Premium Incentives for Vaccination Status

Summary

Recently released FAQs confirm the view of the Departments of Labor, Treasury, and Health and Human Services (the "Departments") that employers can provide incentives under a group health plan (either in the form of premium discounts or surcharges) to encourage employees to receive COVID-19 vaccines. Such premium discounts or surcharges are permissible if offered through a wellness program as described under the Affordable Care Act ("ACA") final wellness program regulations. The FAQs confirm that vaccination status is considered an activity-based health contingent wellness program. As such, any vaccine incentives offered under a health plan must meet the following five-factor test that applies to all health contingent wellness programs: