HRCI Pre approved 4/17/2014. Complimentary Webinar Series Wellness Incentive Regulations. Download copy of slides

Transcription

1 Complimentary Webinar Series Wellness Incentive Regulations Download copy of slides To Troubleshoot webinar, go to HRCI Pre approved 1 General Credit The link to the certificate will be provided at the end WhiteWater Wellness LLC Cara Fairbanks, SPHR, CWPM 1

2 What We ll Cover: Wellness regulations background Current regulations and when they took effect Important definitions Participatory Wellness Program Health Contingent Wellness Program Activity only Outcomes based 5 Requirements of Health Contingent Programs Summary and reference What We Won t Cover (but you should think about): Do incentives work? What do they work for? Should you use incentives in your wellness program? What are different types of incentives? Should incentives be framed as a carrot or stick? And does it really matter? How to design wellness programs Please note: Examples provided in this presentation are not an endorsement of any type of wellness program design 2

3 What HIPAA does: HIPAA Nondiscrimination rules prohibit employers from using different eligibility rules or offering different benefits based on individual health factors HIPAA includes an exception to the general prohibition against discrimination with a HIPAA compliant health promotion or disease prevention program. Health status Medical condition Claim experience Receipt of health care Medical history Genetic information Evidence of insurability and disability Timeline of Rules & Regs 1996 HIPAA amended IRC, ERISA, PHSA prohibits discrimination based on health factor but allows wellness related discounts, rewards, etc Conditions issued for offering such wellness rewards/penalties based on health standards 2010 ACA modified HIPAA, codifying 2006 regs, increases maximum allowable rewards May 2013 Final regs released for plans beginning on or after Jan 1, 2014 made adjustment for what it means to be compliant Who it applies to: Wellness programs being offered in connection with an employer group health plan for policy or plan years beginning on or after January 1, 2014, in all of the following: Fully insured Self insured Large group Small group Non grandfathered Grandfathered 3

4 A few more applicable laws: GINA (Genetic Information Nondiscrimination Act) ADA (Americans with Disabilities Act) Title VII of the Civil Rights Act of 1964 IRC (internal revenue code) tax implications of rewards Remember: Final regulations do not affect the applicability of or preempt any act, provisions, laws, etc which may impose further limitations on wellness programs. Contact legal counsel or other gov t agencies such as EEOC, DOL, your insurance broker, or a worksite wellness expert. State laws FMLA Rewards Participatory Wellness Program Health Contingent Wellness Program Rewards Obtain a Reward Discount or rebate of a premium or contribution Waiver of all or part of a costsharing mechanism (deductible, co pay) Additional benefit, any financial or other incentive Avoid a Penalty Absence of a surcharge Other financial or non financial disincentives 4

5 Participatory Wellness Programs Does NOT provide a reward OR Rewards for things anyone can do, regardless of health OR Do not include any conditions for obtaining a reward that are based on satisfying a standard related to a health factor. Rewards in participatory wellness programs do NOT count toward maximum allowable reward threshold. No limit on financial incentives for participatory wellness programs. Examples of Participatory Wellness Programs: Program reimburses employees for all or part of the cost of a gym membership (regardless of gym use) Biometric screening or diagnostic testing program that provides a reward for participation and does not base any part of reward on outcomes. Program provides a reward to employees for attending a monthly, free health education seminar (regardless of success) Waiver of a co pay or deductible required for prenatal care, well baby visits or diabetic checks. Health Contingent Wellness Programs Require an individual to satisfy a standard related to a health factor to obtain a reward SUBDIVIDED INTO: Activity only wellness programs Outcome based wellness programs MUST comply with 5 requirements to protect consumers from unfair practices and avoid offering a discriminatory program 5

6 Health Contingent: Activity Only Require individual to perform or complete an activity related to a health factor to obtain reward DO NOT require an individual to attain or maintain a specific health standard Rewards for things that some people may be unable to do because of health EXAMPLES: Walking program that requires 5000 steps per day Gym membership reimbursement that requires attendance at gym 3 days per week Health Contingent: Outcome Based Require an individual to attain or maintain a specific health outcome to obtain reward Generally includes: Measurement, test or screening as part of initial standard Targeting those who do not meet initial standard with wellness activities EXAMPLES: Cholesterol screening program that requires achievement of certain level BMI screening requiring a level in a certain range Tobacco use surcharge Do you have to follow the rules? Participatory Plans Rewards based on participation only, no health factors Offered to all similarly situated individuals P DOES NOT HAVE TO MEET THE 5 REQUIREMENTS Health Contingent Plans Rewards based on meeting a standard related to a health factor Two categories: Activity Only Outcome Based BOTH MUST MEET THE 5 REQUIREMENTS OUTLINED IN THE REGS (But they differ slightly) 6

