U.S. Department of Labor
Health Benefits Advisor for Employers
Determining Compliance with the HIPAA Provisions in Part 7 of ERISA
Compliance with the Wellness Program Provisions
Does the program discriminate based on a health factor?
A plan discriminates based on a health factor if it requires an individual to meet a standard related to a health factor in order to obtain a reward. A reward can be in the form of a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing mechanism (such as deductibles, copayments, or coinsurance), the absence of a surcharge, or the value of a benefit that would otherwise not be provided under the plan.
Example 1: Plan participants who have a cholesterol level under 200 will receive a premium reduction of 20 percent. In this Example 1, the plan requires individuals to meet a standard related to a health factor in order to obtain a reward.
Example 2: A plan requires all eligible employees to complete a health risk assessment to enroll in the plan. Employee answers are fed into a computer that identifies risk factors and sends educational information to the employee's home address. In this Example 2, the requirement to complete the assessment does not, itself, discriminate based on a health factor. However, if the plan used individuals' specific health information to discriminate in individual eligibility, benefits, or premiums, there would be discrimination based on a health factor.
