Expanding Abortion Coverage, Including Medical Travel Benefits, Through Your Employer Sponsored Health Plan
Overview
Abortion is a key component of workers’ reproductive and maternal healthcare. The ability to choose if, when, and how to have a child is crucial to workers’ health and wellbeing personally and professionally. For employees who live in states where abortion is outlawed or restricted, access to safe abortion care for themselves or their family can be difficult and costly.
According to our research, the majority (85%) of companies do offer some sort of abortion travel benefit but unfortunately, the coverage is not always as comprehensive as it could be, nor is workers’ health data consistently protected. RMH Compass’ proprietary data finds that only 22% of companies use a third party to administer their abortion travel benefit, leaving companies and employees exposed. Well-intentioned employers that do not administer abortion travel reimbursement through a third party miss a critical safeguard. Without this safeguard, employees must disclose personal health information to HR, finance and/or their managers, undermining trust and exposing the company to legal risk.
Most workers in the U.S. do not have sufficient savings to cover unexpected medical expenses. The financial fragility of many workers is underscored by the fact that 37% of adults would have to dip into savings, borrow money, or sell something to cover a $400 expense (according to the Federal Reserve). Costs associated with obtaining abortion care, especially if travel is required, almost always exceed $400.
Employers have a responsibility to provide these benefits – and an opportunity to set a high-standard in doing so – as the implications for workers when they do not have access are significant.
The Turnaway Study has found that the economic and health consequences of being denied abortion care for women can be dire and life-altering.
Economic Impact
Four times greater odds of living below the Federal Poverty Level (FPL).
Greater likelihood of not having enough money for basic living expenses (food, housing, transportation).
Lower credit scores, increased debt, and more negative public financial records (e.g. bankruptcies, evictions).
Taking longer to achieve similar levels of employment as those who received abortions.
Health Impact
More serious complications from the end of pregnancy, such as eclampsia and infections.
Greater chronic pain and fair or poor health for years after the pregnancy.
These health complications can have a direct financial impact on an employer if they provide healthcare via a self-insured plan. Data shows when workers are stressed about finances and health expenses, they are more likely to have increased absenteeism and lower productivity, also having a negative financial impact on the employer. In conclusion, there are compelling business reasons for employers to implement comprehensive, well-designed abortion and medical travel benefits.
There are a range of actions employers should take to ensure they have comprehensive abortion benefits in place. Once these benefits are affirmed, employers must communicate clearly to workers what the benefits are and how employees can safely take advantage of them.
RMH Compass considers a best-in-class benefit one that covers elective and non-elective abortion, with a medical travel reimbursement benefit that has no dollar limit through an Employer-Sponsored Health Plan (ESHP), plus a Lifestyle Spending Account (LSA) or Employee Relief Fund (ERF) that can cover unreimbursed travel costs, such as childcare, lodging and mileage.
This position is informed with several considerations in mind including:
Comprehensiveness of coverage
Data privacy considerations
Ease of use for employees
Cost to employer
Cost to employee
We recommend using an Employer Sponsored Health Plan (ESHP) to deliver reproductive health care because it utilizes the same administrative systems as delivery of all other types of health care for enrolled workers, ensuring a smooth flow of information about in-network providers, cost-sharing and reimbursement.
Importantly, ESHPs comply with HIPAA data standards, which restrict who can access worker’s personal health information, including data on healthcare services received and costs covered.
We distinguish our employer recommendations below based on whether the employer is on a self-insured health plan (easiest path) or a fully-insured health plan (more complexity in finding the right solution).
Self-Insured Employers
Larger employers, generally those with 500 or more employees, often secure health coverage under a self-insured health plan structure. While this means there is a risk of higher-than-expected health care expense totals for the employer, there is also the opportunity for lower health care costs per year. The risk is in the variability of total cost.
Self-insured plans are subject to federal ERISA requirements (ERISA is the Employee Retirement Income Security Act of 1974). This means the employer can craft their health plan coverage without concern for specific state requirements or limits. Any self-insured employer has the ability to cover elective and non-elective (also referenced as voluntary and non-voluntary) abortion via their ESHP. They also have the ability to cover travel costs for any medical care where in-network providers require traveling more than a defined number of miles or out-of-state. Exact mileage can be defined by the employer; we’ve seen a range of 60 to 200 miles as the qualifying distance. They can define a cap on medical travel expenses or implement without a dollar cap. Medical travel reimbursement through an ESHP can cover the cost of travel for a companion as well.
