The Joint Committee on Employee Benefits (JCEB) of the American Bar Association (ABA) has issued Q&As containing responses from Equal Employment Opportunity Commission (EEOC) staff members to six questions. The Q&As, compiled by the JCEB, are based on discussions between JCEB and EEOC representatives at their annual meeting, which took place on May 7, 2015. Responses to the questions are unofficial and nonbinding. Health and welfare plan issues addressed include:

The EEOC staff addressed whether it is an ADA violation for a self-funded group health plan formulary to exclude a particular drug from coverage strictly on the basis of cost. Specifically, EEOC staff considered whether exclusion of a drug used to treat a disabling condition would be viewed as singling out certain individuals based on their health condition in violation of the ADA. Under the ADA, employers are prohibited from discriminating against individuals based on disability (see Practice Note, Disability Discrimination under the ADA).

According to the EEOC staff, there is currently no cost-based safe-harbor or exception under the ADA, and whether exclusion of a specific drug violates the ADA depends on the facts of the case. The staff added, however, that the exclusion would not violate the ADA if the formulary includes one or more drugs that treats the condition in a manner as effective as the excluded drug. The staff also noted potential race or sex discrimination implications if the excluded drug is used to treat conditions specific to (or more prevalent in) one sex or race/ethnic group.

In a separate question, the EEOC staff considered whether certain non-experimental, medically necessary drugs could be excluded under a formulary without violating the ADA. The ADA does not expressly address whether a particular drug must be included in a plan's formulary. The EEOC staff stated that excluding a drug that is medically necessary to treat a disabling condition may violate the ADA. Based on its analysis in earlier guidance, the staff took the view that exclusions of treatments used exclusively (or nearly exclusively) by individuals with disabilities are disability-based distinctions. As a result, an employer or health plan would need to show that the distinction was not intended to avoid the ADA's purposes, as described in the earlier guidance.

In another question, the EEOC staff addressed whether the following wellness program design was permissible under the ADA:

Examples of this design involved requirements that measured waist circumference.

The EEOC staff indicated that if the program only provided for measuring participants' waistlines then it would not be subject to the EEOC's proposed regulations on the ADA and wellness (see Legal Update, EEOC Rules Address Wellness Incentives under the ADA). This is because measuring a participant's waistline is not a disability-related inquiry or medical examination. However, if the program ties incentives to an employee answering disability-related questions or taking a medical exam, then the incentives for program participation and achieving certain health outcomes must not be more than 30% of the total cost of self-only coverage (see Practice Note, Wellness Programs: EEOC Rules under the ADA).

In another wellness-related question, the EEOC staff addressed whether a wellness program based on the "Biggest Loser" challenge and provided by a third-party vendor is a workplace wellness program subject to the proposed ADA wellness rules (see Legal Update, EEOC Rules Address Wellness Incentives under the ADA). Under the program, which did not have incentives tied to a group health plan:

The staff noted that this type of program is provided through a third-party vendor and not part of the employer's group health plan. According to the EEOC, because the employer does not offer the cash prize, the program is not required to make reasonable accommodations for employees with ADA-covered disabilities.

The EEOC staff also responded to questions relating to a spouse's disability in the context of GINA and the ADA. The questions involved the following fact scenario:

First, the staff addressed whether a plan would violate the ADA by reducing the level of coverage if an employee's spouse with a disabling condition (for example, diabetes) refuses to participate in the employer's wellness program. The EEOC's answer indicates that the employer's actions would likely violate the ADA's "association" provision, which prohibits discrimination based on an employee's association with a person (here, the spouse) who has a disability. Additionally, the EEOC noted that the penalty is inconsistent with HIPAA's nondiscrimination requirements, as amended by the Affordable Care Act (ACA).

The staff also considered whether a plan violates GINA by providing an employer with medical information for the purpose of determining coverage (see Practice Note, GINA Compliance for Health and Welfare Plans). The staff stated that the plan in this case would violate GINA because information about the health of an employee's spouse is considered family medical history, and therefore genetic information about the employee. The staff acknowledged, however, that they have not seen claims involving a reduction of health coverage based on current health information about an employee's spouse.

Earlier this year, the EEOC published proposed regulations addressing wellness programs and the ADA, which (though not yet final) expand the regulatory framework employers should consider with respect to their wellness programs. These Q&As build on that guidance in the context of a biometric risk requirement that is fairly common to employer wellness programs. Also, these Q&As (nonbinding though they are) assert a limitation involving prescription drug formularies under the ADA that may come as a surprise to many employers and health plans.

In a related development, the Congressional Research Service prepared a report for members of Congress providing FAQs on similar issues, including employer wellness programs and genetic information.