The Supreme Court is expected to uphold a Mississippi law banning abortions after fifteen weeks in its decision on Dobbs v. Jackson Women’s Health Organization. Even if the ruling does not explicitly overturn the precedents of Roe v. Wade and Planned Parenthood v. Casey like the draft opinion leaked in early May suggested it would, this ruling would functionally overturn those precedents and would have the same practical effect for patients across the country. A ruling that overturns Roe would also allow laws banning abortion in nearly twenty states to go into effect, making abortion care illegal in nearly half the country. Following such a decision, several other states would likely enact bans, further limiting access to this necessary health care. While such a ruling would not ban abortion nationwide, anti-choice members of Congress have suggested they might try to do so.
In anticipation of the ruling, several states took a different approach, announcing their intent instead to protect or even expand abortion access through state law. This is welcome news, but as part of this approach, states should also ensure that their insurance laws and regulations support this goal as well. Insurance coverage is a necessary component of providing abortion access. Low-income pregnant people constitute an overwhelming majority of patients seeking abortion care. About 46 percent of women with private insurance had policies that did not cover abortion, according to a 2013 survey of abortion patients, and the same study found that more than half of women paying out of pocket for an abortion found it difficult to pay for the procedure.
This commentary describes how states can support access to abortion care through their insurance regulations. First, it describes how coverage mandates in Medicaid and private insurance can be used to promote abortion access. After this, it highlights a federal law that interferes with states’ ability to require abortion coverage. It then discusses what comprehensive abortion coverage should include in order to support this vital health care for pregnant people.
Despite Hyde, States Can Use Own Funds to Cover Abortion under Medicaid
Medicaid is a public health insurance program for low-income people funded jointly by states and the federal government. States generally receive federal funds for at least half of their Medicaid costs, and states with lower per-capita income receive a higher percentage. Federal law requires states to cover certain benefits as a condition of receiving this money, and other benefits, such as prescription drugs, are optional. A provision added to federal appropriations laws each year, however, prohibits these federal funds from being spent on abortions outside of limited exceptions for rape, incest, and endangerment of the life of the pregnant person, which are required to be covered.
This provision, known as the Hyde Amendment, disproportionately impacts poor women and women of color, both of whom are more likely to be enrolled in a form of insurance restricted by Hyde. However, it does not prohibit states from spending their own money on abortion care outside of these exceptions. According to the Guttmacher Institute, sixteen states fill in the gaps created by the restriction on federal funds by covering all or most medically necessary abortions with state funds; nine of these do so pursuant to a court order. In total, twenty-four states and the District of Columbia are unlikely to ban abortions in the aftermath of this ruling.
These states should ensure that their policies promote abortion access for their Medicaid enrollees. In particular, states that currently provide Medicaid coverage of abortion only because of court orders should pass laws guaranteeing such coverage. In filling in coverage gaps created by the Hyde Amendment, states should also ensure that their Medicaid programs have reimbursement rates for abortion care that are sufficient enough to incentivize providers to accept Medicaid patients.
States Can Require Private Coverage of Abortion
In addition to ensuring that their Medicaid programs cover abortion, states should work to ensure that the roughly 14.5 million people purchasing private insurance through the Affordable Care Act’s health insurance marketplaces have plans that cover abortion. The Affordable Care Act established marketplaces in each state to facilitate the purchase of individual health coverage for households without access to employer-sponsored insurance or public coverage. Broad federal rules regulate what plans on these marketplace exchanges must cover, but states can and do include additional regulations, including abortion coverage regulations.
Many states have already used this authority to regulate abortion coverage. To date, thirty-four states have banned abortion coverage in marketplace plans, while only four states—California, New York, Oregon, and Washington state—require coverage of abortions. In eight of the twelve states that neither ban nor require coverage, there are no marketplace plans that cover abortion services. States that want to support abortion access should also ensure that private insurers, including marketplace insurers, are required to cover abortion.
