January 25, 2013
Amy Turner
Office of Health Plan Standards and Compliance Assistance
Employee Benefits Security Administration
Room N-5653
U.S. Department of Labor
200 Constitution Ave. NW
Washington, DC 20210
Attention: Wellness Programs
Re: RIN 1210-AB55 Incentives for Nondiscriminatory Wellness Programs in Group Health Plans
Dear Ms. Turner:
The National Partnership for Women & Families appreciates the opportunity to comment on the
proposed rules for employer wellness programs. The National Partnership represents women and
families across the country. As health care purchasers, consumers, and decision makers for themselves
and their families women are keenly interested in wellness and prevention of illness. Employer wellness
programs - if designed and implemented properly - potentially offer women and their families another
avenue for improving and maintaining their health. Health promotion activities such as allowing flextime for walking or other physical activity, offering healthy lifestyle education classes and other
workplace initiatives can encourage women to engage in valuable wellness activities. These programs
can help women achieve their wellness goals by providing activities at a time and location that fits the
time constraints associated with their responsibilities at home and in the workplace.
In previous discussions with the Departments of Labor, Treasury, and Health and Human Services we
have expressed specific concerns about the potential downsides of certain wellness programs if they are
used as a back-door way of discriminating by circumventing the market reforms and protections put in
place by the Affordable Care Act (ACA). In particular we have raised concerns about:
 Allowing employers to tie premium costs to health conditions like weight, cholesterol, and blood
sugar levels under the guise of workplace wellness; programs that include these or similar
provisions may be used by employers to avoid the ACA’s prohibition on medical underwriting;
1875 connecticut avenue, nw ~ suite 650 ~ washington, dc 20009 ~ phone: 202.986.2600 ~ fax: 202.986.2539
email: [email protected] ~ web: www.nationalpartnership.org
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 Employer discretion to design wellness programs that impose large variations in employee
premiums; such wide flexibility poses a twofold problem:
o
First, employees who are unable to satisfy their workplace’s wellness targets may face
substantially higher premiums and find themselves priced out of employer-sponsored
coverage, a development that would undermine the intent and effect of many of the
ACA’s key insurance reforms;
o
Second, large disparities in premiums can lead to adverse risk selection; an employer
that structures its wellness program so as to permit substantial differences in premiums
based on health conditions can use this price differential to force its relatively less
healthy workers - those who cannot meet the program’s health targets - to opt out of
employer-sponsored insurance; while this practice may reduce employer costs, it risks
increasing premium costs for the government and for other individuals who purchase
coverage through insurance exchanges.
 The long-term effect of wellness incentives on employees’ real earnings; increasing the size of
the premium discounts for employees who achieve employer-defined health targets may, over
time, lead to higher base premiums or lower wages.
The National Partnership continues to advocate for meaningful safeguards that prevent discrimination in
the workplace, especially discrimination against low-income women and families. We commend the
Departments for providing additional standards for health contingent wellness programs in the
proposed rule. While we appreciate the Departments publicly acknowledging that the proposed rule is
intended to ensure that a health contingent wellness program is “reasonably designed to improve
health and is not a subterfuge for underwriting or reducing benefits based on health status” this does
not go far enough. The final rule must clearly state that wellness programs cannot discriminate against
women and doing so would violate the ACA’s anti-discrimination provisions, including the prohibition on
gender rating and Section 1557.
Further, the Departments must continue to monitor closely the development and implementation of
workplace wellness initiatives. Only through ongoing and careful oversight of these programs can
women be confident that wellness programs will not be misused to deny anyone access to quality,
affordable insurance coverage.
We understand that the proposed rule does not address wellness program policy for the individual
market since that will be addressed as part of a 10-State wellness project for individual markets. But we
do urge that a proposed rule or guidance for this demonstration program be published as soon as
possible. We further commend the Departments for proposing to apply the same set of standards for
employer wellness programs to both grandfathered and non-grandfathered plans. This approach
guarantees consistency across the market and will protect consumers in a broader range of employment
situations.
