Some big employers restrict abortion coverage

About a quarter of large U.S. employers heavily restrict coverage of legal abortions or don't cover them at all under health plans for their workers, according to the latest employer health benefits survey by KFF.

The findings demonstrate another realm, beyond state laws, in which access to abortion care varies widely across America since the Supreme Court overturned the constitutional right to abortion last year in Dobbs v. Jackson Women's Health Organization.

More than ever, where someone works and the constraints of their health insurance can determine whether an abortion is possible. Workers without coverage are left to pay out-of-pocket for abortion care and related costs.

In 2021, the median costs for people paying out-of-pocket in the first trimester were $568 for a medication abortion and $625 for an abortion procedure, according to a report from Advancing New Standards in Reproductive Health at the University of California, San Francisco. By the second trimester, the cost increased to $775 for abortion procedures.

KFF's 2023 annual survey found that 10% of large employers — defined as those with at least 200 workers — don't cover legal abortion care under their largest job-based health plan. An additional 18% said legal abortions are covered only in limited circumstances, such as when a pregnancy is the result of rape or incest, or endangers a person's life or health.

The share of employers that said they don't cover abortion under any circumstances "is bigger than I would have expected," said Matthew Rae, an associate director at KFF who helped conduct the survey. So far, 14 states, mostly in the South and Midwest, have enacted near-total abortion bans, and an additional seven states have instituted gestational limits between six and 18 weeks. Abortion is legal in 24 states and the District of Columbia.

Sharply divergent state abortion laws solidified in the aftermath of the Dobbs decision compound the complexity for employers with workers across multiple states, Rae said. Many large companies employ people in places with vastly different abortion policies, and their health benefits are more likely to cover dependents who may live elsewhere.

"Those dependents can be college kids — and college kids can be anywhere — or any other type of dependent who could just spread out over an area much larger than where you just have actual physical establishments," Rae said.

The KFF survey found that about a third of large companies said they cover legal abortions in most or all circumstances; the largest companies, with at least 5,000 employees, were more likely to offer the benefit compared with smaller firms. An additional 40% said they were unsure of their coverage — perhaps because employer policies are in flux, Rae said.

Employer health plans' treatment of abortion has changed little since the Dobbs decision, the survey found. Among companies that said they did not cover legally provided abortion services or covered them in limited circumstances, 3% reduced or eliminated abortion coverage. By contrast, of the large companies that generally covered abortion, 12% added or significantly expanded coverage.

That's in sharp contrast to the rapidly changing laws governing abortion access in the states. It's unclear whether workers at companies that don't cover abortion or heavily restrict coverage are located primarily in states that have outlawed the procedure.

The KFF survey includes information from more than 2,100 large and small companies on their health benefits and the related costs for workers. Annual premiums for family coverage rose 7% on average this year, to $23,968, with employees on average contributing $6,575 toward that cost. The jump in premiums represents a notable increase compared with that of the previous year, when there was virtually no growth in those costs. Average yearly deductibles for workers were $1,735 for single coverage, a cost that was relatively unchanged.

One tactic employers use is to provide separate benefits for abortion-related expenses. In response to increasingly restrictive state abortion laws and the Supreme Court's decision, large companies — such as Amazon, Starbucks, Disney, Meta, and JPMorgan Chase, among others — announced they would pay for employees' abortion-related travel expenses.

However, the KFF survey found that a small share of large employers said they provide or plan to provide workers with financial help to cover abortion-related travel expenses.Companies with at least 5,000 workers are the most likely to provide that assistance. Overall, 7% of large employers said they provide or plan to provide financial assistance to employees who must travel out of state for abortion care.

According to the Brigid Alliance, a New York-based nonprofit that helps people with logistics and defrays abortion-related costs, average travel costs now exceed $2,300. As restrictive laws proliferate, distances traveled have also increased since the Dobbs ruling, with each person on average traveling roughly 1,300 miles round trip in the first half of 2023.