The Genetic Information Nondiscrimination Act of 2008 (“GINA”) becomes effective November 21, 2009, applies to businesses with 15 or more employees, and is likely to have a potentially significant impact on a variety of employer obligations, policies and practices. For example, GINA will impact existing Company employee handbook policies, practices relating to medical and physical examinations, wellness programs, and record-keeping and training practices. In addition, effective immediately, employers must post the new version of the EEOC poster – “Equal Employment Opportunity is the Law” – which incorporates both GINA’s new requirements as well as changes made by the recent amendments to the Americans with Disabilities Act (“ADA”), which took effect on January 1, 2009.

For more information, click on the following link:  http://www.jdsupra.com/post/documentViewer.aspx?fid=af5f4c95-fa50-41cb-9f9c-dd0fce63ca46.  This link takes you to a three page summary of GINA in either a Word or PDF format, which was written by Stefan.  Additionally, if you go to this link, you can obtain a free EEOC compliance poster, which includes GINA.  This two page poster is produced by the EEOC and is in PDF format.

1. Jacquie Seemann

Partner at Thomson Playford Cutlers

This is fascinating from an Australian perspective. We have nothing like GINA – the closest we come is provisions in our disability discrimation legislation which prohibit discrimination on the ground of a ‘presumed’ disability, including a presumed future disability.

2. Charles Krugel www.charlesakrugel.com

Regarding Jacquie’s comment about perceived disability, it’s the same in the U.S. under our federal & most state disability laws.

Not sure how GINA is any different from perceived disability when, based on my casual assessment of it GINA, it doesn’t appear to differ greatly from the perceived disability status.

Possibly, this is a matter of the U.S. Congresses addressing an issue that’s already been addressed in prior legislation; i.e., they’re calling greater attention to a hot and developing medical and privacy issue.

Speaking of privacy, I’m also, not sure of the GINA implications or overlaps with HIPPA either. Hopefully, these concerns will be addressed sooner rather than later.

3.        Stefan R. Miller

California Employment Law Attorney, Independent Workplace Investigator, Trainer and Principal of The Employers Law Group

I agree that there is a lot of overlap between GINA’s prohibitions and existing laws prohibiting perceived disability discrimination, including discrimination against someone for having a record of impairment (e.g., cancer). Like Charles, I agree that part of this is Congress’ effort to raise the profile of an emerging issue, particularly in the face of what appears to be some sort of significant legislative changes on health care. The big target of GINA was the health insurance industry but since a lot of information feeds through to health insurance companies from employers, I suspect Congress felt that they need to include protections in this particular piece of legislation. GINA also applies to employer-sponsored health insurance plans and, therefore, prohibits collection/use of genetic information in that sphere as well.

While I do not profess to be a GINA “expert”, I’ll take a stab at trying to identify some “new” wrinkles to GINA which fill in prior “gaps” in the law.

1. GINA establishes clear prohibitions about even seeking/collecting genetic information in the first place both through pre-employment and job pre-qualification medical examinations as well as in connection with wellness programs.

2. GINA also codifies into statute privacy provisions relating to how genetic information – including information inadvertently learned by the employer – must be handled/protected. I don’t know whether there are other existing federal statutory provisions that occupy this space. (In California, we have the Confidentiality of Medical Information Act.)

3. Notwithstanding substantial overlap with perceived disability discrimination under the ADA, there appears to be a subtle gap filled in by GINA. (I add this caveat: being out here in California where plaintiffs rarely sue under federal law — as California law is significantly more favorable — I will defer to those with more knowledge of ADA.) One thing GINA appears to be driving at is the notion of discriminating against someone because of the possibility one is susceptible to one day having a disease or genetic condition at some point in the future due to family history. I don’t believe that is covered under the ADA. In other words, the employer learns (either through an inadvertent self-disclosure or through a pre-employment medical exam) that Applicant’s sibling or parent was just diagnosed with a serious form of cancer. While there is no evidence that Applicant has the disease or that the employer believes Applicant is presently disabled in any way, employer refuses to hire Applicant for fear that at some point in the future, Applicant will become disabled. Another example would simply be if an employer terminated Employee X after learning that a sibling or parent has some form of cancer out of a generic concern employee would one day get the same cancer and have increased health insurance premiums or become disabled — even if employer contends it had no knowledge of Employee X having cancer and that, in fact, employer did not believe Employee X had cancer.

