Wellness Programs: Rewards, Penalties, and Legal RisksHR Resource
April 12, 2013 — 2,300 views
Employers have noticed over the years that the bad health of the employee will manifest itself as losses for the company. For example, if the employee is perpetually or regularly unwell, his/her productivity will suffer. In some cases, this can result in absenteeism. Another factor is that the burden of healthcare will fall on the employer as the employer is responsible for the insurance.
Keeping all these factors in mind, employers figured that the best way to avoid all these issues would be to keep the employees healthy. This resulted in the conception and implementation of programs known as wellness programs. These programs aim at ensuring that the health of the employee will not deteriorate, either due to inherent or external factors.
Role of PPACA in Wellness Programs
The Patient Protection and Affordable Care Act, more commonly known as the PPACA, play a vital role in the implementation of wellness programs at workplaces. The act supports the developments of new incentives that will back up the already enforced wellness programs to ensure that all the employees receive adequate care. Also, the PPACA will reduce the overall costs incurred, providing encouragement to both to the employees and the employer, to aggressively implement wellness programs.
Regulations to Protect Consumers
A few clauses in the recently changed wellness program regulations ensure that the consumers/employees are benefited by the wellness programs. One of the clauses states that the wellness programs implemented should be designed reasonably to ensure the health of the employees and also promote a healthy lifestyle. Another clause states that the means that the employees use to obtain benefits from these programs should be easy and accessible to all. Also, the individuals should have the opportunity of applying for the benefits of the wellness programs through means other than the wellness programs.
In order encourage employees to take up wellness programs actively, employers have come up with a penalty model. If an employee doesn’t sign up for a wellness program, then he/she will have to pay up a percentage or even the full premium fees for the insurance that the employer gives. The logic behind this is simple. Wellness programs are designed to reduce healthcare costs. If an employee says no to the programs, he/she is not inclined to stay healthy. As a result, the employee should pay up for his/her own healthcare costs. Over the past few years, employers have been ramping up the wellness program penalties.
Legal Risks Associated with Wellness Programs
In a bid to promote wellness programs, employers are on the path to make some of the programs mandatory. This brings the legal rights of the employees into play and hence poses an increased risk of litigation. For example, a firefighting company made monitoring blood cholesterol levels mandatory. This required regular blood samples from the firefighters. The firefighters opposed to this saying that their 4th and 14th Amendment Rights are violated by this program. Also, the requirement to present themselves to blood testing violated the firefighters’ bargaining agreement.
The aforementioned is only a small example of the number of other legal risks associated with aggressively enforced wellness programs. If you are an employer, it is best to take legal consultation before implementing a wellness program.