Seff v. Broward County, Case No. 10–61437–CIV.

778 F.Supp.2d 1370

24 A.D. Cases 1102

43 NDLR P 34

Bradley SEFF, Plaintiff,

v.BROWARD COUNTY, Defendant.

Case No. 10–61437–CIV.

United States District Court, S.D. Florida.

April 11, 2011.

Adam S. Chotiner, Daniel R. Levine, Robin I. Frank, Shapiro Blasi Wasserman & Gora PA, Boca Raton, FL, for Plaintiff.Benjamin Salzillo, James David Rowlee, Broward County Attorney's Office, Fort Lauderdale, FL, for Defendant.

ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT; ORDER DENYING PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT

MICHAEL K. MOORE, District Judge.

THIS CAUSE came before the Court upon the Parties' Cross–Motions for Summary Judgment. Plaintiff filed a Motion for Partial Summary Judgment on Liability (ECF No. 32). Defendant subsequently filed a Motion for Summary Judgment (ECF No. 35). The Motions have been fully briefed.

UPON CONSIDERATION of the Motions, the Responses, the Replies, the pertinent portions of the record, and being otherwise fully advised in the premises, the Court enters the following Order.

I. BACKGROUND

This is a class action case brought by present and former employees of Broward County who incurred a $20.00 charge for declining to participate in a health questionnaire and biometric screening as part of a “wellness program.” The material facts of the case are largely undisputed by the parties.¹

In 2009, saddled with an aging workforce, Broward County implemented plans to address rapidly escalating healthcare costs. As a part of this initiative, the County sought ways to improve the overall health of its workforce. Edify USA, the County's healthcare consultant, recommended a “wellness program” that would encourage employees to become active in managing their own healthcare. These kinds of programs have become increasingly popular throughout the United States. They are designed to aid employees in early detection of disease, and to provide them with the tools needed to lead healthier lives.

In October 2009, Broward County adopted a wellness program as a part of its consumer-driven health plan's Open Enrollment process. The wellness program has two components: a Health Risk Assessment questionnaire and a biometric screening. The questionnaire is confidential and conducted online. The biometric screening is also confidential and requires a finger stick blood test to measure glucose and cholesterol levels. The screening may also be done through an at-home kit.

The wellness program is administered and paid for by the County's health insurer, Coventry, and participation in the wellness program is not required for health coverage. Any personal information obtained from the questionnaire and biometric screening is not disclosed to Broward County. Broward County does receive de-identified aggregate data that it may consider in creating future benefit plans. An employee who completes the program and is identified by the insurer to have one of five disease states—asthma, hypertension, diabetes, congestive heart failure, or kidney disease—is given the opportunity to participate in a disease management coaching program. Morrison Dep. 20:5–22:22 (ECF No. 37–1). After coaching, the employee is eligible to receive certain medications associated with the identified disease at no additional cost to the employee. Id.

In 2010, the County decided to use a financial incentive to increase participation in the wellness program. Beginning June 2010, any employee who did not complete the questionnaire and undergo the screening would incur a $20.00 charge on each bi-weekly paycheck. Though the County considered giving a $20.00 credit to those who participated, it found it would be too difficult to implement and apply to the payroll system. The County suspended the surcharge on January 1, 2011.

On August 8, 2010, named Plaintiff Bradley Seff (“Seff”), a former County employee who incurred the $20.00 charge, filed a class action complaint against the County. He alleges that the County violated the Americans with Disabilities Act (“ADA” or “the Act”) by requiring employees to undergo a medical examination and making medical inquiries of its employees. He seeks damages, costs, and attorneys' fees.² Broward County maintains it did not violate the ADA. It claims its actions are covered by the ADA's safe harbor provision, covering entities involved in insurance plans.³ The Court finds that the program falls under the safe harbor provision of the Act and enters the following Order.

II. ANALYSIS

Defendant claims that it did not violate the ADA's medical examination and inquiry prohibition ⁴ because the County's wellness program falls under the insurance safe-harbor provision of the Act. The safe harbor provision is designed to protect the insurance industry from various parts of the Act. It states, in relevant part, that subchapters I through III of the ADA:

shall not be construed to prohibit or restrict— ...

(2) a person or organization covered by this chapter from establishing, sponsoring, observing, or administering the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with State law;

...

[This provision] shall not be used as a subterfuge to evade the purposes of subchapter[s] I and III of this chapter.

42 U.S.C. § 12201(c). This safe-harbor applies to the medical examination and inquiry prohibition contained in subchapter I of the Act. Therefore, if the wellness program is a benefit plan like the one described in the safe-harbor provision, then the County, in its role as administrator of a benefits plan, may require a covered employee to undergo a medical examination or answer medical inquiries.

There is no question as to whether the County is an organization covered by the chapter and, as such, the first question is whether the wellness program is a “term” of a bona fide benefit plan, or is such a program itself. Plaintiff argues that the wellness program is not a term of the County health insurance plan, nor is it independently a benefit plan. Specifically, Plaintiff states that the wellness program is not a term of the County's group health plan because “whether an employee participated in the voluntary wellness program did not dictate whether they were eligible to receive insurance benefits under one of the different insurance plans.” However, as Plaintiff argues for the greater part of his memoranda, the wellness program is not entirely optional: plan enrollees face a $20.00 surcharge for non-participation. Furthermore, an optional term does not remove that term from the scope of an overall benefits plan. For instance, many insurance policies offer a variety of optional benefits—this does not make them independent terms.

This Court views the wellness program as a term of the County's group health plan.⁵ First, Coventry, the insurer, pays for and administers the program under its healthcare contract with the County. Second, only those enrolled in the County's health plan may participate in the wellness program. Moreover, in an employee handout titled “Benefits Alert: Your Benefits & You,” Broward County Employee Benefit Services informed plan enrollees that “[f]or 2010, employees enrolled in one of the CDH plan [sic] will have to participate in both the Biometric Screening and online Health Risk Assessment.” “Benefits Alert: Your Benefits & You,” Benefits Handout (ECF 39–1). The inclusion of the wellness program on the County's benefits plan handout indicates it is a term of the County's overall group health plan.

Next, the Court must determine whether the program is “based on underwriting risks, classifying risks, or administering such risks.” In the context of the ADA safe harbor provision, at least one court has defined underwriting as “generally refer[ring] to the application of the various risk factors or risk classes to a particular individual or group for the purposes of determining whether to provide coverage.” Zamora–Quezada v. HealthTexas Medical Group of San Antonio, 34 F.Supp.2d 433, 443 (W.D.Tex.1998). The same court defined risk classification as “refer[ring] to the identification of risk factors and the groupings of those factors which pose similar risks.” Id. There is limited case law that otherwise expounds on the meaning of this language. Ordinarily, these terms collectively refer to the process of collecting information about the health of the insured in order to assess risks so the insurer may accurately establish premiums—in other words: the process of developing insurance plans. The safe harbor provision aims to protect this process. Indeed, “[t]he purpose of the safe harbor provision is to permit the development and administration of...