Long-Awaited Federal Law Bans "Genetic Information" Discrimination

Posted: May 22, 2008

Passed almost unanimously, the new Genetic Information Nondiscrimination Act of 2008 (“GINA”) prohibits discrimination on the basis of genetic information in employment and health insurance. GINA’s employment law provisions become effective November 21, 2009. For health plans and health insurance issuers, GINA generally is effective for plan years that begin on and after May 21, 2009, one year from the date President George Bush signed the measure into law. GINA also makes certain changes to the Fair Labor Standards Act concerning child labor that take effect immediately.

For years, Congress has attempted to craft legislation to address potential abuses relating to the use and disclosure of “genetic information.” Concern over this issue has increased with recent advancements in genetics, especially as genetic information has become more readily available. Congress also recognized that the existing patchwork of state and federal laws established to protect the public from genetic discrimination is confusing and inadequate. To address this concern, Congress sought to establish a national and uniform standard to protect the public from discrimination and allay concerns about the potential for discrimination, enabling individuals to more freely take advantage of genetic testing, technologies, research, and new therapies. GINA is the culmination of these efforts.

GINA prohibits workplace discrimination on the basis of genetic information through the establishment of new law and amendment of existing statutes, including Title VII of the Civil Rights Act. GINA also adds provisions applying to health insurance issuers and health plans concerning genetic information. Among other things, these provisions amend a number of existing federal laws, including the nondiscrimination and privacy provisions of the Health Insurance Portability and Accountability Act (“HIPAA”), the Employee Retirement Income Security Act (“ERISA”), the Internal Revenue Code, and others. Some of GINA’s key provisions are summarized below.

Genetic Information

Genetic information is broadly defined to include information about: (1) an individual's genetic tests, (2) the genetic tests of the individual's family members, and (3) the manifestation of a disease or disorder in a family member. A “family member” is defined to include an individual’s spouse or dependent child by birth or adoption, and certain other relatives of such individual, individual’s spouse or dependent child.

While the term “genetic information” does not include information about the sex or age of any individual, genetic information concerning an individual or family member of an individual shall include: (i) for a pregnant woman – the genetic information of any fetus carried by such pregnant woman; and (ii) for an individual or family member utilizing an assisted reproductive technology – the genetic information of any embryo legally held by the individual or family member.

GINA Prohibits Employment Discrimination Based on “Genetic Information”

Under its broad definition of “genetic information,” GINA bars discrimination in employment based not only on an individual’s own genetic information, but on a family member’s genetic information or the potential that a latent family genetic disorder may manifest.

An individual’s rights and remedies under GINA track those available under Title VII. GINA makes it an unfair employment practice for employers, employment agencies and others to discriminate against individuals based on “genetic information” in hiring, firing and other terms and conditions of employment. In addition, GINA makes it unlawful to “limit, segregate, or classify [employees, individuals, or members]… in any way that would deprive or tend to deprive [them] of employment opportunities or otherwise adversely affect the status of the [employee, individual, or member] as an employee because of genetic information….” Remedies, including compensatory and punitive damages and attorneys’ fees, are available to discriminatees.

GINA would protect an employee from discrimination based on a family history of adult-onset diabetes. However, the Americans with Disabilities Act (“ADA”) also may offer protection to individuals where a disease or disorder already is present. Likewise, the ADA would offer the employee protection if he or she actually develops diabetes while employed.

GINA also prohibits employers and others from requesting, requiring or purchasing genetic information. Certain limited exceptions, however, are included in the law: (1) inadvertently requesting or requiring family medical history; (2) requesting or requiring family medical history for purposes of complying with certification requirements of the Family and Medical Leave Act or state family and medical leave laws; and (3) genetic monitoring of the biological effects of toxic substances in the workplace, when required to do so by law and under specific conditions.

Another exception pertains to employers offering health or genetic services, such as through wellness programs. Here, too, there are restrictions. Among other things, an employee must authorize any request for genetic information in writing, and the results only can be released to the employee and a licensed health care professional or board-certified genetic counselor, although employers can receive aggregate data that does not disclose employees' identities. Many employers recently have adopted, or are planning to adopt, wellness programs aimed at identifying and/or mitigating health risks faced by their employees. A common tool in these programs is a health risk assessment (HRA). Typically, this is a list of health-related questions, sometimes pertaining to the manifestation of disease in family members. As the effective date of GINA approaches, employers will need to reassess the content of their HRAs, as well as other components of their wellness programs.

Like the ADA, GINA requires employers to keep records containing genetic information on separate forms and in separate medical files and to treat them as confidential medical records. They only can be released in clearly defined circumstances. Compliance with the ADA’s medical confidentiality rules also satisfies GINA’s confidentiality rules.

While GINA establishes a cause of action for retaliation, for the time being the law does not provide for a cause of action based on disparate impact. The new law, however, mandates establishment of a commission six years post-enactment (in 2015) to investigate whether there should be a disparate impact cause of action for discrimination based on genetic information.

