Compliance April 13, 2011

Court Finds Wellness Program Incentives not Illegal

April 13, 2011 (PLANSPONSOR.com) – A federal court has dismissed a lawsuit which alleged that financial incentives to participate in a voluntary wellness program as part of a health plan provided to employees violated the Americans with Disabilities Act.
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Business Insurance reports that in Bradley Seff vs. Broward County, U.S. District Judge K. Michael Moore of the U.S. District Court for the Southern District of Florida granted summary judgment to Broward County, ruling that the wellness program falls under the safe harbor provision of the ADA and is based on insurance and risk management principles. “It is clear to this court that the wellness program is not a subterfuge; it was not designed to evade the purpose of the ADA,” wrote Moore, according to Business Insurance. “Rather, it is a valid term of a benefits plan that falls within the ambit of the ADA’s safe harbor provision.”  

The news report said that in 2009, Broward County implemented a wellness program to address rising health care costs and its aging workforce, according to court documents. Under the program, employees were required to take a health assessment test and produce a blood sample to determine glucose and cholesterol levels.   

The following year, the county decided to incentivize its workforce by applying a $20 surcharge per paycheck for individuals not participating in the wellness program.   

Former employee Bradley Seff filed a class action complaint alleging that the county violated the ADA by requiring employees to undergo medical examinations and making medical inquiries about them. According to Business Insurance, Seff argued that the wellness program was implemented not to manage risks but to further a desire to keep employees healthy, court documents said.

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