United States District Court, District of Columbia
D. BATES, United States District Judge.
case concerns AARP's Administrative Procedure Act (APA)
challenge to two regulations promulgated by the U.S. Equal
Employment Opportunity Commission (EEOC) related to
incentives and employer-sponsored wellness programs.
See Regulations Under the Americans with
Disabilities Act (“the ADA rule”), 81 Fed. Reg.
31, 126 (May 17, 2016); Regulations Under the Genetic
Information Nondiscrimination Act (“the GINA
rule”), 81 Fed. Reg. 31, 143 (May 17, 2016). In
December 2016, this Court denied AARP's motion for a
preliminary injunction to stay applicability of the rules,
and the new regulations became applicable on January 1, 2017.
See generally AARP v. EEOC, 226 F.Supp.3d 7 (D.D.C.
2016) (AARP I). EEOC has now filed  a motion to
dismiss/motion for summary judgment, and AARP has filed 
a cross-motion for summary judgment. For the reasons that
follow, EEOC's motion to dismiss/motion for summary
judgment will be denied, and AARP's motion for summary
judgment will be granted.
case deals with the incentives-financial or otherwise-that
may be offered to employees in connection with
employer-sponsored wellness programs, which have become
popular in many work places in the last several years as a
means of promoting employee health and reducing healthcare
costs. The central issue here results from the tension that
exists between the laudable goals behind such wellness
programs, and the equally important interests promoted by the
Americans with Disabilities Act (ADA) and the Genetic
Information Nondiscrimination Act (GINA). EEOC is tasked with
reconciling these competing concerns, and this case arises
out of its most recent attempt to do so.
previous opinion, the Court discussed at length the complex
regulatory and statutory framework that governs this case;
thus, a shorter review will suffice here. See AARP
I, 226 F.Supp.3d at 11-15. Wellness programs are
regulated in part by the Health Insurance Portability and
Accountability Act (HIPAA), as amended by the Affordable Care
Act (ACA), as well as by HIPAA's implementing
regulations. HIPAA prevents health plans and insurers from
discriminating on the basis of “any health status
related factor, ” but allows covered entities to offer
“premium discounts or rebates” on a plan
participant's copayments or deductibles in return for
that individual's compliance with a wellness program.
See 29 U.S.C. § 1182(b)(2)(B); 26 U.S.C. §
9802(b); 42 U.S.C. § 300gg-4(b). A “reward”
or incentive may include a discount on insurance costs or a
penalty that increases the plan participant's costs
because of non-participation in the wellness program.
See 26 C.F.R. § 54.9802-1(f)(1)(i). The
ACA's amendments to HIPAA, and the accompanying
implementing regulations, allow plans and insurers to offer
incentives of up to 30% of the cost of coverage in exchange
for an employee's participation in a health-contingent
wellness program, a kind of wellness program in which the
reward is based on an insured individual's satisfaction
of a particular health-related factor. See
Incentives for Nondiscriminatory Wellness Programs in Group
Health Plans (“the 2013 HIPAA regulations” or
“2013 HIPAA rule”), 78 Fed. Reg. 33, 158, 33,
180. Neither the ACA nor the 2013 HIPAA regulations impose a
cap on incentives that may be offered in connection with
participatory wellness programs, which are programs that do
not condition receipt of the incentive on satisfaction of a
health factor. Id. at 33, 167.
because employer-sponsored wellness programs often involve
the collection of sensitive medical information from
employees, including information about disabilities or
genetic information, these programs often implicate the ADA
and GINA as well. As both the ADA and GINA are administered
by EEOC, this brings wellness programs within EEOC's
purview. The ADA prohibits employers from requiring medical
examinations or inquiring whether an individual has a
disability unless the inquiry is both job-related and
“consistent with business necessity.” 42 U.S.C.
