Many companies established wellness plans prior to the ACA, but in order to optimize them they must comply with the Act. Generally speaking, the ACA prohibits discrimination with regards to wellness plans with the exception of specific safe harbors established. Employers must make certain their plans and practices do not compromise the safe harbor in order to avoid discrimination claims.
The ACA recognizes four different types of wellness plans:
- Participatory wellness programs are programs that either do not provide a reward or do not include any conditions for obtaining a reward that are based on an individual satisfying a standard that is related to a health factor. An example includes receiving a reward for completing a health risk assessment or having a bio-metric screening performed regardless of the outcome or results.
- Health-contingent wellness programs are programs that require an individual to satisfy a standard related to a health factor to obtain the reward.
- Activity-only wellness programs require that an individual perform or complete an activity related to a health factor to obtain a reward. Examples of activity-only wellness programs include walking, diet or exercise programs, where participation in such programs adjusts benefits or premiums under a group health plan.
- Outcome-based wellness programs require that an individual attain or maintain a specific health outcome to obtain a reward. Examples of outcome-based wellness programs include programs that provide rewards for not using tobacco products or testing within a normal range under a bio-metric screening.
There are specific requirements for each type of plan, and all must be met in order for the plan to be considered non-discriminatory. Here is an in-depth report prepared by Denise Atwood of Snell and Wilmer, LLP that provides thorough guidance and direction to ensuring the compliant operation of wellness plans.