I just filed comments on the proposed regulations under the Affordable Care Act for employer wellness plans. Hint: I think they are terrible! Here is the summary. Click here for the full 27 page comments: MorganDowney_Wellness Program Comments
Can Congress require you to buy broccoli? Evidently yes if Congress incentivizes employers to require it of their employees. Can Congress mandate exercise program? Evidently yes if they incentivize your employer to require you to spend your free time in physical activity. Can Congress regulate the diet and physical activity of many if not most of its citizens indirectly through employers when it would be unconstitutional for them to do so directly? These are only some of the unanswered questions raised in the proposed regulations.
On November 20, 2012, the Department of the Treasury, Department of Labor and Department of Health and Human Services (hereinafter the “Departments”) proposed regulations, “Incentives for Nondiscriminatory Wellness Programs in Group Health Plans.”
The proposed regulations:
- are probably unconstitutional,
- undermine three explicit promises made by President Obama in relationship to the Affordable Care Act,
- that those in current plans will not be affected
- that no one will be charged more for a pre-existing condition, and,
- that life sciences research will be supported,
- impose unjustified additional costs on millions of middle class American workers without commensurate benefit, especially on working women with obesity in firms providing health insurance who already pay a “wage penalty.”
- ignore evidence employer weight management wellness plans produce marginal, if any, benefit,
- promote a model of an employer weight management program that conflicts with the Americans with Disabilities Act
- inadequately identify when a wellness program is a subterfuge for cost-shifting
- recognize that employer wellness programs are human experiments but do not minimum protections for animals, much less human subjects
- undermine federal, state and local law enforcement efforts to police weight loss frauds and scams including those of the Federal Trade Commission,
- have inadequate provisions for reasonable alternatives,
The regulations should be withdrawn until these major issues can be resolved.
The proposed regulations address wellness programs in group health coverage under the Affordable Care Act (ACA). The regulations provide the maximum reward permissible under a health-contingent wellness program offered in connection with a group plan, raising the maximum from 20% to 30% of the cost of health insurance coverage. (A 50% maximum would be available for programs designed to reduce tobacco use.) The regulations clarify the definition of a “reasonable design of health-contingent wellness programs” and the reasonable alternatives that must be provided in order to avoid prohibited discrimination. These clarifications are problematic.
Prior to the enactment of the Affordable Care Act (ACA), federal law (i.e. the Health Insurance Portability Accessibility Act or HIPAA) prohibited group health plans and group health insurance issuers from discriminating against individual participants and beneficiaries in eligibility, benefits or premiums based on a health factor. Employers are banned from varying health insurance premiums on the basis of health status. HIPPA provides an exception for premium discounts, rebates, etc. in return for participation in health promotion and disease prevention programs.
Regulations implementing HIPPA provided for two types of programs. The first are called “participatory wellness programs” in which participation is voluntary and either provides no rewards or does not provide criteria for receiving an award. The second type of program is quite different. It is called a “health-contingent wellness program” which requires an employee to attain or maintain a certain health outcome in order to obtain a reward, such as meeting a specific weight or Body Mass Index (BMI), a blood pressure measure, or other physiological metric. While the regulations avoid using the term “mandates” or “mandatory,” that is what they are and that is what the regulatory scheme assumes. Such programs are mandatory for all employees, although the proposed regulations provide for person-by-person or a group of employees exemptions and for alternatives. Mandatory health-contingent wellness programs were not described in the original HIPAA legislation. These mandatory health-contingent wellness programs must be of “reasonable design” and a “reasonable alternative” ways to avoid the penalty.
The ACA amended federal law to raise the maximum penalty from 20% to 30% (and 50% for tobacco use cessation programs) of the total health insurance premium for the employee. The following comments are directed primarily at the mandatory health-contingent wellness program provisions.