Federal Agencies Issue Firm Reminder that No-Cost Coverage Requirements for Employee Contraceptives Remain Post-Roe

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Foley & Lardner LLPOn July 28, 2022, in light of the United States Supreme Court’s recent decision overturning Roe v. Wade, the United States Department of Labor (DOL), in conjunction with the Departments of Health and Human Services (“HHS”) and the Treasury, issued important guidance surrounding the topic of reproductive rights issues in the workplace. 

Through this guidance, the federal agencies communicate a stern reminder that notwithstanding the Court’s decision and the related ongoing political debate over reproductive rights, covered health plans and health insurance issuers must continue providing insurance coverage for contraceptives at no cost to plan participants.  It is the latest in a series of post-Roe federal actions aimed at reinforcing an individual’s right to seek and receive reproductive services.  Employers should keep a close eye on this (and other) federal guidance, as such agency reminders often signal areas in which enforcement actions may be on the horizon.  Consequently, employers should take caution to ensure that they address this issue from both compliance and employee-relations perspectives.

The guidance reemphasizes the existing requirement under the Affordable Care Act (ACA), and its related regulations that covered group health plans and health insurance issuers must provide coverage, without imposing any cost-sharing requirements, for certain “preventive services.”  Among the category of these preventive services are specific provisions for women’s care, including additional preventive care and screenings as supported in guidelines promulgated by the Health Resources and Services Administration (HRSA). 

Under its current Women’s Preventive Services Guidelines, the HRSA recommends that adolescent and adult women should have access to the comprehensive range of contraceptive methods approved by the United States Food and Drug Administration (FDA), effective family planning practices, and sterilization procedures to prevent unintended pregnancy and to improve birth outcomes. 

Furthermore, HRSA recommends that adequate contraceptive care should include contraceptive counseling, initiating contraceptive use, and certain follow-up care focusing on management and evaluation of applicable contraceptive methods.  Likewise, recommended contraceptive care should include instruction and education in fertility awareness-based methods for women who seek an alternative method.  In more recently published guidance, the HRSA added critical care services such as well-woman preventive care visits, access to contraceptives, and access to contraceptive counseling, among other related services. 

Only when a recommendation or guidelines do not specify the frequency, method, treatment, or setting for the provision of a recommended preventive service may the health plan or health insurance issuer use its “reasonable medical management” techniques to determine coverage limitations.  Relatedly, the new guidance explains that group health plans and health insurance issuers cannot use their “medical management” authority to require a plan participant to use a type of contraception that differs from that which the participant’s medical provider recommended for care.  In the case of a medical provider recommending a particular service or FDA-approved product that is not expressly included in HRSA’s guidelines, based on the provider’s determination of medical necessity for a given individual, the group health plan or health insurance issuer is prohibited from denying that service or product.  Rather, they “must defer to the determination of the attending provider, and make available an easily accessible, transparent, and sufficiently expedient exceptions process that is not unduly burdensome” and that allows coverage for the medically necessary service or product without any cost sharing. 

These broad requirements extend to FDA-approved emergency contraception, including over-the-counter products that are prescribed for an individual.  In contrast, the guidance merely encourages, but does not require, group health plans and health insurance issuers to cover over-the-counter emergency contraceptive products with no cost sharing if purchased without a prescription.

While certainly not a new feature of the PHS Act, the DOL and its partner agencies are making clear through this guidance that health plans and health insurance issuers, and, by extension, employers, remain under the same general obligation to cover contraceptive services without cost sharing, despite the Court’s recent decision that overturned the half-century old holding in Roe. DOL’s guidance follows an executive order that President Biden issued on July 8, 2022, aimed at protecting access to reproductive healthcare services.  The Executive Order states in no uncertain terms that “the Federal Government is taking action to protect healthcare service delivery and promote access to critical reproductive healthcare services, including abortion.”  It directs a number of federal agencies to take prompt actions consistent with this directive.  Along that line, employers should be on the lookout for revised guidance from HHS regarding obligations under the Health Insurance Portability and Accountability Act (HIPAA), as the Executive Order seeks “to strengthen the protection of sensitive information related to reproductive healthcare services and bolster patient-provider confidentiality.”

During comments made in connection with the release of this guidance, Secretary of Labor Marty Walsh noted that the government has received “troubling reports” of group health plans and health insurance issuers failing to observe the requirements outlined in the guidance.  In addition, Secretary Walsh did not mince his words in declaring that the Biden Administration will pursue enforcement actions as necessary to ensure that health plan participants receive unimpeded access to contraceptive coverage without the burden of sharing in associated costs.  Indeed, the guidance specifically states that the federal agencies issued it, in part, “in response to reports that individuals continue to experience difficulty accessing contraceptive coverage without cost sharing.”

The guidance further addresses the intersection between federal and state law, as the Court’s decision overturning Roe arguably invites states to pursue their own limitations on reproductive rights.  On this issue, the guidance explains that the PHS Act, and other relevant federal law, specifies that state law will be preempted by federal law to the extent state law prevents a provision of the PHS Act from being applied.  Moreover, if HHS determines that a state is enforcing a state law that is inconsistent with the PHS Act, then HHS will utilize its investigatory and enforcement powers to obtain compliance from health insurance issuers in that state.

Employers should heed this warning and anticipate that any federal agencies with oversight authority will ramp up enforcement actions to promote compliance.  Moreover, employers should become familiar with this guidance, and feel comfortable relying on it, as they manage the workplace environment and personnel issues following the overturn of Roe.  It is foreseeable that employees who fall on different sides of this sensitive political debate may seek information on the topic of covered contraceptive products and services.  A comprehensive understanding of the obligations in play will undoubtedly aid employers in that undertaking.

The Court’s decision in Dobbs v. Jackson Women’s Health Organization has generated numerous employee benefit issues and considerations for employers across the nation.  As just one example of this phenomenon, many employers have considered providing abortion travel benefits to employees who are required to travel out of state to obtain care.  On that topic, Foley’s Employee Benefits and Executive Compensation Group recently outlined key considerations in its article, "Key Considerations When Offering Abortion Coverage Under a Group Health Plan.”  To receive this and other related guidance, employers should subscribe to Foley’s “Employee Benefits Insights” monthly newsletter by clicking here.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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