Employers reconsider abortion coverage as SCOTUS ruling looms

OVERVIEW

As the United States awaits the Supreme Court’s decision in Dobbs vs. Jacksonwho can overthrow Roe vs. Wade and eliminating the federal standard for access to abortion, some states are considering establishing their own standards that would prohibit or protect the medical procedure. This state-by-state regulation will cause some difficulties for employer plans.

IN DEPTH

Some employers fear that their employees cannot access abortion services where they live; for this reason, employers have taken steps to support access to abortion for their workers or dependents who live in states that prohibit such services. In addition to the cost of abortion care, individuals may face travel costs, which could pose a significant financial barrier, especially for low-wage workers. Therefore, employers add travel costs for medical services if such services are legally prohibited in the jurisdiction where the person resides. Note that this could also cover transgender surgeries or any other services that a state may ban in the future.

Apple, Citigroup, Mastercard, Starbucks and Microsoft are among the growing number of major companies that have publicly announced travel coverage for abortions.

Most employers who offer this benefit will do so through their existing health insurance plan. Including this benefit as part of the medical plan could help alleviate worker privacy concerns since health plans are subject to the Health Insurance Portability and Accountability Act of 1996 (HIPAA). Other employers have set up a separate fund outside of their medical plan from which workers can claim these expenses. Typically, the employer would administer the latter, creating possible privacy angst for both employer and employee.

The first thing an employer considering adding travel expense reimbursement to their health insurance plan should do is contact their medical plan’s claims administrator to determine if the claims administrator will administer the travel allowance.

LEGAL CONSIDERATIONS

Most large employers have self-funded health plans, which means they are not regulated by the states and therefore state laws limiting abortion coverage in fully insured plans do not apply. not to these plans. Additionally, state anti-abortion rules regulate providers who request abortions within the state. It would be legally overkill for a state to regulate a citizen who seeks lawful health services in another state. Similarly, an employer who reimburses travel to another state for access to lawful care in the destination state should also escape these prohibition laws.

That said, shortly after Citigroup announced it would cover travel costs to obtain an abortion, a Texas state legislator accused the company of violating state law that prohibits abortion. abortion after six weeks and which provides for civil penalties for anyone “aiding or abetting”. ” an abortion outside this period. In the U.S. House of Representatives and Senate, Republican lawmakers are also pushing for financial penalties for companies that cover travel costs for workers to obtain abortions.

COST CONSIDERATIONS

Employers trying to expand additional benefits to help workers access abortion care may want to review their health insurance plan coverage, including deductible levels, to make these benefits meaningful. for low-wage workers. These travel expenses would be considered “disabling coverage” if they were paid before a person had satisfied the annual deductible of their high-deductible healthcare plan, which would render that person ineligible for contributions to a health savings account.

Employers interested in continuing abortion coverage despite state restrictions should stay abreast of any federal and state developments, including any new guidelines or potential legislation that may emerge.

About Charles D. Goolsby

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