Detail

ADA

The ADA, enforced by the Equal Employment Opportunity Commission (EEOC), generally prohibits discrimination against qualified individuals with a disability. Specifically, Title I of the ADA covers private, nonprofit and governmental employers with 15 or more employees and provides that "no covered entity shall discriminate against a qualified individual on the basis of disability in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment."¹ The ADA makes it unlawful to discriminate in all employment practices, including benefits.²

While one might not consider hemophilia a disability per se, "disability" under the ADA is defined as: (A) a physical or mental impairment that substantially limits one or more major life activities of such individual; (B) a record of such impairment; or (C) being regarded of having such an impairment.³ The EEOC has defined an "impairment" as a physiological disorder affecting one or more named body systems, a mental disorder or a psychological disorder.⁴

In its discrimination defense, an employer must show two things:

1. The benefit plan is bona fide; and
2. The plan is not a subterfuge to evade the purposes of the ADA.⁵

According to the EEOC Enforcement Manual, employers can do one of several things to prove that any disability-related distinction in its benefit plan offerings is not subterfuge:

1. An employer may prove that it has not engaged in the disability-based disparate treatment alleged. An example in the Enforcement Manual provides that an employer has not engaged in subterfuge where the condition predated enrollment in the plan and the exclusion was based on a preexisting condition classification.
2. The employer may provide that the disability-based disparate treatment is justified by legitimate actuarial data, or by actually or reasonably anticipated experience, and that conditions with comparable actuarial data and/or experience are treated the same way.

a. Here, actuarial data will be required to measure the likelihood that the employer will incur insurance costs related to the disability and the magnitude of those costs as they arise. Employers will need to show that any reduction in coverage for disability is required to account for an increased possibility that the benefit will be claimed or amounts required for coverage will be higher. Employers cannot rely on any actuarial data that is outdated or based on fears or stereotypes about the disability at issue.⁷

b. It is important to note that employers must produce actuarial data that proves they have treated other conditions that pose significant risks and costs in the same manner. They cannot simply produce data that shows the cost and risk to a plan for treatment of a certain condition as justification for different treatment of it.

3. Employers must prove that the disability-related disparate treatment is necessary to maintain the solvency of the plan. They can do this through:
1. Offering proof that the disability would require such substantial payments of benefits that the fiscal soundness of the plan would be at jeopardy; and
2. Showing that there is no non-disability alternative benefit plan design chan