December 18, 2009Client Alert

Interim Final Health Insurance Rules Under Genetic Information Nondiscrimination Act ("GINA") Published

On October 7, 2009, new interim rules for implementation of the Genetic Information Nondiscrimination Act ("GINA") were published in the Federal Register. They take effect for plans and issuers on the first day of the first plan year beginning on or after December 6, 2009 (January 1, 2010 for plans administered on a calendar year). Affected parties may submit comments on the interim rules electronically at on or before the end of the day, January 5, 2010.

The release of these new regulations is important because they will affect how plan sponsors operate their group health plans, and particularly health risk assessment components of group health plans. Yet, even employers who do not utilize health risk assessments need to understand GINA. When GINA was passed in May 2008, it prohibited discrimination on the basis of genetic information in plan coverage and in the workplace. This client alert discusses both the plan coverage and workplace discrimination provisions. The plan coverage provisions took effect May 21, 2009. The workplace discrimination provisions took effect November 21, 2009.

What is Genetic Information?

Genetic information, which is defined very broadly, includes:

  • the individual’s "genetic tests";
  • the "genetic tests" of family members;
  • the "manifestation of a disease or disorder in family members"; or
  • any request for, or receipt of, genetic services or participation in certain clinical research.

This definition affects both the plan coverage and employment discrimination provisions.

Plan Coverage Provisions

GINA generally prohibits group health plans and health insurance issuers from:

  • increasing the group premium or contribution amounts based on "genetic information";
  • requesting or requiring an individual or family member to undergo a "genetic test"; and
  • requesting, requiring or purchasing genetic information prior to or in connection with enrollment, or at any time for "underwriting purposes."

Each of these new terms and rules is explained below. As a practical matter, the new GINA rules likely require every employer to examine their health risk assessments ("HRAs") used in connection with a wellness plan. Such HRAs often ask questions about the medical history of family members—information that, as described below, could be the improper collection of "genetic information."

  1. Does Our Health Plan Conduct Genetic Tests? Probably not. "Genetic tests" involve an actual analysis of human DNA, RNA or related items. Although a health plan may pay for such a screening, the health plan would not typically conduct the test itself nor would the plan modify its premiums or benefits based on the results of the test. Thus, most health plans probably will not conduct or receive the results of genetic tests and GINA would not impact this aspect of a health plan’s activities.

  2. Does Our Health Plan Gather Information About Disease or Disorders of Family Members? Perhaps. HRAs often ask questions about the "manifestation of a disease or disorder in family members." If so, an HRA will have collected "genetic information" and will likely be subject to the new GINA rules.

GINA Rule #1: No Premiums or Contributions Based on Genetic Information.
Under GINA, a group health plan cannot adjust premiums or contributions based on genetic information. The plan can, however, adjust premiums or contributions based on claims experience—even if this experience was high due to medical conditions that were caused by genetic problems. For example, suppose an employer has a self-funded group health plan. Employee A had high claims due to treatment of polycystic kidney disease (which is caused by a gene mutation). Employee A has two dependent children covered by the plan. The employer is concerned that the two dependent children also could develop the same medical condition. The employer increases the health plan’s premium rates both because of Employee A’s high medical claims and because of the children’s potential future claims. This increase would violate GINA because of the employer's focus on the children's potential future claim. However, if the employer increased the plan’s rates only because of Employee A’s high claims, the increase would not violate GINA.

GINA Rule #2: Plan Generally Cannot Request or Require Genetic Tests (and If It Does, a "Minimum Necessary" Rule Applies).

Under GINA, a group health plan cannot request or require an individual or family member to undergo a genetic test. Again, it appears that most plans do not currently require individuals to undergo genetic tests, so this rule should have limited impact on most plans. A plan can obtain and use the results of a genetic test in making a determination regarding payment. For example, suppose a plan covers a yearly mammogram starting at age 40, or at age 30 for those with increased risk of breast cancer, including individuals with BRCA1 or BRCA2 gene mutations. Employee C is 33 years old and has the BRCA2 mutation. Employee C undergoes a mammogram and submits the claim to the plan for payment. Following an established, uniform policy, the plan requests that Employee C provide evidence of the increased risk, such as the results of a genetic test. This request by the plan does not violate GINA. If Employee C refuses to provide such evidence, the plan can refuse to pay the claim.

The GINA rules also include a "minimum necessary" rule similar to the HIPAA Privacy Rule’s "minimum necessary" rule: when a plan requests genetic information for payment purposes, it can only request the "minimum amount" of information necessary to make the payment determination. It is not clear what steps a plan should take to ensure it complies with this minimum necessary rule (e.g., whether a plan should implement a written policy and procedure to formally adopt this requirement).

