I’m Leaving On A Jet Plane…Is Abortion Care Travel a Covered Benefit?

by Benjamin Gibbons

The focus of this week’s post is on an emerging hot topic, abortion care travel reimbursement. Reimbursement for travel to obtain abortion care was already something being considered by a number of companies in response to the recent Texas fetal heartbeat law and similar laws in other states. With the recently leaked Supreme Court draft opinion that stands to overturn Roe v. Wade, both the need for such a benefit and employers’ interest in offering travel reimbursements has increased significantly. If Roe is overturned, access to abortions will be largely prohibited in the 13 states with so called “trigger laws” and could be significantly restricted in at least 13 other states.

Many employers, both with and without significant concentrations of employees in the potentially affected states, are racing to put abortion care travel benefits in place so that their employees in need of abortion care are able to travel to states with less restrictive abortion laws. The list of large publicly traded companies that have begun offering abortion care travel benefits is growing and includes Amazon, Apple, Microsoft, Starbucks, Tesla and many more. Interest is also increasing for privately-held companies.

There are numerous considerations that employers should consider when designing an abortion care travel reimbursement benefit, including:

• Do the travel expenses constitute medical care? Depending on what expenses are covered and how much is being reimbursed, some expenses may be medical care and some may not.
• Will the travel reimbursement benefit be offered under the company’s group health plan? If the travel reimbursement is considered to be a medical expense, employers will generally need to integrate the benefit with the company’s group health plan to ensure compliance with the Affordable Care Act.
• How will state laws impact an employer’s ability to provide the travel reimbursement benefit? For employers with self-insured plans, ERISA should arguably preempt any conflicting state laws. For employer’s with fully-insured plans, preemption may not be available, and it is possible that state laws could be designed to prohibit travel reimbursement.
• Will the reimbursement be taxable compensation to employees? Generally, yes, except to the extent the reimbursements qualify as medical expenses.
• Other considerations:
  • Impact on eligibility for an employee’s participation in a health savings account (HSA).
  • HIPAA and privacy issues.
  • Ability to permit mid-year election changes in connection with the addition of the benefit.

Abortion care travel reimbursement is not a one-size-fits-all benefit. Employers should consult with legal counsel to understand the known and potential impacts of offering abortion care travel reimbursements.