§ 12112(d)(4)(A). But the ADA makes some allowances for
wellness programs: it provides that an employer may conduct
medical examinations and collect employee medical history as
part of an “employee health program, ” as long as
the employee's participation in the program is
“voluntary”. Id. § 12112(d)(4)(B).
The term “voluntary” is not defined in the
statute. Similarly, GINA prohibits employers from requesting,
requiring, or purchasing “genetic information”
from employees or their family members. Id. §
2000ff-1(b). The definition of genetic information includes
an individual's genetic tests, the genetic tests of
family members such as children and spouses, and the
manifestation of a disease or disorder of a family member.
See id. § 2000ff(4)(A). Like the ADA, GINA
contains an exception that permits employers to collect this
information as part of a wellness program, as long as the
employee's provision of the information is voluntary.
Id. §§ 2000ff-1(b)(2)(A)-(B). Again, the
meaning of “voluntary” is not defined in the
while HIPAA and its implementing regulations expressly permit
the use of incentives in wellness programs, uncertainty
existed as to whether the “voluntary” provisions
of the ADA and GINA permit the use of incentives in those
wellness programs that implicate ADA- or GINA-protected
information. EEOC previously took the position that in order
for a wellness program to be “voluntary, ”
employers could not condition the receipt of incentives on
the employee's disclosure of ADA- or GINA-protected
information. See EEOC Enforcement Guidance on
Disability-Related Inquiries and Medical Examinations, No.
915.002 (July 27, 2000), 2000 WL 33407181, at *16-17;
Regulations Under the Genetic Information Nondiscrimination
Act of 2008 (“the 2010 GINA rule”), 75 Fed. Reg.
68, 912, 68, 935 (Nov. 9, 2010), codified at 29 C.F.R. §
1635. However, in 2016 EEOC promulgated new rules reversing
this position. Those are the rules at issue in this case. The
new ADA rule provides that the use of a penalty or incentive
of up to 30% of the cost of self-only coverage will not
render “involuntary” a wellness program that
seeks the disclosure of ADA-protected information.
See ADA Rule, 81 Fed. Reg. at 31, 133-34. Likewise,
the new GINA rule permits employers to offer incentives of up
to 30% of the cost of self-only coverage for disclosure of
information, pursuant to a wellness program, about a
spouse's manifestation of disease or disorder, which, as
noted above, falls within the definition of the
employee's “genetic information”
under GINA. See GINA Rule, 81 Fed. Reg. at
31, 144. Unlike the 2013 HIPAA regulations, which place caps
on incentives only in health-contingent wellness programs,
the incentive limits in the new GINA and ADA rules apply both
to participatory and health-contingent wellness programs.
filed this suit on behalf of its members in October 2016,
challenging both rules under the APA, 5 U.S.C. §§
702-06. AARP argues principally that the 30% incentives
permitted by the new rules are inconsistent with the
“voluntary” requirements of the ADA and GINA, and
that employees who cannot afford to pay a 30% increase in
premiums will be forced to disclose their protected
information when they otherwise would choose not to do so.
AARP sought a preliminary injunction, which the Court denied,
finding that AARP had associational standing, but that it had
not at that stage shown either irreparable harm or a
likelihood of success on the merits. See AARP I, 226
F.Supp.3d at 15, 20-26. Because of the short timeline on
which the motion for a preliminary injunction was briefed and
decided, the administrative record was not then available for
the Court's review. The administrative record has now
been produced, EEOC has now moved to dismiss for lack of
jurisdiction, and both parties have also moved for summary
asks the Court to revisit its ruling regarding AARP's
standing, again challenging AARP's status as a membership
organization, and arguing that Declarant A, the
member-declarant on whom the Court relied in finding that
AARP had standing at the preliminary injunction stage, lacks
standing based on new factual information that was not
previously available. See Gov't Mot. for Summ.
J. [ECF No. 31] at 10-15. EEOC also argues that the new rules
survive the deferential standard of review afforded agency
decisions in APA cases, and therefore asks for summary
judgment in its favor. See, e.g., id. at
15. AARP counters that the incentives allowed by the new
rules are inconsistent with the meaning of
“voluntary” as used in the statutes, and that
EEOC failed to adequately explain its departure from its
previous position on incentives. See Pl.'s Mot.
for Summ. J. [ECF No. 35-1] at 1, 24, 39. The Court will
address each issue in turn.
has filed a motion to dismiss for lack of jurisdiction under
Federal Rule of Civil Procedure 12(b)(1), arguing that AARP
has not sufficiently established that it has associational
standing to bring suit on behalf of its members in this case.
A plaintiff “bears the burden of showing that he has
standing for each type of relief sought.” Summers
v. Earth Island Inst., 555 U.S. 488, 493 (2009). A lack
of standing constitutes “a defect in [the Court's]
subject matter jurisdiction.” Haase v.
Sessions, 835 F.2d 902, 906 (D.C. Cir. 1987). In
evaluating a motion to dismiss under Rule 12(b)(1), a court
must take as true all factual allegations in the complaint.
See, e.g., Jerome Stevens Pharm., Inc. v. Food
& Drug Admin., 402 F.3d 1249, 1253-54 (D.C. Cir.
2005). However, in considering jurisdiction, the court
“may also consider matters outside the pleadings, and
may rest its decision on its own resolution of disputed
facts.” Advance Am. v. Fed. Deposit Ins.
Corp., ___ F.Supp.3d ___, 2017 WL 2869918, at *2 (D.D.C.
July 5, 2017) (citing Herbert v. Nat'l Acad. of
Sci., 974 F.2d 192, 197 (D.C. Cir. 1992)).
order to successfully assert associational standing, AARP
must show that: (1) at least one of its members would have
standing to sue in his or her own right; (2) the interests it
seeks to protect are germane to its purpose; and (3) neither
the claim asserted nor the relief requested requires the
participation of an individual member of the organization in
the suit. Hunt v. Wash. State Apple Advert.
Comm'n, 432 U.S. 333, 342-43 (1977). As noted above,
the Court found in its previous opinion that AARP has
standing to bring this suit. See AARP I, 226
F.Supp.3d at 16-20. However, EEOC asks the Court to revisit
its finding that AARP is a “membership
organization” that may assert associational standing,
and also raises arguments based on new information about
Declarant A that it claims undermines Declarant A's
standing. See Gov't Mot. for Summ. J. at 10-15.
The Court will accordingly revisit these issues.
contends that AARP does not have “members” on
whose behalf it can assert associational standing. The Court
analyzed this issue at length in its previous opinion, and
observed that the associational standing caselaw is unclear
as to what, exactly, constitutes a “membership”
organization. AARP I, 226 F.Supp.3d at 16. In
Hunt, the Supreme Court identified several criteria
that should be used to determine whether a
non-membership organization sufficiently represents
its constituents' interests to be able to bring suit on
their behalf. These “indicia of membership” are:
whether the members play a role in selecting the
organization's leadership, guiding the organization's
activities, and financing the organization's activities.
Hunt, 432 U.S. at 344-45. Some courts have held that
these criteria do not apply to “traditional”
membership organizations, but no court has precisely defined
what that means. See, e.g., Brady Campaign to
Prevent Gun Violence v. Salazar, 612 F.Supp.2d 1, 29
(D.D.C. 2009) (“The inquiry into indicia of membership
. . . is necessary only when an organization is not a
“traditional membership organization.” (internal
quotation marks omitted)). The Court therefore assumed in its
previous opinion that the Hunt indicia of membership
criteria applied here and found that AARP satisfies these
indicia of membership. EEOC challenges this finding, but
presents no new facts or law that would call the Court's
previous decision into question. See Gov't Mot.
for Summ. J. at 10-13.
argues first that AARP is not a membership organization
because it has no “members” within the meaning of
D.C. law governing non-profit corporations. See id.
at 10 (citing D.C. Code § 29-401.02(24)). But EEOC cites
no authority suggesting that state corporations law is
dispositive or even relevant to the associational standing
inquiry. See, e.g., Citizens Coal Council v.
Matt Canestrale Contracting, Inc., 40 F.Supp.3d 632, 640
(W.D. Pa. 2014) (noting that lack of voting rights was not
sufficient to defeat associational standing); Concerned
Citizens Around Murphy v. Murphy Oil USA, Inc.,
686 F.Supp.2d 663, 675 (E.D. La. 2010) (noting that
“[c]orporate formalities and formal membership
structure are not constitutional requirements for
associational standing”). The Court will not disturb
its prior ruling on this basis.
next argues that AARP has not shown that it is a membership
organization because it has not shown that Declarant A serves
on AARP's Board of Directors, serves on a policy
committee, or has ever completed an AARP survey, factors that
the Court previously identified in finding that AARP
satisfied the indicia of membership criteria. See AARP
I, 226 F.Supp.3d at 17; see also Gov't Mot.
for Summ. J. at 11-12. Unless Declarant A can show that he
participates in these activities, the argument goes, he is
not a member and AARP has failed to show that it has
associational standing. See U.S. Chamber of Commerce v.
EPA, 642 F.3d 192, 199 (D.C. Cir. 2011) (“When a
petitioner claims associational standing, it is not enough to
aver that unidentified members have been injured. Rather, the
petitioner must specifically identify members who
have suffered the requisite harm.” (emphasis added)
(internal citation and quotation marks omitted)). But
EEOC's argument appears to go more towards how
active a member Declarant A is in AARP, not whether
he is a member. Declarant A has as much right to
participate in the activities that the Court identified as
any other member of AARP, and courts do not appear to analyze
to what extent an identified member partakes in membership
activities in determining whether an organization has
the Court acknowledges, as it did in its previous opinion,
that whether AARP satisfies the indicia of membership
criteria is a close question here. See AARP I, 226
F.Supp.3d at 17-18. AARP's members play less of a role in
the running of the organization than do members of
organizations who, for example, directly elect their
leadership and hold regular general membership meetings.
See, e.g., ACLU of Nebraska,
board-director-elections (noting that “[a]ll ACLU
members in Nebraska have been mailed a ballot for our Board
of Directors Election”); Constitution of the NAACP, at
But AARP members are not akin to Netflix subscribers, i.e.,
mere “customers, ” as EEOC suggests, nor does
AARP fit the mold of those organizations whom courts have
consistently found may not assert associational standing.
See, e.g., Gettman v. Drug Enf't
Admin., 290 F.3d 430, 435 (D.C. Cir. 2002) (readers of
magazine were not members for associational standing
purposes); Fund Democracy LLC v. SEC, 278 F.3d 21,
25-26 (D.C. Cir. 2002) (past work with groups of individual
investors did not render the investors “members”
of Fund Democracy); Am. Legal Found. v. FCC, 808
F.2d 84, 89-90 (D.C. Cir. 1987) (viewers who regularly watch
the news were not members of media watchdog group for
associational standing purposes); Conservative Baptist
Ass'n of Am. v. Shinseki, 42 F.Supp.3d 125, 134
(D.D.C. 2014) (individual members of congregation were not
members of an association made up exclusively of churches);
Wash. Legal Found. v. Leavitt, 477 F.Supp.2d 202,
210-11 (D.D.C. 2007) (members of a mailing list, without
more, did not constitute members for purposes of
associational standing). AARP lies somewhere in between these
the Court previously recognized, the associational standing
cases are not specific about what it means for members to
“play a role in” the leadership of an
organization, the financing of an organization, or in guiding
the activities of an organization. AARP members play a role
in all of these activities, even if they could play a
stronger role, and EEOC has once again failed to point to any
cases that would suggest that what AARP members do is
insufficient to establish associational standing. Without
more, the Court is wary of a ruling that would bar not only
AARP from asserting associational standing, but also bar
other repeat litigators whom courts have routinely held are
able to assert associational standing as “traditional
membership organizations.” See, e.g.,
Friends of the Earth, Inc. v. Laidlaw Envt'l Servs.
