Nancy Grover

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at riskletters@lrp.com.

Regulatory Guidance

EEOC Seeks to Clarify Wellness Programs, ADA

A proposed rule from the EEOC is intended to help clear up questions surrounding wellness programs and potential conflicts with the ADA.
By: | May 21, 2015 • 5 min read
Doctor measuring blood pressure

Employers seeking guidance on implementing workplace wellness programs without violating the law may get some help. The Equal Employment Opportunity Commission has issued a proposed rule on how Title I of the Americans with Disabilities Act applies to wellness programs that are part of group health plans. The agency is accepting public comments through June 19.

“The EEOC’s proposed rule makes clear that wellness programs are permitted under the ADA, but that they may not be used to discriminate based on disability,” according to a statement on the EEOC’s website. “The rule explains that under the ADA, companies may offer incentives of up to 30 percent of the total cost of employee-only coverage in connection with wellness programs. These programs can include medical examinations or questions about employees’ health (such as questions on a health risk assessment).”

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The rule says the programs must be voluntary and employers cannot deny health insurance, reduce health benefits, or discipline those who do not participate. Employers cannot interfere with the ADA rights of those who do not participate, and they must provide reasonable accommodation to disabled employees that allow them to participate in wellness programs and earn the incentives the employer is offering.

The programs “must have a reasonable chance of improving health or preventing disease in participating employees,” the EEOC said. “A 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.”

Finally, employers are only entitled to medical information collected for the wellness program in aggregate form. The employee’s identity must be kept confidential.

“I absolutely think this guidance is needed because employers were left in legal limbo with what to do,” said Ilyse Schuman, shareholder with Littler and cochair of the Workplace Policy Institute. “On one hand, the Affordable Care Act provisions are designed to promote [wellness programs]; at the same time, the EEOC had taken some recent enforcement action challenging the use of incentives in connection with wellness under the EEOC and the Genetic Information Nondiscrimination Act.”

In one case, the agency said an employer violated federal law by requiring an employee to “submit to medical exams and inquiries that were not job-related and consistent with business necessity as part of a so-called ‘wellness program,’ which was not voluntary, and then by firing the employee when she objected to the program,” according to court documents. It said the company’s wellness program “required medical examinations and made disability-related inquiries.”  When an employee declined to participate, the company “shifted responsibility for payment of the entire premium for her employee health benefits” to the worker and shortly thereafter fired her.

In a separate case, the agency said an employer threatened to penalize employees if they or their spouses did not submit to biometric tests. Employees said the testing was an unlawful medical exam and violated the ADA and GINA.

A bill recently introduced in Congress seeks to eliminate confusion for employers who offer rewards for participation in wellness programs.

“This is yet another example of the EEOC being out of step with employers and employees,” said Sen. Tim Walberg, R-Mich., chairman of the House Subcommittee on Workforce Protections before the proposed rule was issued. “Innovative approaches that empower employees to take more control of their personal health care decisions should be encouraged, not stymied by greater government overreach.”

Conflicting Messages

The proposed rule defines the incentives employers may use to encourage employee participation in wellness programs that include disability-related inquiries or medical exams. It says incentives are allowable as long as other parameters are met.

“As employers have increasingly turned to wellness programs to improve costs and health, they are faced with a quandary as to how to do that without running afoul of the ADA or GINA,” Schuman explained. “The conflicting messages coming from the administration on the one hand with respect to the ACA and its implementations and regulations, and the EEOC on the other, left employers in the crosshairs. I think [the rule] was a welcome development.”

Wellness programs. The EEOC defines wellness programs as those that “may include, for example: nutrition classes, onsite exercise facilities, weight loss and smoking cessation programs, and/or coaching to help employees meet health goals,” the agency said. “Wellness programs also may incorporate health risk assessments and biometric screenings that measure an employee’s health risk factors, such as body weight and cholesterol, blood glucose, and blood pressure levels.”

Incentives offered by employers typically are in the form of either rewards or penalties, such as prizes or cash, a reduction or increase in health care premiums, or cost sharing. Most employers that offer them use incentives totaling less than $500 per year, according to the EEOC.

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Remaining questions. The rule is only a proposal, Schuman noted. She is unsure about such things as the allowable incentives.

“There are questions about how that is determined because the proposed regulations refer to 30 percent of employee-only coverage,” she said, “but often times employees sign up for family coverage. So it doesn’t seem to make sense.”

There is also the matter of GINA. “It doesn’t address GINA at all. That’s still out there,” Schuman said. “Employers are still left with the uncertainty with respect to how wellness programs offering incentives for a spouse to complete a health risk assessment are treated under GINA. This is not the end of the story for direction from the EEOC.”

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at riskletters@lrp.com.
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Workplace Hazards

NIOSH Renews Focus on Workplace Tobacco Risk

New NIOSH recommendations are aimed at protecting all workers from the hazardous effects of tobacco products.
By: | May 21, 2015 • 2 min read
Topics: Safety | Workers' Comp
smoking cessation

“A new report from the National Institute for Occupational Safety and Health recommends that all workplaces become tobacco-free and that employers make tobacco cessation programs available to workers,” the federal agency announced. “These latest recommendations, which also encompass the use of electronic nicotine delivery systems — or e-cigarettes — are aimed at protecting workers from the occupational hazards of tobacco and the effects of secondhand exposure to tobacco smoke and emissions from e-cigarettes.”

