By Anna Wilde Mathews, Kathryn Dill, Emily Glazer and Chip Cutter, The Wall Street Journal, June 24, 2022
The Supreme Court’s decision overturning Roe v. Wade creates new challenges for employers and health insurers covering abortion services, especially whether and how to pay for travel to states where the procedure remains available.
Companies including Starbucks Corp., Uber Technologies Inc. and Amazon.com Inc. have said they would reimburse travel for medical services including abortion. Just Eat Takeaway.com, N.V.’s Grubhub and Dick’s Sporting Goods said they would provide up to $4,000 to cover expenses traveling for services not available in their home state.
“We recognize people feel passionately about this topic—and that there are teammates and athletes who will not agree with this decision,” Dick’s Chief Executive Officer Lauren Hobart wrote in an email to employees on Friday.
Thorny benefits issues pose a fresh challenge for many companies already struggling to navigate divisive social and political issues.
Companies that choose to cover abortion — and any travel necessary to get one—have to balance alienating employees agitating for their employers to take a stand versus the risk of legal attacks or political blowback in states that have banned the procedure.
“Benefits are suddenly starting to become very political, and it’s forcing employers to take a position,” said Michael Turpin, executive vice president at USI Holdings Corp., an insurance brokerage.
There are also questions of how much employers, especially smaller ones, can afford to invest, according to human-resources executives, CEOs and insurance experts.
On Friday, some executives quickly issued public statements regarding the Supreme Court’s decision. Yelp Inc. CEO Jeremy Stoppelman, who has been vocal on reproductive rights, said in a statement that business leaders needed to speak out against a wave of abortion bans expected to be triggered by the decision.
Julie Jones, chair of law firm Ropes & Gray, sent a memo to employees saying the firm would hold gatherings over the next few days to speak about the decision and give an overview of federal and state law on reproductive rights.
The firm’s lawyers are also in touch with its pro bono group to work on related cases, according to an email reviewed by The Wall Street Journal.
“As a woman, I have a profound feeling of vulnerability caused by the elimination of a longstanding right of women—a right that affects their bodies and their agency,” she wrote. Ropes & Gray has about 1,400 lawyers across the world.
Facebook parent Meta Platforms Inc. Chief Operating Officer Sheryl Sandberg called the Supreme Court decision “a huge setback,” and said in an Instagram post it jeopardizes the health of millions of women and girls.
A Meta spokesman said the company plans to offer travel-expense reimbursements to access out-of-state healthcare and reproductive services, and is “in the process of assessing how best to do so given the legal complexities involved.”
Without health insurance to foot the bill, obtaining an abortion can be costly. In the U.S., the median self-pay price for a medication abortion in 2020 was $560, and the median cost of a first-trimester procedural abortion was $575, according to a study published in April in the journal Health Affairs.
Many employers, especially the largest national companies, have been covering the procedures. Some 10% of American workers are enrolled in plans offered by employers that specifically excluded or tightly restricted it, according to a 2019 survey by the Kaiser Family Foundation.
As it became clear that the Supreme Court would overturn Roe, many other businesses have been working quietly behind the scenes to have a response ready to roll out when the court acted, according to benefits consultants.
Some 14% of large employers surveyed beginning in early June said they had a travel benefit in place, while another 25% said they were considering it, according to responses from nearly 300 employers to a survey being conducted by benefits consultant Mercer LLC.
Employers with at least 20,000 workers were the most likely to provide a travel and lodging benefit for employees traveling to receive an abortion, the survey said.
Major insurers that administer health benefits for big employers, including UnitedHealth Group Inc.’s UnitedHealthcare, Cigna Corp. and CVS Health Corp.’s Aetna, had been confirming to self-insured clients they can likely facilitate travel offerings, benefits consultants say.
Cigna and CVS said they are looking to support the coverage needs of their clients and customers. UnitedHealth Group said it remains committed to helping members and patients get access to their benefits and services.
Draft language that UnitedHealthcare recently sent to an employer for potential use in its plan document describing covered benefits, which was viewed by The Wall Street Journal, said the health plan would cover travel and lodging to a nearby state to get a covered healthcare service that isn’t legally available where the employee lives.
Given the sensitivities, many employers have been parsing state and local laws that relate to abortion access, as well as administration of company health benefits that are self-funded versus covered under a fully-insured plan, insurance experts, CEOs and HR executives said.
“Companies are figuring this out as it happens. It is a complex landscape ahead of us,” said Michele Ruiz, CEO of BiasSync, a Los Angeles-based software maker.
Employers will likely be careful in how they communicate about their plans, and how they design any new travel benefit. They will have to navigate various wrinkles, including that a generous travel benefit might result in taxable income for patients.
Also, to avoid estranging anyone, companies may structure the benefit to be broader than abortion, benefits experts said.
“It’s not singling out abortion, but abortion is included,” said Brian Marcotte, a healthcare consultant and former CEO of the Business Group on Health. Companies will “make the communication as an enhancement to their travel benefit, so they are addressing it but not directly, and not creating an uproar.”
Companies that say they are committed to providing such benefits say the legal complexities of ensuring coverage are fraught.
Yet covering abortion for employees who live in states where it is banned, and particularly facilitating access with services like travel, could create legal jeopardy for employers and the insurers that administer their health plans—and even potentially for individual employees, corporate officers or directors, legal experts said.
“You could have someone who goes after them for aiding and abetting an abortion,” said David Cohen, a law professor at Drexel University. “Employers are going to be put in the legal crosshairs, too.”
Before the new Supreme Court decision, governments had created a patchwork of abortion-coverage rules.
Many states’ Medicaid plans severely limit coverage of abortion, while federal programs like Medicare pay for it under very limited circumstances.
States have also restricted abortion coverage in private insurance, with 11 of them banning abortion coverage in all plans they regulate, according to the Kaiser Family Foundation. Yet state insurance rules don’t apply to the type of coverage that is most common among midsize and large employers, known as self-funded plans.
Self-funded plans, in which employers pay workers’ health claims with their own money, are regulated at the federal level.
Federal regulations for self-insured plans don’t spell out specific rules around abortion, lawyers say. A federal antidiscrimination statute requires all employers to provide health coverage to pay for an abortion if the life of the mother is at risk from the pregnancy, said Seth Perretta, an attorney at Groom Law Group who advises employers and health insurers.
If states do decide to enforce or enact laws that affect self-insured employers, they will set up court clashes. Employers will likely argue that state authority is pre-empted by federal laws that govern their plans, but lawyers said they don’t know what will happen if states seek to use criminal laws against employers.
Criminal laws that are broadly written may be able to overcome a pre-emption challenge, lawyers said.
“This is going to raise a lot of constitutional and legal issues,” said Kerri Willis, a senior vice president at Aon PLC’s U.S. Health Solutions unit. “We’re going to be in years of litigation over these issues.”
Bank of America Corp., Citigroup Inc., Goldman Sachs Group Inc. and JPMorgan Chase & Co. already cover abortion for workers who have their medical benefits. The banks recently told employees that they will pay for travel if people have to travel far from home to be treated. The banks, which employ tens of thousands of people around the country, described their decisions as ensuring equal access to healthcare.
JPMorgan said it would start covering travel costs for all covered healthcare procedures on July 1, according to an internal memo. The bank had previously covered travel expenses only for limited cases, such as organ transplants and bariatric surgery. The benefit covers the cost of traveling more than 50 miles.
Heather Haddon contributed to this article.