Legal clashes await US companies to cover workers’ abortion costs

June 26 (Reuters) – A growing number of major US companies have said they will cover travel costs for employees who have to leave their countries of origin to have abortions, but these new policies could expose companies to lawsuits and even possible criminal liability, according to legal experts. †

Amazon.com Inc (AMZN.O), Apple Inc (AAPL.O), Lyft Inc (LYFT.O), Microsoft Corp (MSFT.O) and JPMorgan Chase & Co (JPM.N) were among the companies announcing plans to offer those benefits through their health insurance plans pending Friday’s U.S. Supreme Court ruling overturning the landmark 1973 Roe v. Wade ruling that had legalized abortion nationwide. read more

Within an hour of the decision being announced, Roger Lynch, CEO of Conde Nast, sent a memo to staff announcing a travel reimbursement policy and calling the court’s ruling “a crushing blow to reproductive rights.” Walt Disney Co (DIS.N) unveiled a similar policy Friday, telling employees it recognizes the impact of the abortion ruling but remains committed to providing comprehensive access to quality health care, a spokesperson said. read more

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Companies including health insurance company Cigna Corp (CI.N), Paypal Holdings Inc (PYPL.O), Alaska Airlines Inc [RIC:RIC:ALKAIR.UL] and Dick’s Sporting Goods Inc (DKS.N) also announced the refund policy on Friday.

Abortion restrictions already on the books in 13 states went into effect as a result of Friday’s ruling and at least a dozen other Republican-led states are expected to ban abortions.

The court’s decision, prompted by the conservative majority, upheld a law in Mississippi that prohibits abortion after 15 weeks. Meanwhile, some Democrat-led states are moving to bolster access to abortion.

Companies will have to navigate that patchwork of state laws and will likely spark the ire of anti-abortion groups and Republican-led states if they adopt policies that support workers undergoing abortions.

State lawmakers in Texas have already threatened Citigroup Inc (CN) and Lyft, which had previously announced travel reimbursement policies, with legal consequences. A group of Republican lawmakers wrote in a letter to Lyft chief executive Logan Green last month that Texas will “take swift and decisive action” if the ride-hailing company implements the policy.

Lawmakers have also outlined a series of abortion-related proposals, including a bill that would prohibit companies from doing business in Texas if they pay residents of the state to have abortions elsewhere.

LAW CASES RISE

According to Robin Fretwell Wilson, a law professor at the University of Illinois, it’s probably only a matter of time before companies face lawsuits from states or anti-abortion activists who argue that payments related to abortion violate state prohibitions on facilitating or helping and encouraging abortions. and health law expert.

“If you can sue me as a person for carrying your daughter across state lines, you can sue Amazon for paying for it,” Wilson said.

Amazon, Citigroup, Lyft, Conde Nast and several other companies that have announced refund policies have not responded to requests for comment.

For many large companies that fund their own health plans, the federal law regulating employee benefits will provide crucial coverage in civil lawsuits over their reimbursement policies, several attorneys and other legal experts said.

The Employee Retirement Income Security Act of 1974 (ERISA) prohibits states from enacting requirements “related to” employer-sponsored health plans. Courts have interpreted that language for decades to ban state laws that dictate what health plans can and cannot cover.

ERISA arranges benefit plans that are funded directly by employers, also known as self-insured plans. According to the Kaiser Family Foundation, by 2021, 64% of U.S. employees with employer-sponsored health insurance were covered by self-insured plans.

Any company sued over an abortion travel reimbursement claim will likely cite ERISA as its defense, according to Katy Johnson, senior health policy adviser at the American Benefits Council, a trade group. And that will be a strong argument, she said, especially for companies with general reimbursement policies for necessary medical travel rather than for companies that exclude abortion.

Johnson said reimbursements for other types of medically-related travel, such as visits to hospitals designated as “centers of excellence,” are already common, although policies related to abortion are still relatively rare.

“While this may seem new, it’s not in a general sense and the law is already telling us how to handle it,” Johnson said.

LIMITS

The argument has its limits. Fully insured health plans, where employers purchase coverage through a commercial insurer, cover about a third of employees with insurance and are regulated by state law and not ERISA.

Most small and medium-sized US businesses have fully insured plans and cannot claim that ERISA prevents states from limiting abortion coverage.

And ERISA cannot prevent states from enforcing criminal laws, such as those in several states that make it a crime to aid and encourage abortion, so employers who adopt reimbursement policies are vulnerable to criminal charges from state and local prosecutors.

But since most criminal abortion laws haven’t been enforced in decades since Roe was passed, it’s unclear whether officials would attempt to sue companies, according to Danita Merlau, a Chicago-based attorney who advises companies on benefit issues.

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Reporting by Daniel Wiessner in Albany, New York, editing by Alexia Garamfalvi and Grant McCool

Our Standards: The Thomson Reuters Trust Principles.

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