Employer-sponsored wellness programs are subject to numerous federal laws and regulations to ensure nondiscrimination, including HIPAA, the ADA and GINA. Depending on the design, a wellness program may be subject to some or all of these laws.

The final HIPAA rule, in effect since January 2014, regulates the incentives employers may provide to employees for participating in wellness programs tied to a group health plan. The final ADA rule regulates an employer’s use of wellness program incentives as a means for encouraging employees to answer disability-related inquiries or agree to medical exams. The final GINA rule regulates the use of incentives with regard to wellness programs that collect genetic information on employees’ family members. Both the ADA and GINA final rules are applicable on January 1, 2017. All three laws and their final rules are discussed in more detail below.

Promote Health or Prevent Disease

HIPAA, ADA, and GINA all require that wellness programs “be reasonably designed to promote health or prevent disease”. Therefore, any program that falls under any of these laws must:

  • Have a reasonable chance of either improving health or preventing disease;
  • Not be overly burdensome on the participant;
  • Not be a subterfuge for violating non-discrimination laws; and
  • Not chose a method that is highly suspect.

For example, if a program’s health risk assessment (HRA) shows that there is a high rate of occurrence of a specific medical condition, the program could satisfy the health improvement requirement by implementing a special education or prevention program targeting that medical condition. Likewise, if the HRA requires a visit to a physician for diagnostic tests or uses participant answers to direct each participant to education materials on their specific health conditions, then the HRA would be providing feedback with a reasonable chance of improving health or preventing disease. On the other hand, if there is no follow-up or feedback to the participants at all, the program would not satisfy the requirement since it does nothing to improve health or prevent disease.

Wellness Incentive (Financial or In-Kind; Reward or Penalty) Limits

Under all three laws, incentives refer to either financial or in-kind (e.g., non-monetary awards, prizes, or other items of value) and could be provided in the form of a reward or penalty. The maximum incentive is set at 30% of the total cost of the premium for single coverage, with some exceptions. Each law’s incentive limits apply to the total incentives a participant would be eligible to receive from all wellness programs regulated by that law.


  • Only applies to health-contingent wellness programs that are tied to a group health plan.
  • Does not apply to any participatory wellness programs or to those health-contingent wellness programs that are completely separate from a group health plan.
  • Exceptions to 30% limit:
    • Permits up to a 50% premium surcharge for tobacco use.
    • If dependents, including a spouse, are eligible to participate in the wellness program, the maximum incentive is based on the total cost of the coverage for the employee and enrolled dependents.


  • Applies to all wellness programs (health-contingent and participatory) that include disability-related inquiries or a medical examination, whether tied to a group health plan or not.
  • Does not apply to certain participatory programs, such as those that solely provide, rather than collect, information (e.g. nutrition, weight loss, or smoking cessation educational programs that do not collect health information). Conversely, the ADA limit would apply if a program includes a biometric screening (medical exam), such as testing for nicotine.
  • Since programs might not be tied to a group health plan, the 30% limit is applied based on either the plan the employee enrolled in, the lowest cost plan the group offers, or the second lowest cost Marketplace silver plan for a 40-year-old non-smoker in the employer’s home state.


  • Applies to any program that solicits genetic information, whether tied to a group health plan or not.
    • Genetic information includes information regarding the manifestation of disease or disorder in an individual’s family member (aka family medical history).
    • Tobacco use is not genetic information, so GINA would not apply to smoking cessation programs, even if biometric screening is part of the program requirements.
  • Like the ADA, the 30% limit is applied based on either the plan the employee enrolled in, the lowest cost plan the group offers, or the second lowest cost Marketplace silver plan for a 40-year-old non-smoker in the employer’s home state.
  • Exception to 30% limit: applies separately for the employee and spouse; they are each subject to the 30% of single coverage limit independent of the other. For instance, when there are multiple incentive opportunities for the employee, the total cannot exceed 30%; however, the spouse incentive can be a separate amount up to an additional 30%. It is important to note that a program may be subject to GINA as well as ADA limits which do not allow for this increase exception.

Voluntary Participation Requirement Under the ADA

The ADA prohibits employers from utilizing disability-related inquiries or medical exams, but make an exception for voluntary participation in a wellness program. To ensure participation in a wellness program is voluntary, such as completing an HRA, the final ADA rule (1) restricts incentive amounts (as described above) to keep cost from being coercive and (2) outlines four other required factors:

  1. Participation cannot be mandatory;
  2. Coverage under the group health plan or other benefits cannot be denied based on lack of participation;
  3. No adverse employment action or other discrimination, retaliation, or coercion, etc. can occur based on participation or whistle-blowing; and
  4. Written notice must be provided that clearly explains what medical information will be collected, how it will be used, and the disclosure restrictions, including who will have access and the protections set up to prevent improper disclosure.

Special Restrictions on Incentives Under GINA

Under the final GINA rule, incentives are allowed to induce an employee’s spouse to provide his or her own family medical history but only if the spouse gives a voluntary, informed written consent. Incentives are not allowed to induce:

  • An employee’s spouse to provide his or her own other genetic information, such as genetic test results;
  • An individual to provide any genetic information, including family medical history, about an employee’s child, including an adult child; or
  • Agreement to sell or release the individual’s genetic information.

With regard to the first two restrictions, an incentive may still be offered as long as it is clear to the participant that the incentive will be provided even if those questions are unanswered.


Under previously established HIPAA, ADA, and GINA regulations, employee medical information obtained from participation in wellness programs must be maintained in separate files, kept confidential, and may not be used for any employment or benefit-related purposes. The HIPAA and GINA regulations did not add any new confidentiality provisions. The final ADA rule adds that medical information collected through the wellness program may only be disclosed to an employer in aggregate form without revealing individual identities.

Employer Actions

Existing wellness programs may need to be adjusted to ensure compliance with each of the incentive limitations and voluntary participation status. For example, employers should not deny access to medical coverage due to refusal to participate in a wellness program, but may charge more or less for coverage, subject to the limits. For assistance with your wellness program, please contact your Keller account team.