4. Even on the HIPAA/GINA issues, here again, I believe the changes are primarily on the insurance side. However, I believe that HIPAA still governs and applies to unauthorized disclosures of genetic information, an areas that GINA does not address. As for insurance issues, my understanding is that HIPAA permitted underwriters to use genetic information for underwriting purposes. GINA prohibits health insurers from collecting/using genetic information for underwriting/eligibility. My further understanding is that, while HIPAA already provides some protection against genetic discrimination in group insurance, GINA extends coverage to the individual insurance market.

I’d be interested in hearing anyone else’s thoughts or insights.

- Stefan

Stefan R. Miller wrote:

Here’s another resource I recently came across at John’s Hopkins Genetics & Public Policy Center. Consistent with our prior discussion about the primary purpose of GINA, it appears that most of the information on their website is focused on the health care side. But here are some FAQs which are also directed at employment discrimination:http://www.dnapolicy.org/gina/faqs.html

I know there are a few other limited exceptions but I also came across something else I had not seen previously which mentioned an employer can conduct genetic testing if expressly authorized by the employee and if the information does NOT go to the employer but instead goes only to the employee and his/her treating health care providers. I presume this is in connection with an employer wellness program but there was no specific citation or reference.

2008 Per-Employee Health Care Costs To Exceed $9,300; Wide Disparities Foreseen

By Stephen Miller, October 2007

[From SHRM Online's Compensation & Benefits Focus Area]

The average corporate health benefit expenditure in 2008 will be $9,312 per employee “an increase of 7 percent over 2007″ with annual per-employee contributions exceeding $2,000, according to Towers Perrin’s 2008 Health Care Cost Survey.

But while the cost trend is broadly holding steady, there are significant cost differences for companies that are actively and effectively managing program performance. Those “high-performing companies” will see annual per-employee costs of about $1,500 less than low performers in 2008, or nearly a 20 percent differential, according to the firm’s analysis.

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‘High-performers’ will see per-employee health costs
nearly 20 percent lower than ‘low-performers.’
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The survey database includes information on the health benefit programs provided by more than 300 of the nation’s largest employers, covering nearly 6 million U.S. employees, retirees and dependents.

“The good news is that, for the first time in over a decade, we are seeing a number of companies keeping cost growth near the Consumer Price Index for medical services (medical CPI), which currently stands at about 4 percent,” said Dave Guilmette, managing director of the Towers Perrin health and welfare practice.

In flat dollar terms, 2008 gross health care expenditures are expected to rise by an average of $577 per employee, to an average total cost of $9,312. Employers are expecting to subsidize 78 percent of next year’s premium costs, and employees will have to cover the remaining 22 percent, plus usage-based co-pays, deductibles and co-insurance.

While Towers Perrin foresees the employer-employee premium cost share remaining the same as the 2007 split, the accelerated increase in the actual employee contribution “combined with decreasing benefit values” means that the 22 percent employee share actually buys less coverage than in past years. For example, the incremental out-of-pocket cost employees will assume in 2008 because of plan design changes is approximately $200.

Employee contributions, on average, will jump by $156 per employee per year to $2,040, an 8 percent increase that is roughly twice that of annual employee merit increases. The combined effect is that over the past five years, out-of-pocket costs for employees have essentially doubled, a clear indication of how pronounced the affordability issue remains, particularly for low-wage workers.

Coverage Levels Breakdown

Analyzing the data by coverage level, the average reported 2008 cost of medical coverage will be:

• For active-employee-only coverage: $4,704 per year ($392 monthly).

