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June 8, 2009

Health Risk Assessments: Where Do They Stand?

One of the tools commonly used in a wellness program is a health risk assessment.  A health risk assessment can take many forms.  Generally, it involves the collection of personal medical information, which may include family medical history and genetic information.  The purpose of the information collection is generally to target medical conditions that an individual may have, or may be predisposed to have; the goal being, of course, to address the condition before it gets out of hand. 

While wellness programs are being contemplated by virtually all of the health care reforms being proposed, how they can be administered within the strictures of the law remains an open question. 

The recently enacted Genetic Information Nondiscrimination Act of 2008 (GINA) restricts the use of family medical history and genetic information for purposes of eligibility and rating purposes, except to the extent that it is based on a manifest condition.  Plans are also prohibited from altering a premium or contribution amount based upon an individual’s genetic nature. GINA appears to allow voluntary health risk assessments.  The outstanding question is, “What does voluntary mean?”  The GINA proposed regulations posed this question; hopefully, the final regulations will provide some guidance. 

Recently, the Equal Employment Opportunity Commission (EEOC) issued an informal, non-binding opinion relating to a mandatory health risk assessment.  In the scenario at hand, participation in the health plan was contingent upon completing a health risk assessment.  According to the EEOC’s informal position, this kind of arrangement violates the Americans with Disabilities Act (ADA), another law that limits how medical information can be used.  According to the EEOC, making eligibility for health coverage contingent upon completing a health risk assessment is an impermissible use of medical information, in contravention of the ADA. 

The EEOC seems to be leaning toward relying on the Health Insurance Portability and Accountability Act of 1996 (HIPAA) nondiscrimination rules for guidance.  HIPAA prohibits group health plans from discriminating against individuals based on health-status related factors, such as current or prior medical conditions, claims experience, etc.  HIPAA’s nondiscrimination rules specifically address wellness programs, in the following ways.  If a wellness program is outcome-based (dependent upon achieving a goal), then the program must meet five criteria; they are:

  1. The reward, taken together with all rewards from other wellness programs, cannot exceed 20% of the cost of single coverage; or, if the wellness program is made available to the family, then the cost of the relevant coverage (for example, full family, or individual + one);
  2. The program must be reasonably designed to promote health or prevent disease, and cannot be overly burdensome.  The program cannot be designed in a way that would cause it to be suspect, or be a subterfuge to evade the purposes of the law;
  3. The program must give individuals the ability to qualify for the program, at least once annually;
  4. The program must be available to all individuals with alternative methods of compliance made available for those who cannot comply because of health reasons; and 
  5. In any plan material that describes wellness programs, the availability of alternative standards must be described.

These are but a few of the matters that must be grappled with in resolving what role health risk assessments play in wellness program design.

 

The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations.

As required by U.S. Treasury rules, we inform you that, unless expressly stated otherwise, any U.S. federal tax advice contained in this Benefit Beat is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service.

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