7 1. Frequency of Opportunity Individuals must be given the opportunity to qualify for the reward AT LEAST ONCE PER YEAR 2. Size of Reward Total reward cannot exceed 30% of total cost of coverage under the health plan 50% if tobacco cessation program Cost of coverage = employee + employer contributions OR COBRA rate (minus 2% admin) Rewards for participatory pieces not included If ONLY employees are eligible to participate, then ONLY consider total cost of employee only coverage for determining maximum 7

8 Apply it EXAMPLE 1: An employer sponsors a group health plan. The annual premium for employee only coverage is $6,000 ($500/mo). The plan offers employees a health contingent wellness program with several components, focused on exercise, blood sugar, weight, cholesterol, and blood pressure. The reward for compliance is a monthly premium discount of $50. Is it compliant? 30% allows for up to $1800 per year in reward $50/mo is only $600 annually. EXAMPLE 2: Same health plan, EXCEPT the wellness program is exclusively a tobacco prevention program. Employees who have used tobacco in the prior 12 months and not enrolled in a tobacco cessation program are charged a $200 monthly premium surcharge (in addition to the employee premium contribution). Compliant? Yes 50% allows for up to $3,000 incentive value; $200/mo is $2,400 annually which falls under the max. EXAMPLE 3: Same health plan, but in addition to the $600 annual reward for compliance with the health contingent wellness program (as in example 1), the plan also imposes an additional $2,400 tobacco premium surcharge (as in example 2) on employees who have used tobacco in the prior 12 months and who are not enrolled in a tobacco cessation program. Compliant? Yes 50% rule allows for up to $3,000 in incentives; someone who met all the requirements would be able to earn $3,000 worth of incentives ($2,400 + $600). However, the reward levels could not be increased in this example. 8

9 EXAMPLE 4: An employer sponsors a group health plan. The total annual premium for employee only coverage is $5,000. The plan provides a $250 reward to employees who complete a health risk assessment, without regard to the responses or risks identified. The plan also offers a Heart Smart Program which is a health contingent program with an opportunity for a $1500 reward. Compliant? Yes 30% rule allows for $1500 incentive; the $250 reward is part of a participatory wellness program that does not count toward the total allowable reward of 30%/50% 3. Reasonable Design Must have a reasonable chance of improving the health of or preventing disease in, participating individuals Not overly burdensome Not a subterfuge for discrimination based on a health factor Not highly suspect in the method chosen to promote health or prevent disease May include benign discrimination 4. Uniform Availability & Reasonable Alternative Standards Full reward must be available to all similarly situated individuals Must provide a reasonable alternative standard or waive the otherwise applicable standard and provide the reward 9

10 Reasonable Alternative Standards Same, full reward regardless of when alternative is met Flexibility in how you provide reward once alternative is met Can waive standard at any time instead of offering alternative Can provide a particular alternative upon request Can offer individualized alternatives If alternative is health contingent, must comply w/5 requirements Alternative CANNOT be meeting different level of same standard without additional time to comply What qualifies as reasonable? If alternative is completion of an education program, plan/issuer must make program available or assist employee in finding such a program and may NOT require an individual to pay for the cost. Consider time commitment (i.e. requiring nightly attendance at a 1 hour class would be unreasonable) If alternative is a diet program, plan/issuer must pay for cost of any membership or participation fee but NOT the cost of food. Individual s personal physician ALWAYS trumps plan s medical professional plan/issuer may impose standard cost sharing under the plan or coverage for medical items and services furnished. Reasonable Alternatives: more considerations Addiction Overcoming an addiction sometimes requires a cycle of failure and renewed effort Example: Tobacco Cessation Environmental Factors A number of environmental factors can influence an individual s ability to achieve a desired health outcome Example: weight loss and weight management Employer CANNOT cease to provide a reasonable alternative standard 10