• For employee-plus-one-dependent coverage: $9,660 per year ($805 monthly).

• For family coverage: $13,704 per year ($1,142 monthly).

The total cost for retirees under age 65 is the highest in the survey, at $569 per month for retiree-only coverage ($6,828 annually), and more for coverage that includes dependents.

Employers continue to shoulder most of the burden. Of the total 2008 premium increase of $577:

• Employers will pay, on average, $421 more per employee.

• Employees will pay, on average, $156 more.

In addition to premiums, active employees and their dependents can expect a co-pay of about $20 for regular doctor office visits and a $30 co-pay for specialist visits.

Under plans with co-insurance, employees will pay about 35 percent of the cost of an office visit. Active employees and their dependents will pay, on average, $10 for generic prescriptions and $25 for brand-name prescriptions in 2008.

Active Management Matters

Among positive news for employers and employees, the survey shows that, for 2008, a number of companies have succeeded in keeping a tight rein on the cost of their own programs and, as such, are helping to keep the overall rate of increase dramatically lower than the double-digit jumps experienced four to eight years ago.

Many companies, however, remain unclear on how to balance health care cost pressures with workforce goals and continue to experience cost increases more characteristic of the late 1990s. The result is wide variation in employer and employee cost burdens among similarly sized companies. For example, the 2008 data show that nearly a quarter of companies (22 percent) are still experiencing increases of 11 percent or more.

To better understand the factors that contribute to cost variation for the past three years, Towers Perrin divided respondents in its annual health care cost database into three categories: low-performing, average-performing and high-performing companies. Performance designations are based on relative costs and cost increases, as well as whether an organization is meeting its health benefit objectives in such areas as efficient purchasing, employee engagement and managing health risks in the employee population.

The Art of the Possible

While nearly a quarter of the survey respondents continue to struggle with double-digit cost increases, nearly half of the high performers are managing to get their increases much closer to the medical CPI of about 4 percent.

Among high performers, 45 percent have cost increases of 5 percent or less evidence, in Towers Perrin’s view, that active management of program performance is an exercise in the “art of the possible,” and an increasingly urgent mandate for companies still experiencing double-digit growth rates.

High-performing companies aren’t simply shifting costs to their employees to keep their costs low but rather are employing a broad range of tactics and strategies to hold the line on costs for both the company and employees. In fact, employees at high-performing companies will pay significantly less than employees at low-performing companies “approximately $1,836 per year (on average) vs. the $2,256 employees at low-performing companies will pay in 2008, according to the survey report.

Retiree Health Trends

The survey data indicate that organizations are taking a different view and exhibiting different commitment levels to programs for retirees. Less than half of the companies Towers Perrin surveyed (47 percent) currently subsidize retiree medical coverage for current or future retirees. (SHRM’s 2007 Benefit Survey Report showed that 35 percent of SHRM members provide retiree health benefits, although 53 percent of large employers did so.)

Of those that are continuing a subsidy, the share they are asking retirees to provide is rapidly increasing, Towers Perrin found, particularly for retirees under age 65. In 2008:

• Retirees under age 65 will pay, on average, $3,324, an 8 percent increase.

• Retirees over 65 will pay, on average, $1,500, a 5 percent increase.

The long-term effect of cost shifting to retirees could be to encourage older workers who want to leave the workforce to stay in their jobs primarily to receive company-subsidized health care, the report predicts.

Crain’s Chicago Business recently published the following article about wellness programs. It cites a program implemented by my associates over at The Horton Group for their own employees (I’ve published some of Horton’s materials on this blog).

To fight back against rising health care costs, employers are rewarding workers who lose beer bellies, flabby fannies

Employees at Horton Group in Orland Park have been bypassing prime parking spaces near their office’s entrance for spots deep in the lot.