MAP 2. ABORTION COVERAGE UNDER PRIVATE INSURANCE
ERISA: A Federal Law that Undermines State Requirements
The Employee Retirement Income Security Act of 1974, also known as ERISA, is a federal law intended to “provide uniform, federal regulation of pensions and employee benefit plans” by establishing federal standards for employee benefits, including health coverage. Part of the law includes a sweeping preemption of nearly any state regulation of employee benefit plans, severely limiting the regulations states can put in place. This preemption only applies to self-funded plans: plans where the employer takes on the risk of paying claims, rather than an insurer taking on that risk.
While ERISA does not directly regulate coverage of services such as abortion, it does limit some state abilities to require coverage. State laws that regulate insurance companies are exempt from ERISA preemption, but neither employers offering self-funded plans nor third-party administrators carrying out self-funded plans are considered insurers under the law. As a result, only fully insured plans—in which the employer pays premiums to an insurer who takes on the risk of paying claims—escape ERISA preemption and can be subject to state regulation. Around two-thirds of workers with employer-sponsored insurance are in self-funded plans, meaning federal action would be necessary to ensure that every patient with private insurance has abortion coverage.
It is also important to note that ERISA does not apply to criminal laws. Because of this, even employers providing self-funded plans or their third-party administrators could be subject to legal action in states such as Texas that have moved to criminalize “facilitating” abortions. An employer choosing to provide a travel benefit to employees seeking abortion care in another state through a self-funded plan, for example, could be sued under these laws.
Abortion Coverage Should Be Comprehensive
Beyond simply mandating coverage, states should ensure that abortion coverage is substantive and meets the needs of all patients in their state. Abortion care provision falls into two general categories: medication abortion and procedural abortion. Medication abortion care most commonly consists of taking two drugs, mifepristone and misoprostol, to end a pregnancy. The approach is safe, effective, and often more affordable than in-clinic care. Procedural abortion, also called an in-clinic or aspiration abortion, uses suction to empty the uterus.
Covering all forms of abortion care is essential to promoting access. According to survey data by the Guttmacher Institute, medication abortions account for more than half of all abortions in the United States. It is critical that every patient is able to choose what type of abortion care they receive, and insurance coverage should not limit this decision. Medication abortion care is not an option for patients seeking care later in pregnancy—a situation that will likely only become more common, as bans and increased clinic wait times push patients seeking abortion further into their pregnancies—while other patients will prefer procedural care regardless of gestation.
In addition to covering all methods of abortion care, coverage laws should ensure that insurance companies do not place restrictions on this coverage that undermine its use. Just as the Affordable Care Act requires insurers to cover contraceptives without cost-sharing, states should prohibit cost-sharing for abortion. The median charges for abortion care ranges from $560 for medication abortion and $575 for a first-trimester procedural abortion up to $895 for a second-trimester procedural abortion. More than one-third of Americans would not be able to cover a $400 emergency expense completely with cash, and this inability to pay would be even more likely for lower-income people who make up the majority of abortion patients. While abortion funds and mutual aid has met some of this need in the past, insured patients should be able to expect their insurance plan to cover their health care, including abortion care. Cost-sharing would represent a substantial barrier to abortion access, meaning coverage for many people would be in name only.
In addition to prohibiting cost-sharing, states should ensure that insurers do not impose restrictions on coverage, such as prior authorization or limitations on medication abortion off-label use. Many insurance companies refuse to cover off-label prescriptions of drugs, even if there is evidence that the drug would be effective for a patient. Patients who need an abortion should be able to access whatever method they and their health provider determine is most appropriate for them, without additional restrictions put in place by their insurance company.
Covering Abortion Care Is a Necessary Response to the Supreme Court Decision
The Supreme Court is likely to take an extreme stance, functionally removing the federal right to an abortion that more than two-thirds of the country supports. As states respond to this ruling and work to promote abortion access, simply declining to ban abortion care is the bare minimum. Abortion care must be affordable to be accessible, so states should examine their insurance laws and make certain that Medicaid and private insurers are required to cover abortion care. This coverage must be robust and limit utilization management policies, much like the Affordable Care Act’s contraceptive coverage mandate. States need to ensure that people seeking an abortion are supported in doing so, not just unhindered.