Employers are turning more and more to preventative wellness programs to keep down their employee's eventual healthcare costs, including biometric screenings to determine early risk factors. But when those screenings are mandatory, and incentivized through sanctions for opting out rather than rewards for opting in, does that cross the line into violating employee's privacy? Has the employer overstepped its role as a healthcare payor?

That's the question that's at stake in a Minnesota lawsuit, filed last week against Honeywell by the Chicago-based Equal Employment Opportunity Commission (EEOC), a federal law enforcement agency charged with enforcing employee discrimination laws. The suit alleges that Honeywell's employee wellness program can cost employees up to $4,000 in surcharges and lost HSA funds -- $2,000 of which is referred to as a "tobacco surcharge" -- if they and their spouse refuse to undergo a biometric screening that includes a blood test. They say that this violates both the Americans with Disabilities Act and the Genetic Information Nondisclosure Act. (Although genetic testing is not involved in Honeywell's program, the EEOC claims that requiring spouses to be tested constitutes an unlawful demand for family medical history.)

Honeywell called the lawsuit frivolous in a public response that stressed their programs' compliance with two other federal programs -- the Affordable Care Act and HIPAA -- while not directly addressing the complaints about the ADA and GINA. 

"The Chicago EEOC office is unfamiliar with the details of our wellness programs and woefully out of step with the healthcare marketplace and with the core intent of the Affordable Care Act (ACA) to provide expanded access and improved healthcare to all Americans," the company said. "The incentives in our wellness programs are pro consumer and have delivered demonstrably better healthcare outcomes for employees and their families. The incentives we provide are specifically sanctioned by two separate federal statutes -- the Health Insurance Portability and Accountability Act (HIPAA) and the ACA. Honeywell’s wellness plan incentives are in strict compliance with both HIPAA and the ACA’s guidelines, which were designed by Congress to encourage healthier lifestyles while helping to control healthcare costs. No Honeywell employee has ever been denied healthcare coverage or disciplined in any way as a result of their voluntary decision not to participate in our wellness programs."

That the intervention works and that it's sanctioned by HIPAA and ACA don't really address the core issue of employee privacy. The ADA and GINA exist to protect employees -- to make sure, for instance, that companies can't screen all their employees and simply fire the ones who are most likely to have expensive health problems the company could be required to pay for. Those rules say that for an employer to require a mandatory medical test, that test must be directly related to the employee's ability to perform job functions.

But Honeywell's reference to HIPAA and the ACA are very relevant when the potential consequences of the case are considered. By appealing to those laws, Honeywell is setting up the federal government in a battle against itself. If those laws are found to conflict, the courts will have to decide which to enforce. Whatever ruling is made will answer the question of what is a higher priority for the government: Lowering healthcare costs or protecting employee privacy? Or perhaps the ruling will simply clarify ways employers can and should do both -- like offering opt-in incentives rather than opt-out sanctions for voluntary screenings.