Discount Or Surcharge? Diment v. Quad/Graphics Tests ADA Limits On Employer Wellness Program Incentives

Employers that have wellness programs should keep an eye on an active class action in the Northern District of Illinois: Diment v. Quad/Graphics, Inc. et al.¹

The Diment  complaint alleges that Quad's wellness program violates the Americans With Disabilities Act (ADA) because employees who refused a biometric screening — a medical exam involving blood draws and cholesterol testing — were charged more for health coverage, which Diment characterizes as a non‑voluntary “penalty.”² After Diment declined the screening, her weekly premium allegedly increased by $34.81, totaling more than $1,800 per year, which she frames as an economic consequence for declining a medical examination.³ The suit is a putative class action on behalf of employees who were required to participate or face higher premiums.⁴ 

For clarity: Diment describes a surcharge for opting out, while the employer's materials frame the pricing as a discount for those who complete the screening and meet tobacco‑free status or other target ranges to “qualify for lower medical plan premiums.”⁵ Legally, that label does not control the ADA voluntariness analysis. The ADA generally prohibits employers from “requir[ing] a medical examination” or “mak[ing] inquiries” about disability unless job‑related and consistent with business necessity, with a narrow exception for a “voluntary” health program; a non‑voluntary inquiry or exam is itself discrimination.⁶ The U.S. Equal Employment Opportunity Commission's (EEOC) 2000 enforcement guidance states a wellness program is voluntary only if the employer neither requires participation nor penalizes nonparticipants, and it cautions that even if framed as an “incentive,” financial consequences can render participation non‑voluntary if large enough to be coercive.⁷ The EEOC's 2016 rulemaking that once allowed incentives up to 30% of coverage cost was vacated in AARP v. EEOC and later withdrawn; the court flagged that an average 30% differential — about $1,800 per year — can be economically coercive, leaving no operative percentage safe harbor today.⁸

Applying those principles, Diment alleges the program required a biometric exam to maintain eligibility and used health metrics (e.g., blood pressure, A1C, LDL, BMI, triglycerides/HDL) and tobacco results to set premium tiers, such that declining the exam or missing the employer‑set ranges resulted in higher premiums.⁹ She further contends the “waiver” process still demanded biometric results, offering no genuine non‑medical alternative, which she says defeats voluntariness under the ADA's § 12112(d) framework.¹⁰ The complaint seeks classwide relief, including a declaration of an ADA violation and an injunction barring weekly financial consequences tied to refusal to undergo the medical examinations, plus compensatory and punitive damages and fees.¹¹

Quad/Graphics' wellness program shares features common to many employer programs aimed at promoting wellness. This case is ongoing, but depending on the outcome, employers should reassess whether their programs satisfy the EEOC's voluntary standard under the ADA  — i.e., that employees can decline all medical exams and disability‑related inquiries without financial penalties — or whether the value of any incentive or differential, whether framed as a discount or surcharge, could be viewed as economically coercive in light of the vacated 2016 incentive provisions and the absence of a current safe harbor. 

Footnotes

1. Diment v. Quad/Graphics, Inc., No. 1:23-cv-01173 (N.D. Ill. Feb. 24, 2023).

2. Id.

3. Id.

4. Id. 

5. Id., Exhibit A. 

6. 42 U.S.C. § 12112(d)(1), (4)(B).

7. EEOC Enforcement Guidance: Disability-Related Inquiries and Medical Examinations of Employees under the Americans With Disabilities Act (ADA), General Principles, Question 22 (July 27, 2000) https://www.eeoc.gov/laws/guidance/enforcement-guidance-disability-related-inquiries-and-medical-examinations-employees#10. 

8. AARP v. EEOC, 292 F. Supp. 3d 238, 240 (D.D.C. 2017). 

9. Diment, No. 1:23-cv-01173 (N.D. Ill.).

10. Id. 

11. Id.

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