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The recommendation comes despite the fact that the habit has declined more than 50 percent among adults in the past 50 years. Nevertheless, NIOSH said about 20 percent of workers still partake, exposing other workers to secondhand smoke.

Smoking in the workplace can result in traumatic fatalities when combined with an occupational hazard, NIOSH said. In addition to explosions and fires, there are other dangers.

“Heat generated by smoking tobacco in the workplace can transform some workplace chemicals into more toxic chemicals, placing workers who smoke at greater risk of toxicity,” the updated document explained. “Tobacco products can readily become contaminated by toxic workplace chemicals through contact of the tobacco products with unwashed hands or contaminated surfaces and through deposition of airborne contaminants onto the tobacco products. Subsequent use of the contaminated tobacco products, whether at or away from the workplace, can facilitate entry of these toxic agents into the user’s body.”

Among industries, smoking rates vary widely. NIOSH said from 2004 to 2011 smoking prevalence ranged from about 10 percent in education services to more than 30 percent in construction, mining, and accommodation and food services. Among occupations, some 50 percent of construction trades helpers smoked while only about 2 percent of religious workers did.

The information and recommendations are included in a Current Intelligence Bulletin, a technical document NIOSH produced. This document builds on previous recommendations concerning tobacco use at work.

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NIOSH recommends that employers “at a minimum, establish and maintain smoke-free workplaces that protect those in workplaces from involuntary, secondhand exposures to tobacco smoke and airborne emissions from e-cigarettes and other electronic nicotine delivery systems.” It states that “Smoke-free zones should encompass: 1) all indoor areas without exceptions (i.e., no indoor smoking areas of any kind, even if separately enclosed and/or ventilated); 2) all areas immediately outside building entrances and air intakes; and 3) all work vehicles. Additionally, ashtrays should be removed from these areas.”

The document is the first to include e-cigarettes. The agency said there is too little data on the safety of exposure to emissions from them.

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at riskletters@lrp.com.
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Workers' Comp Reforms

Illinois Governor Seeks Major Changes to Reduce WC Costs

The governor’s plan includes proposals to cut medical costs, change the standard of causation and narrow the definition of “traveling workers” for comp eligibility.
By: | May 11, 2015 • 3 min read
springfield illinois capitol

Saying he wants to bring workers’ comp costs “in line with other states,” Illinois Gov. Bruce Rauner has laid out plans to reform the system. The Republican outlined a sweeping plan to “make Illinois a growth state again.”

The governor’s proposed Illinois turnaround plan includes proposals to cut medical costs, change the standard of causation, allow the exclusive use of the AMA guidelines to determine permanent partial disability awards, and narrow the definition of “traveling workers” for comp eligibility.

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“According to the 2014 Oregon Workers’ Compensation Premium Rate Ranking Summary, Illinois has the seventh highest workers’ compensation costs in the country,” Rauner said in outlining his plan. “These high structural costs drive jobs to other states, including Indiana, where workers’ compensation costs are more than 50 percent less.”

The causation standard would be raised to say work is a “major contributing cause” rather than “any cause” of an injury or illness. Rauner’s plan would specify that work must be more than 50 percent responsible for the injury/illness to be covered.

“Currently, if the employment is related at all to the injury, no matter how indirectly, the employee’s injury is compensable,” the governor stated. “If a work injury aggravates a preexisting condition even slightly, the employer is 100 percent liable for the workers’ compensation claim.”

Rauner noted that 29 states have a higher causation standard than Illinois. His proposed change would make Illinois’ standard identical to that in Florida.

The use of the American Medical Association guidelines is one of five factors that workers’ comp commissioners may include to determine PPD awards in Illinois under legislation passed in 2011. Current law limits the use of only one factor.

“The AMA guidelines are more conservative in determining the awards and thus it was hoped that allowing commissioners to use these guidelines would reduce awards,” the governor said. “While complete data on the use of AMA guidelines since 2011 is not yet available, a study of 20 cases … shows a 12.24 percent reduction in awards when using the AMA guidelines.”

“If a work injury aggravates a preexisting condition even slightly, the employer is 100 percent liable for the workers’ compensation claim.” — Illinois Governor Bruce Rauner

Rauner’s plan would allow, though not mandate, the exclusive use of the AMA guidelines. It also would allow consideration of an independent medical examiner’s records in addition to those of a treating physician.

Reducing the medical reimbursement rates by 30 percent for most services would result in a 15 percent to 20 percent reduction in medical claim costs, Rauner said. His proposal comes despite a similar fee schedule cut implemented in 2011.

“Even with the 2011 reforms, workers’ compensation medical fees in Illinois are significantly larger than the median of other states,” the governor said. “Surgery costs are the most egregious fee schedule abuses with rates 300 percent to 400 percent above Medicare rates and 100 percent to 200 percent above group health.”

Rauner’s plan would reduce the fee schedule for all services except evaluation and management and physical medicine.

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“The Illinois Appellate Court has greatly expanded the scope of what constitutes a ‘traveling employee’ for purposes of workers’ compensation,” Rauner said. “For example, an employee’s injuries were found to be compensable when that employee slipped and fell on the way to work.” Rauner proposes narrowing the definition of “travel.”

In addition, Illinois Turnaround proposes changes to other programs such as unemployment insurance, the judicial climate, and employee empowerment zones. Rauner said he would support increasing Illinois’ minimum wage if reforms were made to the other systems.

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at riskletters@lrp.com.
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