Human Resources
If at First You Don’t Succeed, Try, Try Again: Agencies Require Reasonable Alternatives for Individuals Who Fail Health-Contingent Wellness Programs

If at First You Don’t Succeed, Try, Try Again: Agencies Require Reasonable Alternatives for Individuals Who Fail Health-Contingent Wellness Programs


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Employer group health plans that offer health-contingent wellness programs must provide employees who fail to meet the health contingency with a reasonable alternative in order to receive the full amount of any reward or incentive, according to final regulations released May 29, 2013 by the Departments of Labor, Treasury, and Health and Human Services (the agencies). However, the conditions under which a wellness program must offer a reasonable alternative to an individual who fails to meet the health contingency will now depend on whether the wellness program requires the employee to engage in an activity or to achieve a specific health outcome.

The final regulations, which are applicable in plan years beginning after 2013, apply to all group health plans, whether or not grandfathered. They also increase the maximum possible rewards that a wellness program may provide to employees as amended by the Patient Protection and Affordable Care Act (Affordable Care Act). The Aon Hewitt bulletin below discusses the regulations and the impact on employer wellness programs.

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