It’s not that they’ve enjoyed February’s single-digit temperatures. The more they walk, the more points they earn toward up to $400 a year in free stuff at retailers like Amazon.com. Horton, an insurance brokerage, is betting the new program, which uses pedometers to tally steps, will help its 350 workers get fit – and eventually pay for itself by taming health insurance premiums.

Frustrated by traditional “wellness” programs that suffer from low participation, more employers are dangling incentives – gift cards, discounts on health premiums or even cash – to persuade workers to shed pounds. They’re giving preventative health care a second chance, viewing incentive programs as a last resort after years of shifting runaway health care costs to workers.

“Employers have begun to realize that discounted Weight Watchers programs or health club memberships have been dismal failures,” says Larry Boress, CEO of the Midwest Business Group on Health, a coalition focusing on health care issues. “They’re finding that you need real incentives to get people engaged.”

Horton Group‘s walking rewards program requires employees to tally daily steps using a pedometer and track progress at an office kiosk.

In a national survey of almost 150 CEOs conducted last year by PricewaterhouseCoopers, more than 80% said offering financial incentives for workers to live healthier is the most promising option for keeping a lid on health care costs. But far fewer actually offer them, partly because the return on investment is fuzzy.

Executives must swallow hard before spending cash to goad already healthy workers to live healthier, says Dee Edington, who studies corporate wellness programs as director of the Health Management Research Center at the University of Michigan.

“We can’t show them definitive data yet,” he says. “But employers want to believe this will work because they’re so frustrated with rising costs.”

Employers’ health insurance costs in the Midwest have grown an average 11% annually since 2000, according to the Menlo Park, Calif.-based Kaiser Family Foundation.

BOOSTING INCENTIVES

Some companies are plowing ahead anyway, guided by the belief that enticing workers to shape up will boost productivity and keep rates in check. According to a national survey of almost 3,000 employers conducted by New York-based Mercer Health & Benefits, 19% offered such incentives last year, up from 13% in 2005.

Chicago-based Grant Thornton LLP last year began offering $600 off annual premiums for employees who filled out an online health questionnaire and then signed a pledge to exercise more and eat healthier.

“Absent that money, it probably would have ended up buried in my e-mail,” says Cincinnati-based manager Chip Von Lehman. Instead, he filled out the questionnaire and learned he was “grossly overweight” at 6 feet tall and 242 pounds.

Mr. Von Lehman, 35, says he took the pledge seriously and, also motivated by a weight-loss bet with a friend, dropped 39 pounds over four months last year by counting calories and working out on a treadmill in his basement.

At Navistar International Corp.’s truck and engine division in Warrenville, less than 40% of workers took advantage of a free health screening in past years, unimpressed by the promise of a free sweatshirt or gym bag. So the company upped the ante two years ago: Workers now get $200 off their annual premiums if they get screened and then take steps to improve their health, such as signing up with a health coach. About 90% of the 5,000 eligible employees jumped at the chance.

Kenneth Olson believes the cost of Horton Group’s rewards program will be offset by reduced medical claims.

Horton Group wants similar results from its new walking rewards program, which is offered by its health insurer, Humana Inc. The program from Boston-based Virgin Life Care Inc., a new division of billionaire Richard Branson’s Virgin conglomerate, supplies the pedometers, tracks points and coordinates rewards.

Employees earn points by walking at least 7,000 steps on a given day, roughly double the average. They can measure their weight, blood pressure and body mass index at an office kiosk and upload results to a Web site, where they track their progress on a private account.

Kenneth Olson, president of Horton’s benefits division, believes the program’s cost – roughly $6 per employee per month, or $25,000 a year – will be offset by a reduction in medical claims related to inactive lifestyles, including those for heart disease and high blood pressure. And he expects savings will be at least triple the annual cost after a few years.

“Without some proactive involvement, we’re at the mercy of the marketplace in terms of what our renewal rates are going to be,” Mr. Olson says.

For more information about work site wellness programs, feel free to contact the Horton Group’s Paul Shaheen at 312-917-8623 or by email.