Employer HSA Contributions

October 25, 2011 5:28 PM

Is it discriminatory for an employer to vary HSA contributions based on an employee's health?

This question is primarily directed at HR and members of the legal community.

My employer implemented a high deductible health insurance plan. In an effort to mitigate some of the additional costs to the employee, they make quarterly contributions to our HSA account (amount of the contribution is 1400 annually, regardless of single/family status). Recently, they sent a memo that stated in 2012 a portion of the HSA contribution would be predicated on each employee participating in a health screening. The specific details would be anonymous to the company, but they would receive a report regarding the general health of their organization. If an employee decides not to participate in the screening, they would only be eligible for a annual contribution of 900 dollars, hence sacrificing 500 dollars). In addition, they also stated that in 2013, in order for an employee to eligible for the maximum contribution, they must pass 3 of 5 health bench marks. If they failed 3 or more tests, the HSA contribution would be reduced by varying degrees (yet to be stipulated).

My immediate question is whether this is legal? Wouldn't this be covered under anti-discrimination laws?

posted by anonymous to work & money (13 answers total)

I know the mandatory semi-anonymous screening is legal and fairly common. Not sure about the 3 of 5, but assuming that the criteria aren't that you're white and below 50, it's probably legal. Not really any different than offering an insurance discount for being a non-smoker.
posted by jferg at 5:51 PM on October 25, 2011

I don't see anything illegal based on what you've said. I'm assuming that the 5 "bench marks" are behavioral not physical/medical. You might want to provide some details to the mods if possible.
posted by HuronBob at 6:07 PM on October 25, 2011

These are the HHS rules for Employee Wellness Programs for group health insurance. You haven't given us nearly enough information to compare your program to these rules, but you can read through them yourself and see.
posted by decathecting at 6:18 PM on October 25, 2011 [2 favorites]

Yeah, there are rules for this sort of thing, but 1) you haven't provided enough information to even begin to offer an analysis, and 2) they can get away with far more than you probably think they can.
posted by valkyryn at 7:06 PM on October 25, 2011

My employer is going down this path. They already have non-smoker "discounts" and next year they're tying it to still not smoking and a health screening. Smokers qualify as long as they're enrolled in a "smoking cessation" program offered.

"Wouldn't this be covered under anti-discrimination laws?"

What's the protected class here? Fat people? And really, the anonymizing goes a long way here. You might give Anti discrimination laws in the US a browse.
posted by pwnguin at 7:55 PM on October 25, 2011

Well, this part...

"...they must pass 3 of 5 health bench marks. If they failed 3 or more tests, the HSA contribution would be reduced by varying degrees."

Seems to contradict this part...

"The specific details would be anonymous to the company, but they would receive a report regarding the general health of their organization."

That first quote seems to say that, in fact, the screenings aren't anonymous.
posted by Thorzdad at 5:19 AM on October 26, 2011 [1 favorite]

(As I read it, the first quote applies to 2013, and the second quote to 2012 -- i.e., the company is taking a structurally more invasive approach each year.)
posted by vers at 7:28 AM on October 26, 2011

As Valkyryn said, there are rules (several different sets) for this type of thing, but your question doesn't give enough information. No one who says "it's legal" or "it's illegal" is correct here, as no one could tell.

Rules that may apply:

HIPAA nondiscrimination rules
State non discrimination rules
ADA
IRS HSA rules
posted by Pax at 7:42 AM on October 26, 2011 [1 favorite]

My employer is doing this. I am not comfortable with the level of security implemented, and am pushing for better answers/better security.
posted by theora55 at 8:33 AM on October 26, 2011

Letters from the EEOC's office of legal counsel on this issue are here and here. Bad (in my view) district court case on this issue here. GINA regulations discuss issue at section 1635.8(b). Related HIPAA reg here. Good luck. I oppose such policies.
posted by ClaudiaCenter at 2:14 PM on October 26, 2011

My company is doing the same thing. I would be interested to hear people's opinions on the HSA contributions being tied to the following standards:

Waist Circumference
Men less than 40 inches
Women less than 35 inches

Triglycerides
less than 150 mg/dL

HDL
Men greater than or equal to 40 mg/dL
Women greater than or equal to 50 mg/dL

Blood Pressure
less than 130/85 mmHG

Fasting Plasma Glucose
less than 100 mg/dl

Employees must pass 3/5 in order to be eligible to 100% HSA contribution.
posted by murp0837 at 10:28 AM on October 27, 2011

Generally, a wellness program that ties an incentive to meeting a health standard would have to follow the rules for wellness programs, which allow an exception to HIPAA nondiscrimination rules (prohibiting discrimination based on a health factor - including weight, BP, etc).

Notably for this example, there would have to be an alternative standard for those not able to reach those standards because of a health factor (e.g. a BP condition, diabetes, obesity), based on whether it would be medically inadvisable or unreasonably difficult due to a medical condition to meet the standard.

http://www.dol.gov/ebsa/faqs/faq_hipaa_ND.html

What are the five requirements for wellness programs which base a reward on satisfying a standard related to a health factor?

The total reward for all the plan’s wellness programs that require satisfaction of a standard related to a health factor is limited – generally, it must not exceed 20 percent of the cost of employee-only coverage under the plan. If dependents (such as spouses and/or dependent children) may participate in the wellness program, the reward must not exceed 20 percent of the cost of the coverage in which an employee and any dependents are enrolled.

The program must be reasonably designed to promote health and prevent disease.

The program must give individuals eligible to participate the opportunity to qualify for the reward at least once per year.

The reward must be available to all similarly situated individuals. The program must allow a reasonable alternative standard (or waiver of initial standard) for obtaining the reward to any individual for whom it is unreasonably difficult due to a medical condition, or medically inadvisable, to satisfy the initial standard.

The plan must disclose in all materials describing the terms of the program the availability of a reasonable alternative standard (or the possibility of a waiver of the initial standard).
posted by Pax at 12:29 PM on October 27, 2011 [1 favorite]

(sorry, I was referring to the latest example, by murp0837, not the OP - the OP was not specific enough).
posted by Pax at 6:43 AM on October 28, 2011