In yesterday’s Advisor, we looked at DOL’s checklist for wellness program compliance. Today, the “paragraph (f)” criteria, plus an introduction to the wellness program guide that boosts the ROI of your program.
If you want to institute a wellness program that discriminates based on a health factor (for example, rewards people who have low cholesterol or low blood pressure), there are five criteria that must be met:
[Go here for the first four questions on DOL’s checklist]
1. The 20% Rule
Is the amount of the reward offered under the plan limited to 20% of the applicable cost of coverage? (29 CFR 2590.702(f)(2)(i)).[ ] Yes [ ]No
Keep in mind these considerations when analyzing the reward amount:
Who is eligible to participate in the wellness program? If only employees are eligible to participate, the amount of the reward must not exceed 20% of the cost of employee-only coverage under the plan. If employees and any class of dependents are eligible to participate, the reward must not exceed 20% of the cost of coverage in which an employee and any dependents are enrolled.
Does the plan have more than one wellness program? The 20% limitation on the amount of the reward applies to all of a plan’s wellness programs that require individuals to meet a standard related to a health factor.
Example: If the plan has two wellness programs with standards related to a health factor, a 20% reward for meeting a body mass index target and a 10% reward for meeting a cholesterol target, it must decrease the total reward available from 30% to 20%.
However, if instead, the program offered a 10% reward for meeting a body mass index target, a 10% reward for meeting a cholesterol target, and a 10% reward for completing a health risk assessment (regardless of any individual’s specific health information), the rewards do not need to be adjusted because the 10% reward for completing the health risk assessment does not require individuals to meet a standard related to a health factor.
2. Plan Promotes Health
Is the plan reasonably designed to promote health or prevent disease? (29 CFR 2590.702(f)(2)(ii)) [ ] Yes [ ]No
The program should have a reasonable chance of improving the health of or preventing disease in participating individuals, not be overly burdensome, not be a subterfuge for discriminating based on a health factor, and not be highly suspect in the method chosen to promote health or prevent disease.
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3. Universal Eligibility
Is the reward available to all similarly situated individuals? Are individuals who are eligible to participate given a chance to qualify at least once per year? (29 CFR 2590.702(f)(2)(iii)) [ ] Yes [ ]No
The wellness program rules require that the reward be available to all similarly situated individuals.
4. Alternative Standard
Does the program offer a reasonable alternative standard? (29 CFR 2590.702(f)(2)(iv))[ ] Yes [ ]No
The program must have a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual for whom, for that period:
- It is unreasonably difficult due to a medical condition to satisfy the otherwise applicable standard; OR
- It is medically inadvisable to attempt to satisfy the otherwise applicable standard.
5. Disclosure
Does the plan disclose the availability of a reasonable alternative in all plan materials describing the program? (29 CFR 2590.702(f)(2)(v)).. [ ] Yes [ ]No
The plan or issuer must disclose the availability of a reasonable alternative standard in all plan materials describing the program. If plan materials merely mention that the program is available, without describing its terms, this disclosure is not required.
If you answered “Yes” to ALL of the 5 questions on wellness program criteria, there are no violations of the HIPAA wellness program rules.
If you answered “No” to any of the 5 questions on wellness program criteria, the plan has a wellness program compliance issue.
Well-structured and well-run wellness programs can generate ROIs of up to 300 percent—music to management’s ears! But the key words are “well-structured” and “well-run.” Poorly structured programs just spin their wheels—no health benefit and no positive ROI, either.
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It’s a comprehensive guide that takes you step-by-step through setting up a program, from convincing management all the way through creating and implementing a viable plan for your workplace. The guide also includes a vast collection of ready-to-use forms, handouts, and checklists that both structure your program and provide the metrics to prove its effectiveness to management’s satisfaction.
If you’d like to examine Workplace Wellness: Healthy Employees, Healthy Families, Healthy ROI on a no-cost, no-obligation basis for 30 days, we can arrange for you to do so. Let us know and we’ll be happy to set it up. Plus, we’ll give you a free special report just for trying it out, that’s yours to keep no matter what you decide.
Wellness program hurdles aren’t limited compliance with the DOL’s requirements. There are also, for example, GINA implications if your risk assessments include questions about family medical history or other genetic information.