If you haven’t been keeping tabs over the last few months, there has been some increasing friction between the EEOC and the corporate world over a seemingly harmless set of programs focusing on employee wellness. Note that this is primarily focused on health and wellness programs, not those targeting financial wellness. While this has been frustrating for those affected, it does provide an impetus for companies that is long overdue. In the long run companies will focus more on wellness programs that actually bring results, not just on checking the obligatory box on a list of employee benefit offerings.
Wellness by the Numbers
According to the Kaiser Family Foundation Health survey:
- 94% of firms with over 200 employees offer wellness programs
- 11% of those organizations have penalties for employees that do not complete all required health management procedures
- 9% of large companies penalize employees for not meeting specific biometric outcomes (BMI, cholesterol, etc.)
Wellness is here to stay, with the majority of companies believe that offering these types of options will help to lower insurance costs over time.
The Battle for Wellness
Orion Energy Systems was a typical organization with regard to its wellness program. It required health-related actions from its employees and used incentives/penalties to encourage the behaviors consistent with its wellness program goals. But it didn’t turn out so well.
Orion instituted a wellness program that required medical examinations… When employee Wendy Schobert declined to participate in the program, Orion shifted responsibility for payment of the entire premium for her employee health benefits from Orion to Schobert. Shortly thereafter, Orion fired Schobert.
For reference purposes, Orion meets the “large company” criteria in the Kaiser report cited above. Here’s what happened next:
Orion Energy Systems violated federal law by requiring an employee to submit to medical exams and inquiries that were not job-related and consistent with business necessity as part of a so-called “wellness program,” which was not voluntary, and then by firing the employee when she objected to the program, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit it filed recently.
In case you’re wondering, Orion is not the only organization that falls into this category. Honeywell International also had an opportunity to face the ire of the EEOC for similar reasons..
The Outlook on Wellness
The EEOC has just released its Notice of Proposed Rulemaking (NPRM) with regard to this complex issue. This breakdown by the Jackson Lewis law firm is a great look at some of the key areas of the proposal, but one piece in particular stuck out for me (emphasis mine):
“The NPRM requires that if an employee health program seeks information about employee health or medical examinations, the program must be reasonably likely to promote health or prevent disease. Employees may not be required to participate in a wellness program, and they may not be denied health coverage or disciplined if they refuse to participate.”
Believe it or not, after all of the time, legal battles, and other resources expended on the world of wellness, it comes down to whether or not the program is actually going to promote health or prevent disease. We actually have to measure these initiatives and not just put blind faith in their ability to make our employees and organizations healthier. If that sounds a bit harsh, I’d advise you to check out this discussion on the results of wellness (or a lack thereof). On the other hand, companies like Johnson & Johnson have been more successful.
There are other aspects, such as voluntary participation and limits on incentives, but I think it’s just one more push in the direction of measuring everything and only pursuing those that are going to deliver results. Not everything that is measurable matters, but everything that matters should be measurable.
What are your thoughts on this shift? Is it going to hinder companies from offering wellness programs, or will it force them to deliver better ones with measurable outcomes?
–Ben Eubanks, Associate HCM Analyst, Brandon Hall Group