Work it Out Blog

Employer’s Mandatory Wellness Plan Falls within ADA Safe Harbor

Feb 09, 2016

In 2012, Flambeau, Inc., a plastics manufacturer in Wisconsin, instituted a requirement that employees who wanted to participate in the company’s health insurance plan had to complete mandatory wellness plan requirements.  Among other things, employees had to undergo a health risk assessment and a “biometric screening,” which was similar to a routine physical exam.  One employee refused to participate, and subsequently lost his health insurance coverage. 

The Equal Employment Opportunity Commission (“EEOC”) filed a lawsuit on the employee’s behalf, asserting that the wellness plan requirements violated the provision of the Americans with Disabilities Act (ADA) prohibiting employer-mandated medical exams.  Siding with the employer, the judge held that Flambeau’s wellness plan requirements fell within the ADA’s “safe harbor,” which provides that the ADA “shall not be construed to prohibit or restrict” an employer from administrating  “the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks.”

The court found that Flambeau’s wellness plan was clearly outlined as a “term” of the company’s health insurance plan, and that the company utilized the information gathered from the wellness program for underwriting, classifying, and administering risks.  Thus, the wellness plan fell within the safe harbor provision and was not a violation of the ADA.

While this decision is a positive step for employers, it is unclear what impact the decision will have, or how it will be applied in other jurisdictions.  The EEOC is already in the process of proposing new rules governing employee health plans, and the Flambeau decision may ultimately have an impact on the final regulations.  For now, employers should take note that to fall within the ADA safe harbor provision, a wellness program must be considered a “term” of the employer’s health insurance plan, and must be clearly intended to assist the employer in underwriting, classifying, or administering risks in connection with the health plan.   For more information, and to make sure your company is in compliance, contact Michelle Reese at 330.455.0173 or mrreese@dayketterer.com.

The content of this blog is for informational purposes only and is not intended as legal advice for any purpose. This blog is not intended to present an exhaustive summary of all applicable laws, or to take the place of legal advice.  If you have any questions regarding the law, please contact us for assistance.