Legal clashes await US companies that cover workers’ abortion costs

(Reuters) – A growing number of major US companies have said they will cover travel costs for employees who must leave their home countries to have abortions, but these new policies could expose companies to lawsuits and even potential criminal liability, legal experts said. .

Amazon.com Inc (AMZN.O), Apple Inc (AAPL.O), Lyft Inc (LYFT.O), Microsoft Corp (MSFT.O), and JPMorgan Chase & Co (JPM.N) were among the companies that announced Its plans to offer these benefits through their health insurance plans in anticipation of Friday’s US Supreme Court ruling repealing the Roe v. Wade ruled that legalized abortion nationwide. Read more

Within an hour of the decision, Conde Nast CEO Roger Lynch sent a memo to employees announcing the travel compensation policy and calling the court ruling a “severe blow to reproductive rights.” The Walt Disney Company (DIS.N) unveiled a similar policy Friday, telling employees it understands the impact of the abortion ruling but remains committed to providing universal access to quality health care, according to a spokesperson. Read more

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Health Insurance Company Cigna Corp (CI.N), Paypal Holdings Inc (PYPL.O), Alaska Airlines Inc Dick’s Sporting Goods Inc (DKS.N) also announced reimbursement policies on Friday.

Abortion restrictions that were already on the books in 13 states took effect as a result of Friday’s decision and dozens of other Republican-led states are expected to ban abortions.

The court’s decision, motivated by its conservative majority, upheld a Mississippi law banning abortion after 15 weeks. Meanwhile, some Democratic-led states are moving to boost access to abortion.

Companies will have to get through this patchwork of state laws and are likely to anger anti-abortion groups and Republican-led states if they adopt policies supportive of employees who undergo abortions.

Texas lawmakers have already threatened Citigroup Inc (CN) and Lyft, which earlier announced travel reimbursement policies, with legal repercussions. In a letter last month to Lyft CEO Logan Green, a group of Republican lawmakers said Texas would “take swift and decisive action” if the taxi company implemented the policy.

Lawmakers also outlined a series of abortion-related proposals, including a bill that would ban businesses from doing business in Texas if they pay state residents to receive abortions elsewhere.

lawsuits filed

It’s likely only a matter of time before companies face lawsuits from states or anti-abortion activists alleging that abortion-related payments violate state bans on facilitating, assisting and abetting abortions, according to Robin Fritwell Wilson, a law professor at the University of Illinois. An expert in healthcare law.

“If you can sue me as a person for carrying your daughter across state lines, you can sue Amazon to pay for it,” Wilson said.

Amazon, Citigroup, and other companies that announced their payment policies did not respond to requests for comment. “We believe access to healthcare is essential and transportation should not be a barrier to that access,” a Lyft spokesperson said.

For many large companies that fund their own health plans, federal law regulating employee benefits will provide crucial coverage in civil lawsuits related to reimbursement policies, several attorneys and other legal experts said.

The Employee Income Security Act of 1974 (ERISA) prohibits states from adopting requirements that “relate” to employer-sponsored health plans. Courts for decades have interpreted this language as prohibiting state laws that dictate what health plans can and cannot cover.

ERISA regulates benefit plans that are funded directly by employers, known as self-insurance plans. In 2021, 64% of American workers with employer-sponsored health insurance were covered by self-insurance plans, according to the Kaiser Family Foundation.

Any company that sued over a travel reimbursement requirement for an abortion is likely to cite an abortion as a defense, according to Katie Johnson, senior health policy advisor at the US Benefits Council’s trade group. She said this would be a strong argument, particularly for companies that have general reimbursement policies for essential medical-related travel rather than those for abortion.

Johnson said reimbursements for other types of medical-related travel, such as visits to hospitals designated “centers of excellence,” are already common even though abortion-related policies are still relatively rare.

“While this may sound new, it is not in the general sense and the law really tells us how to deal with it,” Johnson said.

Limit

The argument has its limits. Fully insured health plans, in which employers purchase coverage through a commercial insurer, cover about a third of covered workers and are regulated by state law, not ERISA.

Most U.S. small and medium-sized businesses have fully insured plans and can’t argue that ERISA prevents states from limiting abortion coverage.

Nor can ERISA prevent states from enforcing criminal laws, such as those in many states that make assisted abortion a crime. So employers who adopt reimbursement policies are exposed to criminal charges from state and local prosecutors.

But since most criminal abortion laws have not been enforced in decades, since the Roe decision, it’s unclear whether officials will try to sue the companies, according to Danita Merlau, a Chicago attorney who advises companies on benefits issues.

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(Reporting by Daniel Wisner in Albany, New York; Editing by Alexia Garamfalvi, Grant McCall and Bill Bercrot)

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