11 Reasonable Alternative Standards Difference between Activity Only & Outcome Based Activity Only Alternative or waiver if initial standard is unreasonably difficult due to a medical condition OR it is medically inadvisable to attempt Employer CAN seek verification Outcome Based Reasonable alternative or waiver for ANY individual who does not meet the initial standard based on a measurement, test or screening REGARDLESS of medical condition/health status Employer CANNOT seek verification Apply it Activity Only Example: Reward individuals who participate in a reasonable specified walking program Alternative: If it is unreasonably difficult due to a medical condition for an individual to participate or it is medically inadvisable for an individual to attempt to participate, the employer will waive the walking program requirement and provide the reward. Outcome Based Example: Reward participants who achieve an total cholesterol count of 200 or less. Alternative: If a participant does not achieve the targeted cholesterol count the participant develops an alternative cholesterol action plan in conjunction with his/her physician that may include recommendations for medication and additional screening. The physician can modify the standards of the alternative, as medically necessary, over the course of the year. 11

12 Multi tier Example: Reward participants who have a body mass index that is 30 or lower. 1 st Alternative: Any participant who does not meet the target BMI is given the same discount if s/he complies with an exercise program that consists of walking 150 minutes per week. 2 nd Alternative: Any participant for whom it is unreasonably difficult due to a medical condition to comply with this walking program (or it is medically inadvisable to attempt it) during the year is given the same discount if they meet with a coach three times during the year, regardless of the outcome of the meetings. Where does the requirement to offer additional alternatives end? Offer participatory wellness program as alternative When initial standard or alternative is activity only and participant cannot demonstrate the medical inadvisability or unreasonable difficulty due to medical condition OR fails to get physician verification If initial standard or alternative is waived If employer accommodates physician recommended alternative 5. Notice (of availability of reasonable alternative standards) Must disclose availability of the reasonable alternative standard/waiver in all wellness program plan materials Include: contact information to obtain the reasonable alternative and a statement that recommendations of one s personal physician will be accommodated. Must provide notice along with notice of not meeting initial outcome based standard 12

13 Notice Sample Language Your health plan is committed to helping you achieve your best health. Rewards for participating in a wellness program are available to all employees. If you think you might be unable to meet a standard for a reward under this wellness program, you might qualify for an opportunity to earn the same reward by different means. Contact us at: [insert contact info] and we will work with you (and if you wish, with your doctor) to find a wellness program with the same reward that is right for you in light of your health status. Your health plan wants to help you take charge of your health. Rewards are available to all employees who participate in our Cholesterol Awareness Wellness Program. If your total cholesterol is under 200, you will receive a reward. If not, you will still have an opportunity to qualify for the reward. We will work with you and your doctor to find a health smart program that is right for you. Contact us at [insert contact info] and we will work with you (and if you wish, your doctor) to find a wellness program with the same reward that is right for you. Review: The 5 Requirements 1. Annual opportunity to qualify 2. Size of reward 30% of cost of coverage (50% for tobacco related) 3. Reasonable design (promote health/prevent disease) 4. Uniform availability & reasonable alternatives (make it fair) 5. Notice of reasonable alternatives (make it known) 13

14 Do you offer a group health plan that is fully insured, self insured, large group, small group, nongrandfathered or grandfathered? NO These NEW regulations don t apply; still must comply with previous regulations as well as ADA, GINA, ERISA, HIPAA Privacy, etc. NO Do you offer rewards or include conditions for obtaining a reward that are related to health status? Is the program available to all similarly situated individuals regardless of health status? Activity Only Outcome Based No: Your program is not compliant Yes: Congrats, your program is compliant Activity Only Reasonable alternative (medically inadvisable or unreasonably difficult due to medical condition? Did you notify participants of available alternatives in ALL plan materials? Is the reward offered once per year? Full reward available to all similarly situated individuals?, Hooray! Size of reward 30 50%? Program reasonably designed? Outcome Based Is the reward offered once per year? Size of reward 30 50%? Reasonable alternative standard offered to every individual that did not meet initial standard regardless of health status? Did you notify participants of available alternatives in ALL plan materials? Full reward available to all similarly situated individuals? Program reasonably designed? Notification of alternatives in any disclosure that an individual did not satisfy the initial standard?, Hooray! 14

15 Most people spend their years sacrificing their health to gain their wealth, only later to spend their wealth reclaiming their health. To download a copy of your certificate go to Thank You! Cara Fox Fairbanks cara@whitewaterwellness.com (907)