The federal judge who declared the EEOC wellness regulations invalid in August of 2017, ordering the EEOC to revise their regulations, has taken further action and ruled that the EEOC wellness regulations will be vacated on January 1, 2019.

This vacates the EEOC rules that establish the extent to which employers may penalize their employees for not providing certain health information on themselves or their spouses without violating the American with Disabilities Act (ADA) or the Genetic Information Nondiscrimination Act (GINA) which prohibit employers from collecting such information unless the information is provided on a strictly voluntary basis. The current EEOC rules allow an employer to penalize their employees up to 30 percent of the cost of coverage if the employee and/or spouse don't provide certain medical or genetic information by completing health questionnaires as part of their wellness initiative. However, it was challenged that the level of potential penalty was inconsistent with the meaning of the term “voluntary”. 

In August, the federal judge ruled that the EEOC had been unable to defend their regulations and why the EEOC felt as though their rules aligned with the ADA and GINA rules. The EEOC was ordered to revise their regulations. At that time, the judge didn't vacate the rules, as he felt it would cause undue stress on employers who had designed their programs around the EEOC rules. However, the EEOC response, provided in September of 2017, stated they would issue new proposed rules by August 2018, with the anticipation of finalizing those rules in October 2019 with a 2021 effective date. The delay in the EEOC’s response prompted the federal judge to vacate the EEOC rules effective January 1, 2019.

What This Means for Employers

While the EEOC rules stand to be vacated in 2019, HIPAA still allows employers to offer wellness incentives, and the net effect of this ruling may be to simply remove one barrier for wellness plans. HIPAA’s wellness rules are less restrictive than what the EEOC’s regulations have been. That said, for 2018, the rules haven't changed, so any current wellness plans in place should remain unchanged as all compliant plans will remain in compliance. Assurance will continue to monitor this as 2018 unfolds.

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