HHS Finalizes Employee Wellness Regulations

The U.S. Departments of Health and Human Services, Labor and the Treasury released final rules describing the standards for employee wellness programs and rewards associated with them as part of the Affordable Care Act.   The final rules will take effect for plan years beginning on or after January 1, 2014.

Below is a summary of the key provisions in the final rules.

• Outlines amended standards for nondiscriminatory health-contingent wellness programs
  • Requires individuals to meet a specific standard related to their health to obtain a reward
  • Wellness programs must follow certain rules
    • Must be reasonably designed to promote health or prevent disease
    • Must be reasonably designed to be available to all similarly situated individuals
    • Must be given notice of the opportunity to qualify for the same reward through other means
• Supports workplace wellness programs, including participatory wellness programs, which generally are available without regard to an individual’s health status
• Increases the maximum permissible reward under a health-contingent wellness program from 20% to 30% of the cost of health coverage and further increases the maximum reward to as much as 50% for programs designed to prevent or reduce tobacco use or if federal regulators determine that such an increase is appropriate
• Rule applies to employer group health plans and to health insurance issuers offering group health insurance coverage