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Tuesday, March 9, 2010

HIPAA Regulations and Wellness Programs

If you're a wellness professional, you're probably all too familiar with the requirements of HIPAA (The Health Insurance Portability and Accountability Act). Although the 1996 law was passed to protect the privacy of health information, its provisions also affect wellness programs. In fact, it makes them possible!

Generally, HIPAA doesn't allow group health plans to treat people differently because of a "health factor." The Department of Labor lists the health factors at its website. But because employee wellness programs are so beneficial, some exceptions are allowed. You just have to follow the rules.

If a wellness program doesn't require participants to meet specific health goals, then you can encourage healthy behavior in a variety of ways. The Department of Labor mentions things like subsidized gym memberships, rewards for attending health education seminars, and the like.

If you require employees to meet health benchmarks in exchange for a reward--such as a reduction in premiums--you must meet five requirements (paraphrased here for easier reading):
  1. The total reward must not exceed 20 percent of the cost of employee-only coverage under the plan.
  2. The program must be reasonably designed to promote health and prevent disease.
  3. Eligible individuals must have the opportunity to qualify for the reward at least once per year.
  4. The reward must be available to everyone who is "similarly situated." If it is unreasonably difficult for someone to satisfy the program's requirements (due to a medical condition, for example), then you must create a reasonable alternative standard for that individual.
  5. The alternative standard (#4) must be disclosed in all plan materials.
HIPAA rules can be intimidating if you're not familiar with them, but their purpose is to prevent unfair treatment of employees. Let us know if you have any questions. New rules governing health risk assessments are also in the works, so stay tuned to Corporate Wellness Insights for the latest.

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