There are a few limitations with this approach, including that reimbursement rates are set by the IRS and are woefully low for certain expenses, such as hotel and mileage costs. Current IRS reimbursement rates cap nightly hotel rates at $50 ($100 if a support companion is traveling) and medical reimbursement mileage cost is $0.21 per mile. It’s worth noting that by contrast, for business travel, the reimbursement rate is $0.70 per mile. Childcare costs are also not considered a reimbursable expense. Lodging and tolls can be reimbursed, as can airline flights. To understand how an employer can safely cover those additional, unreimbursed costs, our resource entitled Additional Reimbursement Mechanisms for Medical Travel provides detail on how LSA or ERFs can be an added benefit.
Fully-Insured Employers
Smaller companies, generally those with fewer than 500 employees, usually opt for a fully-insured health plan to control the risks associated with variable health care expenses. Fully-insured employers essentially buy off-the-shelf health plans that establish a predetermined fee per employee, regardless of actual medical costs incurred. Coverage of health services under fully-insured plans are mandated by state regulators and administered by an insurance company (e.g. Cigna, Aetna). As a result, these fully-insured plans may not cover comprehensive abortion care or abortion travel reimbursement, depending on the state regulations in place. The good news is that employers do have options to add coverage even when using a fully-insured health plan.
Fully-insured employers headquartered in states that cover abortion care have more options – they should be able to negotiate a supplement, or rider, via their health insurance provider that adds coverage for abortion care (elective and non-elective, if this is not already covered by the base plan) and add coverage for medical travel reimbursement. Medical travel reimbursement can and should be broadly defined for a range of medical purposes.
Our research has found that adding medical travel reimbursement often does not change the cost or has a minimal financial impact on the cost of health coverage under a fully-insured plan.
Another option for employers under a fully-insured health plan is to add a Speciality Health Reimbursement Account (HRA). This is an option for employers in states that have restrictions in place on reproductive health services. Using this approach, the Speciality HRA is a self-insured health plan (meaning, it can be designed under ERISA guidelines, not state guidelines) customized according to employer-coverage preferences. Using this approach, the employer can set up the HRA to cover a specific care need, such as mental health services, fertility services, or abortion care and medical travel reimbursement. While the HRA is considered a self-insured plan – meaning, any expenses incurred would be paid by the employer (so if no employees use the HRA-covered benefits, it would be $0, and if many used it, it could be a significant expense) – it is integrated administratively into the fully-insured plan benefit. Some legal experts have raised concerns that offering a Specialty HRA alongside a fully-insured plan could pose legal and data privacy risks, particularly in states with restrictive reproductive health laws. While we are not aware of any legal action to date, the regulatory landscape is evolving, and employers should evaluate this option carefully with legal counsel.
Companies should ask the following questions of their benefits brokers to understand what is currently covered and what can be added to coverage prior to their next Open Enrollment.
Talking to Your Benefits Broker
Companies should ask the following questions of their benefits brokers to understand what is currently covered and what can be added to coverage prior to their next Open Enrollment.
What to ask your benefits brokers or insurance provider to ensure your benefits meet the standard:
What is our medical coverage for abortion? Do our plan offerings cover non-elective and elective abortion care, or just medically necessary care?
If our plans currently only cover medically-necessary abortion, what steps do we need to take to include both elective and non-elective abortion in our plans for our next Open Enrollment period?
What is the language in our policy about how medical travel reimbursement is covered and where can that be found? Are there any restrictions on the type of care that can be accessed under this medical travel reimbursement benefit?
If we do not currently have a medical travel reimbursement benefit (or have a medical travel reimbursement benefit that excludes abortion care) in our ESHP, what are the options and cost to add it as a supplement or rider to our plan for our next Open Enrollment period? If adding the supplement is not an option, tell me how we can add a Speciality HRA to cover this?
What are the specific protocols for employees to access the medical travel reimbursement benefits?
If your benefits broker or insurer says that none of these enhancements are possible under your current plan, we recommend you speak with other brokers and insurers – and we have a few we can recommend. You may also consider speaking with benefits vendors who offer a range of flexible benefits solutions, including pre-tax accounts and employer sponsored accounts
The Takeaway
The best practice for all employers is to offer comprehensive abortion care (elective or voluntary and non-elective or non-voluntary) and medical travel reimbursement via an ESHP.
If this approach is not feasible, or if your company wants to be able to reimburse for medical expenses beyond the IRS defined limits — for the full-cost of lodging, mileage, and childcare costs — visit our other resource, Additional Options for Reimbursing Medical Travel Expenses.
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