The reversal of Roe v. Wade: 3 things to know and 3 steps to evaluate your benefits offerings

Anxiety is high following the reversal of Roe v. Wade, and it is easy to get swept up in the emotion of it. As employers consider their next steps, it is important to determine its impacts, review options and prepare a response to it.

The basics: What to know

In 1973, the U.S. Supreme Court ruled in Roe v. Wade that the Constitution of the United States protects a pregnant woman’s right to have an abortion. Nearly 50 years later, the court voted 6-3 to uphold Mississippi’s ban on abortion after 15 weeks of pregnancy and voted 5-4 to explicitly overturn Roe v. Wade. There are a few misconceptions floating around, so it is important to know what it means (and what it doesn’t).

1. Federal protections end: The decision to overturn Roe v. Wade ends the federal protection of abortion rights. However, ending the federal protections doesn’t make abortion illegal.
2. States are in control: It allows states to decide whether to restrict, ban or protect abortion rights. For states that decide to ban abortion, they are restricting access to abortion within the state. Individuals can seek services in states that do not restrict access.
3. Eligibility of expenses is not impacted: Abortion and medical-related travel expenses are eligible medical expenses under the Internal Revenue Service Code, which makes it either tax-deductible or reimbursable under a Flexible Spending Account (FSA), Health Savings Account (HSA) and Health Reimbursement Account (HRA) (if permitted by the plan). The reversal of Roe v. Wade doesn’t affect the eligibility for these services. Further, a change to eligibility would require a separate federal legislative action from Congress to remove its eligibility.

Step 1: Confirm how your state is responding

States are now solely responsible for setting the laws regarding abortion. Approximately one-third of states have laws (or are expected to have laws) that actively protect the rights to abortion. Meanwhile, there are already seven states (Arkansas, Kentucky, Louisiana, Missouri, Oklahoma, South Dakota and Utah) that have eliminated (or nearly eliminated) access to abortion. The next 30 days are expected to be active as states refine their rules to ban, restrict or protect abortion rights.

Understanding state requirements is not always easy. Here are a few things to look for:

1. Are there restrictions on when abortions can occur? Some states may restrict abortion after a set time period in the pregnancy (i.e. after 15 weeks) and/or based on certain exceptions.
2. Are there waiting periods or counseling requirements? These may require an individual to make multiple visits and review information prior to a procedure.
3. Is parental consent or notification required for minors?
4. Are there coverage restrictions? Some state exchanges and state Medicaid programs already limit or do not offer coverage for abortion.

You may need to check with your state laws and insurance commissioners. Here is a state-by-state resource that may aid in your investigation.

Step 2: Understand your options

There are a variety of ways an employer may choose to respond to the reversal of Roe v. Wade. It is important to evaluate your specific situation and determine how that might influence any adjustments you make to your benefits.

Are you looking to assist employees with expenses resulting from the change? For individuals that may need to travel for a procedure, medical expenses may include the cost of transportation, meals and lodging if the principal reason for being there is to receive medical care. Employers may want to assist employees in covering travel-related expenses. There are a few alternatives that can be used:

• An integrated Health Reimbursement Account (HRA) may be used to provide employer funding on a tax-advantaged basis for eligible medical expenses. An integrated HRA can only be offered to employees enrolled in a group health plan coverage. The advantage of an integrated HRA is that employers can set the funding limits, but it can only be offered to those with group health plan coverage.
• An Excepted Benefit HRA is also an employer-funded account on a tax-advantaged basis for eligible medical expenses. However, an Excepted Benefit HRA can be offered to all employees (regardless of health plan coverage) up to $1,800 annually.
• A Specialty Account is a post-tax, employer-funded account designed to pay for specific items identified by the employer. As a post-tax account, there is increased flexibility in how the program is designed, who can receive the benefit and how much can be provided.

When considering any of these options, employers may restrict the types of expenses that are eligible. While plans can be designed to only pay abortion and abortion-related travel expenses, employers may want to provide a broader definition of eligible expenses in order to preserve privacy for employees.

What coverage is offered through your health plans? Health plan coverage is expected to be impacted as states begin to enforce laws or requirements that restrict access to abortion. If you have a narrow network or state-only coverage, your health plan coverage is likely to mirror the rules and laws of the state. For some employers, this means that abortion will not be a covered service in their health plan. Employers that want to ensure abortion is a covered service may need to consider adding access to a wider or national coverage network. Alternatively, employers could choose to reimburse employees for out-of-network expenses through the HRA options discussed previously.

What other benefits changes might need to be evaluated? In states where abortion services are banned or limited, employers may need to consider how this affects employees, their utilization of other benefits programs and other longer-term implications. Employers may want to review child-care or new parenting benefits, counseling services, adoption consultation programs or even financial planning services.

Step 3: Form a plan and communicate with employees

Employees are likely to be a bit anxious about what the reversal means. Regardless of the benefits decisions you make, it is important to provide clear and timely communication to employees. The future is uncertain, but communicating with employees now will help ensure they understand their options as things move forward.

Over the last few years, we have faced a pandemic, global unrest, a Great Resignation, the battle of remote v. in-person work, record levels of mental health concerns, and so much more.  We are resilient and will navigate this as well.

Becky Seefeldt is vice president of strategy at Benefit Resource LLC (BRI), a leading provider of dedicated pre-tax account administration and COBRA services nationwide.