(TOC), Inc., 528 U.S. 167, 181-84 (2000); Am.
Trucking Ass'n v. Fed. Motor Carrier Safety Admin.,
724 F.3d 243, 247 (D.C. Cir. 2013); WildEarth Guardians
v. Jewell, 738 F.3d 298, 305-07 (D.C. Cir. 2013).
Accordingly, the Court will not disturb its prior ruling
regarding AARP's status as a membership organization.
Individual member's standing to sue
order to assert associational standing, AARP must show that
one of the members it purports to represent would have
individual standing to challenge the ADA rule and the GINA
rule. See Nat'l Biodiesel Bd. v. EPA, 843 F.3d
1010, 1015 (D.C. Cir. 2016). The Court previously found that
Declarant A would have standing with respect to both rules.
AARP I, 226 F.Supp.3d at 18-19. EEOC now argues that
Declarant A would not have standing to sue, based on new
information about the collective bargaining agreement between
Declarant A's union and his employer. EEOC has learned
that the agreement in force for 2015-17 provided that the
employer would pay an additional one percent of health
insurance premiums for individuals who disclose confidential
health information through completing a health risk
assessment, and an additional one percent for those
individuals who participate in biometric screenings.
See Gov't Mot. for Summ. J. at 13-14. That
agreement also included a disease management program for one
disease, in which all plan participants were eligible to
participate, but Declarant A's spouse does not have the
condition covered under the original agreement. However, the
agreement stated that additional disease management programs
were under consideration.
the current round of briefing ended, EEOC learned that this
collective bargaining agreement was renewed through 2020.
See Notice of Factual Development [ECF No. 41-1] at
2; Hrg. Tr. [ECF No. 45] at 37:10-13. The renewed agreement
took effect on July 1, 2017 and maintains the incentive
levels for completing the HRA and participating in biometric
screening, but now adds incentives for plan participants,
including spouses, to participate in additional disease
management programs for certain diseases. Those who
participate will have their co-payments waived on certain
medications. Declarant A's spouse informed AARP counsel
that she has one of the conditions covered by the new
incentive program. See Pl.'s Resp. to Notice of
Factual Development [ECF No. 42] at 1-2; see also
Hrg. Tr. at 11:19-13:8, 29:25-30:4.
respect to the ADA rule, EEOC argues that because Declarant
A's collective bargaining agreement only imposes
incentives of 2%, Declarant A may not challenge the
“full extent” of the ADA rule, which allows
incentives of up to 30%. EEOC additionally points out that
AARP has conceded that some level of incentives would be
permissible, i.e., consistent with the ADA's
voluntariness requirement. See Gov't Reply [ECF
No. 38] at 11. Therefore, Declarant A would at most only be
able to challenge a 2% incentive limit.
government's approach-parsing standing to challenge the
rule by the particular incentive level-makes little sense.
Under EEOC's approach, only someone whose employer has
adopted an incentive level of 30% would have standing to
challenge the rule. See Gov't Reply at 11. Yet
the provision of the ADA rule that AARP-with the help of
Declarant A-challenges permits employers to offer incentives
(or impose penalties) of up to 30% of the cost of
self-only coverage. EEOC does not appear to disagree that
Declarant A would have standing to challenge
“part” of the rule, because his employer does
impose a 2% incentive for participation in its wellness
program. But it is unclear to the Court how Declarant A could
challenge part of the rule without challenging all of it.
Presumably, if the Court were to find that a 2% incentive
limit was arbitrary and capricious or otherwise inconsistent
with the ADA, ...