Chapter VII: Nondiscrimination In Other Employment Practices
7.9 Health Insurance and Other Employee Benefit Plans
As discussed above, an employer or other covered entity may not limit,
segregate or classify an individual with a disability, on the basis of
disability, in a manner that adversely affects the individual's employment.
This prohibition applies to the provision and administration of health
insurance and other benefit plans, such as life insurance and pension plans.
This means that:
- If an employer provides insurance or other benefit plans
to its employees, it must provide the same coverage to its employees
with disabilities. Employees with disabilities must be given equal access
to whatever insurance or benefit plans the employer provides.
An employer cannot deny insurance to an individual with a disability
or subject an individual with a disability to different terms or conditions
of insurance, based on disability alone, if the disability does not
pose increased insurance risks. Nor may the employer enter into any
contract or agreement with an insurance company or other entity that
has such effect. - An employer cannot fire or refuse to hire an
individual with a disability because the employer's current health insurance
plan does not cover the individual's disability, or because the individual
may increase the employer's future health care costs.
- An employer cannot fire or refuse to hire an individual (whether
or not that individual has a disability) because the individual has
a family member or dependent with a disability that is not covered by
the employer's current health insurance plan, or that may increase the
employer's future health care costs.
While establishing these protections for employees with disabilities,
the ADA permits employers to provide insurance plans that comply with existing
Federal and state insurance requirements, even if provisions of these plans
have an adverse affect on people with disabilities, provided that the provisions
are not used as a subterfuge to evade the purpose of the ADA.
Specifically, the ADA provides that:
Where an employer provides health insurance through an insurance carrier
that is regulated by state law, it may provide coverage in accordance
with accepted principles of risk assessment and/or risk classification,
as required or permitted by such law, even if this causes limitations
in coverage for individuals with disabilities. Similarly, self-insured
plans which are not subject to state law may provide coverage in a
manner that is consistent with basic accepted principles of insurance risk
classification, even if this results in limitations in coverage to individuals
with disabilities.
In each case, such activity is permitted only if it is not being used
as a subterfuge to evade the intent of the ADA. Whether or not an activity
is being used as a subterfuge will be determined regardless of the date that
the insurance plan or employee benefit plan was adopted.
This means that:
- An employer may continue to offer health insurance plans
that contain pre-existing condition exclusions, even if this adversely
affects individuals with disabilities, unless these exclusions are
being used as a subterfuge to evade the purpose of the ADA.
- An employer may continue to offer health insurance plans
that limit coverage for certain procedures, and/or limit particular
treatments to a specified number per year, even if these restrictions
adversely affect individuals with disabilities, as long as the restrictions
are uniformly applied to all insured individuals, regardless of the
disability.
- For example, an employer can offer a health insurance
plan that limits coverage of blood transfusions to five transfusions
per year for all employees, even though an employee with hemophilia
may require more than five transfusions per year. However, the employer
could not deny this employee coverage for another, otherwise covered
procedure, because the plan will not pay for the additional blood transfusions
that the procedure would require.
- An employer may continue to offer health insurance plans
that limit reimbursements for certain types of drugs or procedures,
even if these restrictions adversely affect individuals with disabilities,
as long as the restrictions are uniformly applied without regard to
disability.
- For example, an employer can offer a health insurance
plan that does not cover experimental drugs or procedures, as long
as this restriction is applied to all insured individuals.
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