GINA Rule #3: A Plan Cannot Collect Genetic Information for "Underwriting" Purposes
A group health plan cannot collect genetic information for underwriting purposes. Underwriting includes:

  • Rules for, or determination of, eligibility--including enrollment, continued eligibility, changes in deductibles or other cost-sharing mechanisms in return for activities such as completing an HRA or participating in a wellness program;
  • The computation of premium or contribution amounts—including discounts, rebates, or other premium differential mechanisms in return for activities such as completing an HRA or participating in a wellness program;
  • The application of any preexisting condition exclusion under the plan; or
  • Other activities related to the creation, renewal, or replacement of a contract of health insurance or health benefits.

Rule #3 is likely to impact many HRAs. For example, suppose a plan provides a premium reduction to an enrollee who completes an HRA after enrollment. The HRA includes questions about the individual’s family medical history. This request for family medical history will be for "underwriting" purposes because the HRA results in a premium reduction. Thus, the request violates GINA.

An HRA can be modified to avoid violating GINA

. The HRA could provide no reward or penalty for completing it (or failing to complete it). Such an HRA would not be for "underwriting" purposes. However, employers may not like this option, because HRAs tend to be less widely used if there is no reward or penalty associated with the HRA. The HRA could also be divided into two HRAs: the first HRA could not ask for any family medical history while the second (which would be voluntary) would ask for family medical history. Any premium discount would only apply to the first HRA, not the second HRA. This arrangement would not violate GINA because the family-history-related HRA would not be for "underwriting" purposes. Such an HRA structure must be conducted after enrollment and must be unrelated to enrollment (for the reasons discussed, in Rule #4).

Practical Tip: Many employers have conducted HRAs during 2009 that requested family medical history. Such employers generally intend to use the information obtained through the HRA for 2010 plan year operations (including underwriting). Recent IRS commentary suggests that this would violate GINA and the interim final regulations even though such action took place prior to the effective date of the regulations. The IRS has offered employers alternatives, including: 1) performing the 2009 HRA a second time; 2) give everyone the benefit under the HRA (regardless of whether they answered the family medical history question); or 3) give no one the HRA benefit or premium discount. Employers who find themselves in this situation should proceed with caution and seek the advice of legal counsel.

GINA Rule #4: Plan Cannot Collect Genetic Information in Connection With Enrollment (but Incidental Collection is Acceptable)

Under GINA, a group health plan cannot collect genetic information with respect to any individual prior to the individual’s effective date of coverage under the plan, nor in connection with the rules for eligibility that apply to the individual. These rules are stringent: they apply even if there is no reward for completing the HRA or penalty for failing to complete it. For example, suppose Acme Co.’s health plan requests that enrollees complete an HRA prior to enrollment. The HRA includes questions about the individual’s family medical history. There is no reward or penalty for completing, or not completing, the HRA. Acme Co.’s plan would violate GINA because the request is made prior to enrollment.

The regulations contain one exception to this stringent rule: a plan can obtain genetic information that is incidental to the collection of other information concerning the individual, as long as the collection is not for underwriting purposes. However, this exception will not apply if it was reasonable to anticipate that health information will be received, unless the collection explicitly states that genetic information should not be provided.

Practical Tip: Employers should examine what health information, if any, their group health plans gather about employees and family members prior to enrollment. Employers should state on any related forms that genetic information should not be provided. The federal agencies provide the following language in an example: "In answering this question [about providing any other information that is relevant to an individual’s health], you should not include any genetic information. That is, please do not include any family medical history or any information related to genetic testing, genetic services, genetic counseling, or genetic diseases for which you believe you may be at risk."

Employment Discrimination Provisions

On May 20, 2009, the U.S. Equal Employment Opportunity Commission ("EEOC") issued proposed regulations implementing the employment-related sections of GINA. Information about how an individual’s disease or disorder has been manifested in that individual or in any person in the individual’s family is covered, even if the information does not take the form of a genetic test or a record of genetic treatment. It can be simply information about a disease theorized to have a basis in genetics -- breast cancer, Crohn’s disease and Muscular Dystrophy, by example. (GINA’s definition of information is substantially broader than that of other already-existing state laws regulating the use of genetic testing and related information, like Section 111.372 of Wisconsin’s Statutes.) An employer’s request for or possession of any such information might trigger GINA’s prohibitions against discrimination by that employer against the individual to whom the information applies.

GINA, by its terms, does not hold employers liable for inadvertently requesting or obtaining genetic information they otherwise would be prohibited from seeking. But the science of genetic study is accelerating discovery of the genetic roots and sources of more and more conditions and diseases. Employers, therefore, must take great care in requesting medical information on job offerees and employees, even if such requests are compliant with the terms of the Americans with Disabilities Act, in order to avoid challenges under GINA. Inquiries that seek information about family medical history, for instance, must be crafted carefully and narrowly.

The members of Michael Best’s Employment Relations Practice Group stand ready to answer any questions you might have about the interim rules under GINA, the EEOC’s proposed GINA regulations or GINA’s terms. Please contact one of the authors of this alert or your Michael Best attorney.

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