What New Wellness Rules Mean for You.

Compliance with health insurance portability and accountability act (HIPAA) non-discrimination rules is a big challenge for wellness programs. the old rules were unclear about which incentives passed muster.

That’s all changed, with the rules established earlier this year by the DOL and U.S.  Treasury Department. the rules themselves haven’t changed, but they’ve been clarified. Here’s what you need to know -

‘Participation incentives’ are fine

As long as you structure incentives as rewards for wellness participation, the new rules provide a lot of freedom. All of these are fine under health insurance portability and accountability act (HIPAA) -

• reimbursing all or a portion of the cost of fitness club membership

• financial rewards for undergoing health risk (assessment|appraisal}s so long as the reward is based on participation rather than test results

• encouraging preventive care by waiving co-pays or deductibles for these services (i.e., well-baby visits or prenatal care)

• reimbursing staff members for the cost of tobacco use-cessation programs without regard to the result, and

• offering rewards tied to employees attending a monthly health education seminar or working with a health coach.

Conditional rewards OK if…

But what if you want to make the reward conditional on participants meeting specific health goals? Example -  Employees who achieve a cholesterol count under 200 get a 20% reduction in the cost of their health plan contributions pending results of an annual cholesterol test.

The feds say it’s OK under health insurance portability and accountability act (HIPAA) to do this, too, but your plan must meet five additional requirements -

• the reward can’t exceed 20 percent of the cost of employee-only (or, if you allow dependents to participate, employee-plus-dependent) coverage under your health plan.

• the standards ought to be reasonable (e.g., you can’t limit rewards to folks who can run a marathon). the rewards also can’t be used as a backhanded way to negatively single out certain staff members (e.g., rewards for all non-diabetics).

• Participants must have the opportunity to qualify for the reward at least once per year (e.g., a smoker who fails to quit this year gets another chance next year).

• Rewards must be available to all “similarly situated individuals.” In other words, you can’t make a company-compensated weight management program available to certain staff members but not others.

If, for medical reasons, it’s unreasonably difficult for an individual to satisfy conditions that are otherwise reasonable, you have to offer an alternative. Example -  A pregnant employee may not be able to meet certain standards, so you have to offer her an alternative.

Negative incentives violate health insurance portability and accountability act (HIPAA)

So what’s not permitted under HIPAA’s non-discrimination rules? Anything that punishes individuals  for their health conditions or health risks.

The rules prohibit companys from charging different premiums, contributions, co-pays or deductibles based on personal health factors such as obesity or use of tobacco. However, it’s OK to reimburse these expenses based on someone’s participation in your wellness program, without regard to success.

In addition, the feds have added an important new non-discrimination rule -  Employers’ health plans can’t deny benefits for treatment of injuries resulting from a health condition, even if the condition wasn’t diagnosed before the injury.

For  instance, some health plans have a “suicide exclusion” that denies payment for treating self-inflicted wounds from a suicide try. Now let’s suppose the staff member suffers from clinical depression. Even when the depression was undiagnosed before the suicide try, it’s illegal for your plan to deny benefits to this staff member.