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Just when you thought the legal environment surrounding employer wellness programs couldn’t get more complicated, we have the news that the American Association of Retired Persons (AARP) has sued the Equal Employment Opportunity Commission (EEOC) to block new regulations that would apply to employer wellness programs beginning in 2017.

We’ve previously written on those complex rules. They require that employer wellness programs that include disability-related inquiries or medical exams (e.g., biometric screenings, such as blood tests) meet new standards, including a limit on any award or penalty. That limit is no more than 30 percent of the cost of employee-only coverage. A separate limit applies to spouses if there is an inquiry or exam for them.

“  Before you think the AARP is taking the employer’s side here, and is complaining that the rules are unduly burdensome to employers, think again. ”

 Before you think the AARP is taking the employer’s side here, and is complaining that the rules are unduly burdensome to employers, think again. According to AARP, the EEOC’s 30 percent threshold is too high. In fact, so high that employee participation in these programs is not “voluntary.” According to AARP, the EEOC wellness rules “enable employers to pressure employees to divulge their own confidential health information and the confidential genetic information of their spouses as part of an employee ‘wellness’ program.” As such, the AARP argues the EEOC rules also violate federal laws governing protection of confidential medical information.

Lockton comment: At least one federal court has ruled that an employee can be charged 100 percent of the   premium cost by refusing to get a biometric screening. In addition, most employers use third party vendors to conduct the tests and gather this information. The regime under the HIPAA privacy and data security rules governs the privacy of that data.

AARP is seeking a preliminary injunction to block implementation of the EEOC rules. For now, employers need to press ahead with their wellness programs for 2017. This author hopes this lawsuit goes no place fast and does not prompt EEOC to reconsider the award thresholds in its regulations. Stay tuned as this and other issues involving employer wellness program s grind through the courts.

Lockton comment: The regulatory regime for wellness programs not only includes the EEOC rules, but the ACA/HIPAA wellness rules that were finalized in 2013. The existing disconnect between the EEOC rules and ACA/HIPAA rules is irksome but largely manageable, and at least the EEOC tried to find some relatively common ground. A wider disconnect in incentive limits – that is, a very small incentive limit under EEOC rules – would cause employers to lose significant leverage to drive, through financial incentives, employee behavioral change or even mere participation in a health risk assessment. We’re not convinced that’s a great idea.