personal

Reply on Twitter 1940509951228891259 Retweet on Twitter 1940509951228891259 1 Like on Twitter 1940509951228891259 1 Twitter 1940509951228891259
bigideas4sb Big Ideas for Small Business® @bigideas4sb ·
July 2

Mental Clarity: The Most Underrated Key to Business Growth During Tough Times https://bit.ly/443P627 #smallbusiness #leadership

Reply on Twitter 1940461314708492485 Retweet on Twitter 1940461314708492485 Like on Twitter 1940461314708492485 Twitter 1940461314708492485
Load More

Copyright © 2008–2025 Big Ideas for Small Business, Inc  |  Designed by Hudson Fusion

  • Privacy Policy
  • Sitemap