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Requirements for Health Care Contingent Wellness Programs
Size of the Reward
We remain concerned that premiums in contingent wellness programs can vary by as much as 30
percent. This wide premium variation is particularly troublesome for those women least able to afford
it. The rule states that few employer plans have come close to the current 20 percent differential and
therefore the Departments do not expect many employers to actually reach the higher 30 percent level.
While it may be true that few employers make full use of the discretion presently afforded them under
the rules, raising the premium variation level still further, to 30 percent, may encourage employers –
especially those looking to lower what they spend on employee health care coverage – to act more
aggressively in this area. Many employers may consider moving from a participatory wellness program
which has no impact on premium costs to a contingent program and/or increasing the premium
differential they currently have in place for their contingent wellness program. Regardless of whether
employers move quickly to take advantage of the new and substantially higher threshold, however, the
fact that they may do so highlights the importance of robust oversight by the Departments to ensure
that these programs are reasonably designed and non-discriminatory.
The rule proposes allowing a 50 percent variation only for tobacco cessation programs. Given the
relative paucity of evidence regarding the effectiveness of large premium variations to alter health
behaviors, we suggest that expanding the 50 percent threshold to cover any other condition-specific
program is not warranted.
The final rule should also clarify that modification of an employee’s copays are permissible only in the
case of rewards tied to copayments or other cost-sharing mechanisms -- not increases in copayments
when targets are not met. Further, the Departments should reject any strategy that would allow
employers to pay for copayment waivers by raising the overall cost of copayments across the board.
Increases in copayments are a known deterrent to utilization of needed health care services and such a
result would run counter to the overall goal of worksite wellness.
Because of the allowed premium and copay variation we are concerned that the proposed rule could
create a greater incentive for employers to move from participatory wellness programs to incentivebased wellness programs. This would have a notable financial impact on women. Therefore the
Departments must closely monitor: 1) how employers are reacting to the increase in premium
differential; 2) the impact that the final regulations have on the affordability of employer-provided
health insurance for employees; and 3) whether employers are using the increased premium allowance
to push costlier employees out of the employer plan and into the insurance exchange.
Finally, we believe that wellness programs should not make family coverage unaffordable. If one
member of the family fails to meet program requirements, other members of the family should not be
penalized. One way to address this is by prorating rewards. For example, if a spouse fails to meet a
wellness program standard and the penalty is a 30% premium increase, the increase should be 30% of
the spouse’s share of the premium. This would help ensure that family coverage does not become
unaffordable if one member of the family is unable to meet wellness requirements.
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Uniform Availability and Reasonable Alternative Standards
We support the rule’s clarification that plans and issuers cannot stop providing an alternative standard
to a contingent wellness program simply because it wasn’t successful before. For women who are trying
to quit smoking or lose weight finding the right program is key to their eventual success. We further
suggest the Departments clarify for employers what constitutes a timely manner of response when an
individual requests an alternative standard.
The rule proposes several factors that will need to be taken into account in determining whether a plan
or issuer has provided a reasonable alternative standard. We generally agree with the factors outlined
in the rule but suggest some clarifications to further strengthen the factors.
 The rule proposes requiring the plan or issuer to make an educational program available instead
of requiring employees to find a program on their own. We suggest that the Departments also
clarify that the program is a reasonable alternative only if it is accessible by the employee – for
instance offered online or offered on-site during working hours. For women who have
caregiving responsibilities or who work more than one job, easy accessibility is an important
issue.
 The rule states that if a reasonable alternative standard is a diet program, the plan or issuer
must pay for membership but is not required to pay for the cost of food. We suggest that the
Departments also require that the diet program be chosen in consultation with the employee
who may have a preference for a type of program best suited for her. The employee will also be
better able to ascertain whether any costs that might be associated with purchasing food are
affordable.
 We support the rule’s clarification that it is not reasonable for a plan or issuer to ask for
physician verification for a claim that is obviously valid based on the nature of the employee’s
medical condition.
 We support the requirements that the individual’s physician’s prescription must be
accommodated in the alternative standard and that the opinion of the personal physician
preempts that of a medical professional acting as an agent of the employer or the plan. It is
important that this provision be written in a way that explicitly applies broadly to any
individuals, including dependents if they are participating fully in a program, as part of an
alternative standard or reasonable means of qualifying.
