Issues For Employers After Dobbs v. Jackson Women's Health Organization

• Published date: 20 July 2022
• Subject Matter: Employment and HR, Discrimination, Disability & Sexual Harassment, Retirement, Superannuation & Pensions, Health & Safety, Employee Benefits & Compensation
• Law Firm: Arnold & Porter
• Author: Ms Mary Cassidy, Kathleen Wechter, Kathryn Geoffroy and Kaitlin A. Robinson

Following the Supreme Court's decision in Dobbs v. Jackson Women's Health Organization, which overturned Roe v. Wade, some employers are considering whether to offer coverage for abortion services and related travel expenses to employees and their dependents who reside in states that have banned or restricted abortion services. On the employee benefits side, there are various options available to employers depending on factors such as whether their existing health plans are self-insured or fully-insured, whether they offer high-deductible health plans with health savings accounts (HSAs) and whether they provide health plan coverage through a third-party professional employer organization (PEO). Employers providing health plans have always had to deal with numerous federal laws in administration (including the Employee Retirement Income Security Act (ERISA), the Affordable Care Act (ACA), the Health Insurance Portability and Accountability Act (HIPAA) and the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), but those with self-insured plans have had less experience with state laws since ERISA generally preempts many state laws. On the employment law side, employers need to be conscious of existing federal anti-discrimination laws related to pregnancy-related conditions, including abortion.

Due to the nature of the state-by-state regulation and ongoing developments in state and federal regulations, there is much uncertainty regarding many of these issues. Below is a brief summary of (1) some potential options to structure these employee benefits, including certain key issues and risks, and (2) the employment law issues that may arise.

Abortion Coverage Under Group Health Plans

Employers who are considering responses to employee concerns about the ability to obtain abortion services should first review the terms of their health plans to determine whether their plans provide coverage for abortion and the specific terms of such coverage.

Generally health plans (other than plans maintained by church and governmental organizations) are subject to ERISA, which generally preempts state laws to the extent they "relate to," among other things, health plan benefits. However, state law restrictions on abortion services could impact the ability of an employer to include such services in their health plans.

Employers that provide health coverage through fully-insured plans or through the plans of a PEO likely will have their desire to offer abortion coverage limited by the terms of the insurance carrier's or PEO's plans, which may have restrictions regarding the types of services that may be provided through their health policies or plans. Fully-insured plans, as opposed to self-insured plans, also are...