District Court Rules Medical Exams are Voluntary

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The Eastern District of Wisconsin has decided the case of Equal Employment Opportunity Commission (EEOC) v. Orion Energy Systems, granting summary judgment in part favoring Orion’s argument that their wellness program was voluntary. The case allows Orion to require a Health Risk Assessment (HRA) as a part of its wellness program under the Americans with Disabilities Act (ADA).

In 2009, Orion started a wellness initiative. The employees would have to complete an HRA or pay the entire monthly premium. The HRA included a health history questionnaire and biometric screening involving a blood pressure check, height, weight, and body circumference measurement, and blood draw and analysis.

Orion did not receive any personally identifiable information as a result of the HRA. The nameless, aggregated data allowed Orion to see the percentage of participants in its plan who had particular health risks. Orion used the wellness program as a tool to find common health issues and offer employees education or assistance to improve their health.

Wendy Schobert, an employee at Orion questioned the confidentiality of the HRA and chose not to participate. She then had to pay 100% of her premiums to be covered by the group health plan. Schobert complained about the cost. She received a warning from her supervisor about her complaints and was advised to keep her opinions to herself. Schobert was terminated for sending out an email criticizing the CEO of Orion. Orion fired her on the grounds that her complaints were lowering morale in the office.

The EEOC sued Orion claiming that the Orion Wellness Initiative violated a section of the ADA which states that a covered entity cannot require a medical examination or make inquiries as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless the examination or inquiry is job-related and consistent with business necessity.

The EEOC alleged that the HRA was not voluntary within the meaning of the ADA regulations. The EEOC also argued that the wellness program incentive amount went over the 30% maximum allowed incentives from the 2016 ADA Final Rules.

Orion claimed that the wellness initiative did not violate the ADA:

  1. Orion claimed that the wellness program is covered by the ADA’s safe harbor provision that allows plan sponsors to use information, about risks to make decisions about the cost of insurance.
  2. Orion did not make inquiries because it received only anonymous, aggregated employee responses and results from the HRA.
  3. Lastly, the wellness program was voluntary because employees had a choice whether or not they wanted to participate.

The court disagreed regarding the Safe Harbor provision because data was not used to underwrite, classify, or administer risk. The court agreed with Orion that the program is voluntary. A section of the ADA permits employers to conduct voluntary medical examinations, including medical histories, if they are part of an employee health program available to employees at that work site. Orion’s wellness initiative was also optional. Orion employees were not required to participate in the program and they were instead given a choice to either complete the HRA as part of the health program or pay the full amount of the health benefit premium.

The court did not grant summary judgment on the EEOC’s retaliation claim. The court said that an employee may engage in a protected activity even if the challenged practice is not actually illegal. The employee must have a sincere and reasonable belief that they are opposing an unlawful practice. In this case. Schobert expressed concern about the confidentiality of her medical information. Since confidentiality of medical information is something that the ADA does govern, her expression may have been covered. The retaliation claim will go to trial.

The court said that the requirement that non-participants pay 100% of their premiums did not violate the 2016 rules that set the 30% limit, because those rules cannot be applied retroactively.

Before setting any wellness program incentives, employers should check to see which of the ADA/Genetic Information Nondiscrimination Act rules apply to their wellness programs. Remember that as long as the participation in wellness programs and HRAs are voluntary, the biometric screening/ HRA does not violate the ADA wellness program rules.