How Employers, Insurers are Coping With Abortion After Dobbs

An already-complicated patchwork of abortion coverage laws has become even more complex with the U.S. Supreme Court’s ruling to overturn Roe v. Wade.

“It really is all over the place,” says Fabiola Carrión, J.D., director of reproductive and sexual health for the National Health Law Program’s Los Angeles office. There were plenty of restrictions before, but “it’s becoming really complicated,” she saays

Some states had abortion bans that kicked in immediately after the court’s 5-4 ruling in June 2022. Others have seen their abortion bans temporarily blocked by the courts. And another group of states has moved in the opposite direction, strengthening their abortion rights statutes. “The legal landscape is changing rapidly,” says Meera Shah, M.D., M.P.H.,M.S., the national medical spokeswoman for Planned Parenthood Federation of America.

Even before the Supreme Court ruling, laws governing insurance coverage of abortion varied widely from state to state. As of July 1, 2022, seven states required private health plans to cover abortions, 11 states restricted insurance coverage from private insurance plans and 25 restricted coverage from plans offered on state health exchanges, according to Guttmacher Institute, a research and policy organization committed to supporting sexual and reproductive rights.

Coverage also varies tremendously for women who are insured through a health insurance. The 1977 Hyde Amendment forbids using federal funds for abortions unless a woman’s life is endangered or she is a victim of rape or incest, and many state Medicaid programs hew to that rule, which has been extended to include the military’s Tricare program, Medicare and the Indian Health Service. But 16 states get around the Hyde Amendment by using state funds to pay for abortions for women covered by their Medicaid programs.

Fully insured health plans are subject to state insurance regulation, but self-funded plans fall under the Employee Retirement Income Security Act and aren’t governed by state insurance law. Instead, they fall under the jurisdiction of the U.S. Department of Labor.

Travel benefits

With all the differences among states, “for insurers, it could mean one version of a plan in one state and another in another,” observes Sarah Raaii, J.D., an associate in the law firm McDermott Will & Emery in Chicago who focuses on employee benefits.

A number of health insurers, including CVS Health (the parent of Aetna), Cigna and Blue Shield of California have already come out in support of abortion rights and in support of their employees and clients. CVS Health said in an email: “We’ve made out-of-state care accessible for covered CVS Health employees residing in states that have instituted laws that limit access in their state. With the new (Supreme Court) decision, we are evaluating how we can best support the coverage needs of colleagues, clients and customers.” That includes, said the email, providing them “with the flexibility to choose medical and pharmacy benefits to best suit their needs. This includes, subject to plan terms and customer direction for self-funded plans, making out-of-state abortion health care services more accessible and affordable.”

Other payers, such as Blue Cross Blue Shield of Michigan and Blue Cross Blue Shield of Massachusetts, are developing or have developed a travel benefit for those who need to go out of state for an abortion. The Michigan Blues plan said in an email that group customers had requested expanded travel benefits for a number of services, including behavioral health and substance abuse disorder treatment, and that the payer was including an option for abortion coverage in the new benefit. The benefit will be available in the next month or two and will reimburse travel between the patient’s home and location at which they receive care.

But there are concerns that states in places where abortions are banned might try to restrict residents from traveling out of state for an abortion. “It’s potentially murky legal territory,” Raaii says. In a concurring opinion in Dobbs v. Jackson Women’s Health Organization, Justice Brett Kavanaugh said he didn’t think a state could prevent a woman from traveling to another state for abortion care. Raaii says when she has discussed Kavanaugh’s opinion with employers, “this has helped increase their confidence in an abortion travel benefit.” A number of major companies, including Tesla, Starbucks, JPMorgan Chase and Amazon, have said they will cover travel expenses for employees.

Much, though, remains unclear about the travel benefits and insurance coverage of abortion services in general. Carrión says even when companies and health plans say they will offer a travel benefit, it’s not clear the type of transportation that will be covered — the cost of gas if someone drives to another state, a bus ticket or an airline ticket. Will food and lodging be included? If so, for how many days? Carrión notes that some states have a waiting period of 24 to 72 hours before a woman can receive an abortion. Other variables include whether there will be coverage or consideration of loss of income and extra child care expenses.

Some statistics

In 2020, the most recent year for which figures are available, more than 930,000 abortions were performed in the United States, according to Guttmacher Institute. That was up slightly from 2019, when more than 916,000 abortions were performed. But it was far below the more than 1.5 million abortions that occurred in 1991. The abortion rate in 2020 was 14.4 per 1,000 women between the ages of 15 and 44. The rate has declined by half since 1981, when there were 29.3 abortions per 1,000 women. Access to contraception is believed to have helped reduce the abortion rate, and most private health insurance plans are required to cover contraception under the Affordable Care Act. Centers for Disease Control and Prevention data from 2019 for 47 states and the District of Columbia show that 57% of those who had abortions were in their 20s and that teens had just 9% of abortions.

President Joe Biden signed an executive order on July 8, 2022, that that directed the U.S. Department of Health and Human Services to protect and expand abortion access, including to medication abortions; ensure access to all women for emergency medical care; and protect access to contraception. The order does not address issues such as costs and insurance.

An abortion in the first trimester costs about $600, Carrión says. Even those with health insurance may need to cover that cost because many policies have high deductibles. “It’s a big amount for people with low and middle incomes,” she says.

“Hundreds of thousands of people can no longer access the abortion care that they need, and even more are living in confusion about what options are available to them,” says Shah of Planned Parenthood.

Carrie Baker, Ph.D., J.D., M.A., a professor of women and gender studies at Smith College in Northampton, Massachusetts, says her concern is: “Will women be doing dangerous things to get an illegal abortion?”

With the bans in effect, Carrión says that “the people who are going to be most affected are people on the margins who don’t have access to healthcare and services already.

“It will result in two Americas,” she adds. “One with abortion and one without.”

Susan Ladika is an independent journalist in Tampa, Florida, who writes about healthcare and business.