We also recommend that the rules make explicit that employees have the means to appeal when they
do not believe that the standard or alternative standard is appropriate or when they want to appeal a
determination that they failed to meet a standard. The Departments should require employers to
clearly and effectively notify their employees about the availability and operation of the appeals
process.
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Reasonable Design
The final rule must clearly state that for a program’s design to be “reasonable,” it must be nondiscriminatory based on all of the characteristics protected under Section 1557 of the ACA. The
proposed rule only discusses discrimination based on a health factor. The final rule must make clear
that health-contingent programs must comply with existing protections against discrimination based on
race, color, national origin, sex, age, and disability.
We further believe a reasonably designed wellness program should be individually-tailored and focused
on the health and well-being of each employee. Employers should take into account personal
circumstances, including family caregiving responsibilities or multiple jobs that may make it difficult or
impossible for employees – especially women – to participate in wellness efforts that take place outside
normal work hours. We suggest that the Departments include an example for employers of what might
constitute overly burdensome based on personal circumstances – for example a single parent who
cannot visit the gym before or after work.
The Departments are also seeking comments on whether certain standards, including evidence- or
practice-based standards, are necessary to ensure that wellness programs are reasonably designed to
promote health.
In considering the definition of a “reasonably designed program” we urge the Departments to consider
accredited wellness programs – like those that have achieved NCQA standards. NCQA’s Wellness and
Health Promotion Accreditation program – which includes input from the consumer community requires program vendors to document that they meet clear, high standards for:
 Health appraisals and coaching;
 Targeted preventive health services information to participants;
 Identification and follow-up, including referral tracking, for individuals with wellness or health
promotion needs;
 Evidence-based services to increase health awareness and health management skills, including
access to self-management tools and opportunities for engagement/activities;
 Protections for participants’ confidential information;
 Easy-to-understand information about incentives; and
 Alternatives for people with medical conditions or other difficulties in achieving goals.
These requirements parallel recommendations published last year in a consensus statement of the
Health Enhancement Research Organization, American College of Occupational and Environmental
Medicine, American Cancer Society and American Cancer Society Cancer Action Network, American
Diabetes Association, and American Heart Association.1
1
Guidance for a Reasonably Designed, Employer-Sponsored Wellness Program Using Outcomes-Based Incentives© 2012
American College of Occupational and Environmental Medicine,
http://www.acoem.org/uploadedFiles/Public_Affairs/Policies_And_Position_Statements/JOEM%20Joint%20Consensus%20Stat
ement.pdf
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Affordability
The final rule should clarify how wellness incentives and penalties will interact with other affordability
provisions in the ACA. In the case where a larger premium is assessed on employees who do not meet
wellness incentive requirements, that larger premium should always be used when determining
whether an employee’s offer of employer-sponsored coverage is affordable. This could be a premium
before a wellness premium discount or rebate is applied or, depending on how the incentive is designed,
it could be a premium including an additional wellness premium surcharge. If this larger premium would
make employer-sponsored coverage unaffordable for a worker based on the 9.5% of income threshold,
that offer of employer-sponsored coverage should be considered unaffordable for the purpose of
determining eligibility for premium tax credits and the employee should be able to enter the exchange
and the employer should be faced with the appropriate penalty.
Informing Consumers
The sample language included in the proposed rule should fully inform an employee of what her
financial responsibility may be with respect to wellness programs. For instance, an employer should
fully explain an extra incentive payment versus a surcharge or lack of a surcharge. There should be no
question on the part of any employee as to what the financial obligation is of participating or choosing
not to participate in an employer wellness program.
Conclusion
We appreciate the opportunity to provide comments on the proposed rule. Ensuring that workplace
wellness programs are designed and implemented in ways that do not discriminate against women is
critical. We look forward to continuing to work with the Departments on this particular rule as well as
other implementation issues. If you have any questions regarding our comments, please contact Kirsten
Sloan at 202-986-2600 or [email protected].
Sincerely,
Debra L. Ness