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Is Your Wellness Program ACA Compliant?

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Implementing a workplace wellness program offers employers an excellent opportunity to improve the health, productivity and overall morale of employees and to reduce future health care costs. However, …

Implementing a workplace wellness program offers employers an excellent opportunity to improve the health, productivity and overall morale of employees and to reduce future health care costs. However, the question all employers must answer is “How does our organization ensure our wellness program is compliant with the Affordable Care Act (ACA)?” Learn more in this article.

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  • 1. I D E A S T O H E L P G R O W Y O U R B U S I N E S S ©Copyright2014.CBIZ,Inc.NYSEListed:CBZ.Allrightsreserved. I mplementing a workplace wellness program offers employers an excellent opportunity to improve the health, productivity and overall morale of employees and to reduce future health care costs. The question all employers must answer is “How does our organization ensure our wellness program is compliant with the Affordable Care Act (ACA)?” In order to answer that question it is important to know that the ACA divides wellness programs into two types: Participatory and Health-Contingent. An employer’s main focus when introducing either type of program must be avoiding discrimination and providing goals that are obtainable for all employees. Participatory Wellness Program The participatory program is pretty straightforward and centered solely on employee participation, not a specific outcome. An example is offering reimbursement for the employee’s cost of a monthly gym membership. If introducing a participatory program, there should never be a reward or incentive for something outcome based. Also, be sure the health incentives set forth are possible for any employee to complete regardless of health status; for example, completing a health risk assessment or going to one’s annual preventive care appointment. Regardless of the results from the assessment or the biometric numbers obtained at a preventive care appointment, the employee would be rewarded simply because he or she completed the task. Health-Contingent Wellness Program Health-contingent programs can be a bit tricky when looked at from a discrimination viewpoint as they require the employee to meet a specific goal (e.g., stopping tobacco use) in order to obtain a reward. These programs can be broken out further into “Activity Only” or “Outcome Based”. “Activity Only” rewards the employee for accomplishing a certain activity (e.g., walking 30 minutes a day, three days a week), but does not depend on numerical goals like weight loss, BMI or blood pressure. Conversely, “Outcome Based” does not reward an employee for simply participating in an activity but rather requires achieving or maintaining a specific health goal, such as obtaining our business is growing yours Employee Benefits Is Your Wellness Program ACA Compliant? Article reprinted from Spring 2014GROWTHBIZS T R A T E G I E S a BMI of 28 or less. Thus, the model of reward based on outcomes can lend itself to discrimination issues, especially if an employee cannot reasonably accomplish a goal due to conditions such as health status or safety issues. Therefore, it is always necessary to offer alternative means of accomplishing a specific goal or task and make sure the reward is the same as that being offered to other employees. Lastly, the ACA specifies the 2014 maximum permissible reward for health-contingent wellness programs to be 30% of the cost of the employee-only health coverage. This means annual rewards, whether health care premium subsidies or tangible items, cannot exceed this amount. In summary, wellness programs are an effective way for an organization to improve many facets of employee health and wellbeing, as well as to exert some control over future health care costs. Just be cognizant to design a program that is compliant with ACA requirements.

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