EEOC v. Flambeau Case Update

Posted by Barbara J. Zabawa | Jan 26, 2017 | 0 Comments

Just over a year after the US District Court in the Western District of Wisconsin decided in favor of wellness programs that require employees to pay 100% of their health insurance premium if they refuse to participate in an HRA or biometric screen, the US Court of Appeals for the Seventh Circuit in Chicago let that decision stand.  Recall that the EEOC appealed the district court's decision to the Seventh Circuit and that during oral argument before the panel of appellate judges, the judges inquired as to whether the employee suffered any injury in the case. 

On January 25, 2017, the Seventh Circuit issued its opinion in the case and not surprisingly, based on the judges' comments at oral argument, decided that there was no injury to the employee and therefore the case is moot.   The Flambeau employee who brought the original complaint against his employer for requiring him to take the HRA and biometric screen had resigned his position in March 2014, six months after the EEOC filed its lawsuit against Flambeau.  The court concluded that, given the circumstances, the employee was not entitled to any monetary damages and the legal and factual landscape has changed since 2012 (when Flambeau's wellness program required employees to take HRAs and biometric screens). 

Now, we have the EEOC regulations issued in May 2016 and Flambeau no longer requires HRAs and biometric screens as part of its wellness program.  Indeed, the Seventh Circuit noted that Flambeau halted the mandatory HRAs and biometric screens in part because it found that its employees were not using the test results to change their behavior.  Opinion, at 12. 

Because the Seventh Circuit found the case moot, it did not address the legal question of whether the ADA insurance safe harbor can apply to workplace wellness programs.  Applying the insurance safe harbor would allow wellness programs to “require” employees who were part of an employer's health plan to take HRAs and biometric screens or face paying the full health insurance premium. 

The Seventh Circuit's decision to not weigh in on that legal question means that the District Court's analysis of the insurance safe harbor within the ADA still stands.  Which, as I mentioned in a previous blog post, was the opposite conclusion reached by the Orion Energy court last fall. Which means that using the ADA insurance safe harbor for workplace wellness programs is risky and in violation of the EEOC ADA rules.  So until you hear differently, don't rely on the ADA insurance safe harbor for your wellness program.

About the Author

Barbara J. Zabawa

Attorney Barbara J. Zabawa started the Center for Health & Wellness Law, LLC after she recognized a need for legal services that shared a mission with providers to improve patient outcomes and population health, encourage wellness, protect patient interests in choice of provider and treatment options, provide holistic care, and expand information access. Attorney Zabawa has 20+ years of experience in the health care field, first receiving her Master's in Public Health from the University of Michigan before attending law school at UW Madison, where she graduated with honors in 2001. From 2003-2005, Ms. Zabawa clerked for the Honorable Barbara B. Crabb in the United States District Court for the Western District of Wisconsin and worked on a variety of matters, including employment, patent infringement, civil rights, and contract matters. She also served as a Skadden Fellow representing health care consumers on both the national and local level by helping consumers navigate private insurance coverage issues and advocating for their interests as a Funded Consumer Advocate at the National Association of Insurance Commissioners (NAIC). Attorney Zabawa has worked for a large health insurance company providing advice on the Affordable Care Act as well as HIPAA Privacy and Security compliance. In addition, she was in private practice at a large regional law firm for seven years, where she was a shareholder, led her firm's health care team and served as its HIPAA Privacy Officer. While in private practice, she handled a variety of health law matters, such as compliance with fraud and abuse laws, professional scope of practice matters, state licensing issues, HIPAA privacy and security compliance, Medicare and Medicaid reimbursement and conditions of participation compliance, Accountable Care Organization and other joint venture agreements, employment agreements, as well as business litigation. Attorney Zabawa is the author of the forthcoming book "Rule the Rules of Workplace Wellness Programs." She is a frequent speaker and writer both nationally and regionally on workplace wellness program compliance, the Affordable Care Act, fraud and abuse issues and HIPAA compliance. She has published several law review articles in the practice of health law and has been interviewed by TV, radio and print media regarding wellness, health reform, and HIPAA. She is a Board Member for Rogers Memorial Hospital Foundation, Board President for the Wisconsin Alliance for Women's Health, Board Member for Health Promotion Advocates, and currently serves on the Oversight Advisory Council for the Wisconsin Partnership Program and the State Bar Health Law Section Board. Education JD - University of Wisconsin Law School, cum laudeMPH - University of Michigan School of Public HealthBA - Lawrence University Admitted to Practice: • New York• Wisconsin• Federal District Court of the Western District of Wisconsin• Federal District Court of the Eastern District of Wisconsin• Court of Appeals for the Seventh Circuit• United States Supreme Court


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