GINA’s Insurance Provisions

In general, GINA prohibits discrimination based on genetic information by group, state-regulated and individual health insurance plans. This means, for example, that employer-sponsored group health plans may not adjust premium or contribution amounts on the basis of genetic information. Because the manifestation of a disease or disorder in an individual is not part of the definition of genetic information (see definition above), such information may continue to be used to alter plan premiums, provided that the plan complies with existing limitations under HIPAA and other laws. However, under GINA, information concerning the manifestation of a disease or disorder in an individual’s family member cannot be used for this purpose.

While HIPAA already prohibits genetic discrimination with regard to eligibility in group health insurance coverage, the statute does not ban insurers from requesting or obtaining genetic test results. GINA amends ERISA to prohibit group health plans from requesting or requiring that individuals or their family members take a genetic test, except where: (i) the request for genetic test results is for the purpose of making payment determinations and the request seeks the minimum amount of information necessary, and (ii) the request is for research purposes under certain enumerated conditions.

GINA also prohibits group health plans from requesting, requiring or purchasing genetic information for underwriting or enrollment purposes. Specifically, in connection with enrollment in a group health plan, GINA prohibits the plan from requesting, requiring or purchasing genetic information with respect to any individual prior to such individual's enrollment. Thus, employers and other sponsors of group health plans will need to revisit their group health plan enrollment policies, procedures and forms to ensure they are compliant with GINA. If a group health plan obtains genetic information incidental to the requesting, requiring, or purchasing of other information, however, it will not constitute a violation of GINA.

GINA also directs the Department of Health and Human Services to revise the privacy regulations under HIPAA to provide that genetic information is to be treated as protected health information (as defined in the privacy regulations).

To enforce these provisions with respect to group health plans, GINA amends section 502 of ERISA to provide the Secretary of Labor with the authority to seek monetary penalties against plan sponsors and health insurance issuers. GINA also amends section 4980D of the Internal Revenue Code to assess an excise tax for compliance failures.

Under ERISA, as amended, the amount of the penalty that can be assessed is $100 for each day the plan fails to be in compliance with respect to each participant or beneficiary to whom such failure relates. This penalty will not be imposed if either (i) the Secretary is satisfied that the plan sponsor, for example, did not know, and exercising reasonable diligence would not have known, that such failure existed, or (ii) the failure was due to reasonable cause and not to willful neglect and is corrected within 30 days following the date the plan sponsor knew or should have known that such failure existed. These exemptions will not apply, however, if the failure is not corrected before the plan receives a notice from the Secretary concerning the violation. There also is an overall cap on penalties for unintentional failures: the lesser of 10 percent of the aggregate amount paid or incurred by the plan sponsor during the preceding taxable year for group health plans, or $500,000.

GINA Raises Penalties for Child Labor Violations

Among its miscellaneous provisions, GINA also amends the Fair Labor Standards Act of 1938 (“FLSA”) to increase the penalty for child labor violations by $1,000 per violation. The new law raises potential employer liability to $50,000 where a violation causes the death or serious injury of a minor. This amount can be doubled for repeat or willful violations. These amendments to the FLSA are effective as of May 21, 2008.

Do GINA’s Employment Provisions Alter the Current Legal Landscape?

Although 35 states have laws prohibiting workplace genetic discrimination, many of them do not offer the same protections as GINA. Florida, for example, only prohibits discrimination against individuals who have the trait for sickle-cell anemia. Other states ban discrimination based on genetic test results, but do not explicitly prohibit discrimination based on family medical history. And some states, such as Arizona, do not preclude employers from requiring or requesting employees to undergo genetic testing. In other states, like New York, Massachusetts and Oregon, the law is more robust, prohibiting employers from requiring or requesting genetic test results as well as from discriminating in terms and conditions of employment on the basis of genetic information. Even the more expansive state laws, however, sometimes fall short of GINA’s protections.

Moreover, prior to GINA there was no comprehensive federal law regulating genetic discrimination. While the ADA prevents employers from discriminating against individuals with a physical or mental impairment that substantially limits one or more of the major life activities, a record of such an impairment, or from being regarded as having such an impairment, and the Equal Employment Opportunity Commission (“EEOC”) maintains that the ADA covers genetic information, no court has interpreted the ADA to cover a genetic predisposition to disease. In addition, although President Bill Clinton signed an Executive Order in 2000 prohibiting genetic discrimination by federal employers, the law does not cover all types of genetic testing, nor does it cover family medical history. GINA establishes a base of legal protections. Therefore, employers and health plans must still comply with any protections established under state law that are more protective of individuals, including employees, than the legal requirements of GINA.

The good news is that employers, plan sponsors and others will have some time to analyze the effects of the new law given the delayed effective dates noted above. Additional guidance also is expected from the EEOC and the Departments of Labor, Health and Human Services and Treasury, as the law directs these agencies to issue regulations over the next twelve to eighteen months.

Jackson Lewis attorneys will be examining additional guidance concerning GINA soon expected from federal agencies and are available to provide information regarding the new law to help ensure your company is in compliance when GINA’s employment and insurance provisions.