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Considerations for Employers Dealing with Abortion Issues

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The Supreme Court decision in Dobbs v. Jackson Women's Health on June 24, 2022, returned abortion issues to the states, allowing each state to "address abortion as it pleases."  It is expected that approximately half of the states will pass some type of state laws prohibiting abortion totally or partially, although some of these state laws may at least be temporarily blocked in litigation.  Many of the remaining states are likely to provide even stronger protection to abortion access.  Issues will be created when a resident of Missouri, for example, which bans abortion, goes to Illinois, where abortion is still permitted, and what happens where a resident of Missouri receives abortion medication from a New York doctor?  

Justice Brett Kavanaugh, in his concurring opinion, expressed the view that a state may not bar a resident of a state from traveling to another state to obtain an abortion, based on the Constitutional right to interstate travel.  The general rule is that one state ordinarily cannot prosecute a person for something that occurred in another state, but the situation can get complicated.  Can someone be charged for aiding pregnant women in Missouri to travel out of state, such as an employer providing abortion assistance, or the person who supplied the car and drove her to Illinois, for aiding and abetting the abortion?

Abortion pills can now be prescribed by telehealth appointments and mailed directly to homes.  In some areas, mobile abortion clinics are being set up.  But are buying abortion pills a form of "drug trafficking?"  There is an incredible amount of uncertainty about what these issues mean for employers and employees, whether benefits are managed by a health-insurance provider or human resource departments, and how employees' privacy will be protected.  

Employers with employees in states that prohibit abortions are reviewing whether to cover abortions in their health plans, and making decisions on whether they want to pay for employees to travel out of state for abortion drugs and procedures.  

The number of issues employers face include discrimination, health confidentiality, workplace conduct, employee benefits, and regulatory compliance.  Employers must also evaluate how such issues affect their relationships with employees, customers, and stockholders. 

A majority of HR executives tend to feel that they do not plan to change their current healthcare offerings or are still evaluating options.  Those companies wishing to support abortion rights have mostly decided to offer up reimbursement for travel and healthcare costs to employees who have to get such care out of state.

Self-insured employer plans are generally covered by the Employee Retirement Income Security Act of 1974 (ERISA), and so arguably ERISA-covered plans may pre-empt state law.  While sensitive patient care information is federally protected via the Health Insurance Portability and Accountability Act of 1996, or HIPAA, benefits administered separately, such as travel reimbursement for an out of state abortion, are not.  There are also tax implications.  If abortion-related travel coverage is viewed as "a significant benefit in the nature of medical care," participants in high-deductible health plans would have to meet their annual deductibles of at least $1,400 for individuals or $2,800 for families before the plan could pay for abortion-related travel.  Business groups are seeking guidance and have sent a letter to three government agencies on the Dobbs ruling, including the Secretaries of Human Health and Human Services, Labor, and Treasury.  These business groups are seeking guidance on updating privacy protections under HIPAA, and Treasury/IRS guidance assuring plan sponsors that travel benefits meeting tax code requirements are not considered significant medical benefits, and thus are not taxable.

In contrast, fully-insured plans that smaller employers often use are generally subject to state regulation.  Even HIPAA has exceptions that allow information to be disclosed for law enforcement purposes, such as when there is a court order, warrant, or subpoena regarding the disclosure.  

Employers may be asked about how they would handle a personal data request related to abortion.  According to a statement issued by Meta, "We comply with government requests for user information only where we have a good-faith belief that the law requires us to do so.  In addition, we assess whether a request is consistent with internationally recognized standards on human rights."

Employers can also generally still expect to be held liable under the Pregnancy Discrimination Act and Title VII of the Civil Rights Act if they treat employees differently for having had an abortion, seeking one, or choosing not to have one.  The Dobbs decision did not address employment discrimination issues.

In the meantime, President Biden has signed two executive orders intended to improve access to abortion services which direct the Secretary of Health and Human Services to consider actions to help patients travel outside their states for abortions using funds from Medicaid.  This move will likely be challenged in the courts.  The Justice Department has also filed its first post-Roe lawsuit on abortion rights, suing the State of Idaho over its law banning abortion after six weeks.  The Department of Justice (DOJ) contends that federal law requires doctors and hospitals to perform medically required abortions to preserve a pregnant woman's health.  The lawsuit relies on the Emergency Medical Treatment and Labor Act, which requires hospitals to provide treatment to save a patient's life, as well as to prevent organ dysfunction or serious impairment of bodily function.

Many states have privacy laws that extend beyond those in the U.S. Constitution, and thus the rationale of the Dobbs ruling.  A number of lawsuits are being filed in states challenging abortion limitations under state constitutional privacy laws.  

So what is an employer to do?  At the beginning, employers should review what policies they currently have in their healthcare plans.  Many employers will need to consult with their third-party administrators to determine their responsibility for government inquiries concerning abortion services.  Employers can also begin exploring conservative practices that limit legal liability and privacy violations, such as limiting retained information on employees who sought these services. 

This article is part of our September 2022 Newsletter.

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