Human Resources
Agencies Propose New Wellness Program Rules  | Aon

Agencies Propose New Wellness Program Rules


The Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury (the agencies) jointly released proposed regulations regarding nondiscriminatory wellness programs in group health plans on November 20, 2012. The proposed regulations, which would be effective in plan years beginning after calendar year 2013, implement changes made by the Patient Protection and Affordable Care Act (Affordable Care Act).

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) generally prohibits group health plans and group health insurance issuers from discriminating against participants and beneficiaries in eligibility, benefits, or premiums based on a health factor. However, health plans and health insurance issuers may offer premium discounts, rebates, or cost-sharing modifications for participation in a wellness program if the program meets the conditions set forth in HIPAA and the final HIPAA regulations issued in 2006 (the HIPAA wellness regulations). The Affordable Care Act modifies the HIPAA wellness regulations to provide employers and group health plans with additional flexibility in designing wellness programs.

The Aon Hewitt bulletin below describes an overview of the HIPAA wellness regulations and the changes to those regulations as set forth in the proposed regulations, including:

  • The increase in the maximum permissible reward under a health-contingent wellness program from 20% of the cost of coverage to 30%; and
  • A further increase in the maximum permissible reward to 50% of the cost of coverage if the wellness program is designed to prevent or reduce tobacco use.

The agencies propose to extend the proposed regulations to both grandfathered and non-grandfathered group health plans.

Agencies Propose New Wellness Program Rules