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Businesses Face Uncertainty in Wake of SCOTUS Abortion Ruling

August 04, 2022

The Supreme Court’s decision to overturn the constitutional right to an abortion has created a nightmare scenario for many businesses that want to remain in compliance with the law while still providing the kind of medical care their employees demand.

In the wake of the court’s ruling, a litany of name-brand businesses – from Citigroup to Warner Bros. to Disney to Meta to Bank of America to Intuit to Dick’s Sporting Goods to Apple to Bumble to Levi Strauss to Nike to Yelp to Microsoft to Amazon to Glowforge – have announced they will offer travel benefits to employees who work in states where abortion services are no longer available.

These plans have been met with applause from the pro-choice crowd. But they’re fraught with risks – legal, reputational, and political.

Abortion Travel Benefits Depend on Company’s Insurance Coverage

The leaders of companies operating in multiple states have a particular interest in offering travel benefits for abortions so that they can ensure all of the employees under their insurance plan have the same access to services. 

However, rolling out such a benefit isn’t simple, depending on the kind of insurance plan a company employs. Self-insured companies have more latitude to decide what’s covered, while fully insured companies are confined to what their carrier will allow.

In states where insurance companies are forbidden from covering abortions, carriers might be barred from paying for abortion benefits.

In that case, businesses might consider relying on employee assistance programs to foot the bill for abortion travel or could roll out a separate reimbursement plan to cover the costs. However, reimbursement plans carry with them tax implications: travel reimbursement, generally, is considered taxable compensation.

Numerous legal Nuances in Abortion Travel Benefits

Employers need to be cautious when setting up travel benefits for abortions to make sure they don’t run afoul of the law – and the devil very much lurks in the details.

Consider, for example, in vitro fertilization (IVF) treatments, a service offered by some employer insurance plans. IVF clinics commonly fertilize multiple embryos for possible implantation, then discard them as the treatments proceed. Some health plans view these as “elective abortions” and do not cover them. Instead, they only cover “nonelective abortions,” in which the life of the mother is in peril. 

Employers need to be aware of nuances like this as well as the ongoing uncertainty surrounding abortifacients or drugs that cause abortions. Some states are starting to limit access to abortifacients, which could cause serious complications for employers that rely on insurance plans that utilize telehealth services.

But that’s one of the biggest problems at this point: the law remains unsettled in many areas. The situation is fluid, meaning companies will have to remain agile, likely for quite some time until specific issues can be litigated.

Could Companies Face Penalties for Travel Benefits?

Companies in some states could face civil or even criminal liability for offering abortion travel benefits.

States like Texas and Oklahoma, for example, have laws that allow private citizens to sue anyone who aids in an abortion, including by paying for or reimbursing the cost of an abortion through insurance coverage.

Private citizens who bring these lawsuits are eligible to collect money if they’re successful in court.

Justice Brett Kavanaugh wrote in his concurrence on the court’s ruling that a state may not bar its residents from going to another state to obtain an abortion – but for now that just provides legal support for employer-funded travel benefits.

In theory, there’s nothing stopping an aggressive prosecutor in a state banning abortion from trying to pursue criminal charges against a company that pays for abortion travel. In fact, a coworker who offers to drive a colleague to another state for an abortion could conceivably face criminal charges under the way some laws are written now.

Businesses Caught in the Middle on Abortion Travel Benefits

The issue of abortion is highly charged, and businesses that wade into it could face political and reputational blowback.

In July, the Texas Freedom Caucus of the state legislature sent law firm Sidley Austin a letter putting the firm “on notice” over its intention to reimburse employees who travel out of state to obtain an abortion. Texas Republicans sent a similar letter to rideshare company Lyft in May.

Many shareholders will be clamoring for their businesses to offer abortion travel benefits. And then again, many others will also be pressuring their companies not to. Employers need to carefully assess how offering these benefits will be perceived, in the communities where they’re based, among their clients and nationwide.

With social media, it doesn’t take much for a local business to be destroyed if it ends up on the wrong side of an internet horde, even if those critics have little actual, genuine interaction with the company.

Perhaps most chilling is the chance that businesses based in certain states could face retribution from governments for offering abortion travel benefits. Even before the Supreme Court’s ruling became official, the prosect of anti-abortion states penalizing businesses that offer travel benefits was being openly discussed in many corners, with a lot of uncertainty over what could reasonably be expected.

Minimal Guidance for Businesses on Abortion Benefits

Unsurprisingly, the initial reaction to the Supreme Court’s ruling has focused on equality and women’s rights. But overturning Roe could well have a tremendous impact on business as well.

The pressure might not all be on companies that choose to support employees’ decisions on their own reproductive care. Last week, Kansas voters soundly rejected a ballot measure that would have amended the state constitution to allow major restrictions on abortion rights and funding. Many political observers say the large margin of victory in such a deeply conservative state could portend badly for Republicans seeking to impose ever harsher abortion restrictions in their states.

And then there is this. A new survey conducted by LeanIn of over 3,000 working individuals with different political backgrounds showed that 76 percent of employees under the age of 40 prefer to work for a company that publicly supports access to reproductive care, while 78 percent said they believe their employer should take action to protect abortion access in response to the Supreme Court decision overturning Roe.

With so much still to be sorted out, the only sure thing is that the battle over abortion has definitely become a workplace issue that is not likely to be resolved anytime soon.

 --By SNCJ Correspondent Brian Joseph

 

State Abortion Laws Post-Dobbs

Sixteen states either already ban or restrict abortion, or will likely do so in the near future, as a result of the Supreme Court’s ruling in Dobbs v. Jackson Women’s Health Organization, according to The New York Times. Abortion bans have been blocked in another five states. Abortion is currently legal and will likely remain so in 20 states. In the other nine states, the legal status of abortion is yet to be determined by the courts or state lawmakers.

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