New York (CNN Business)The corporate rush to pay for employee’s abortion-related travel costs in the wake of the Supreme Court’s decision allowing states to prohibit or severely limit abortion has raised a major concern: will your boss be able to find out when you make use of the benefit?
The most likely answer is not, particularly if the reimbursement is managed by the business’s healthcare insurance policy Benefits experts say.
“Just like your employer doesn’t know if you are going to the doctor for treatment of any other medical condition, they wouldn’t be able to find out that you’ve been reimbursed for travel to seek an abortion in a state where it’s legal,” said Harvey Cotton, who advises employers on benefits administration as a principal of Ropes & Gray law firm. “That’s why having this benefit work through the medical plan is so important.”
The Health Insurance Portability and Accountability Act of 1996, commonly referred to as HIPAA ensures the privacy of medical activities, whether it’s treatment or travel, Cotton stated.
Match, a dating app Match for instance provides a travel reward for women’s reproductive health that might not be accessible in the state where an employee is. It is managed by the health insurance plans it offers, which, according to the company, are confidential.
“Match Group’s reproductive benefits are structured through third parties to ensure privacy and confidentiality for employees,” it stated in a fact sheet noting that care or support services that the employee needs are not provided to the business.
Also, Yelp which is a review by the public platform has announced that it would not be able to see employees’ reimbursement for travel related to abortion documents.
“The privacy of our employees was critical to how we would introduce this benefit, which as noted above is administered through our health insurance provider, further ensuring confidentiality,” spokespersons said to CNN via email. “Yelp will never receive any information on who incurred a claim and/or received reimbursement.”
There are other options to establish the travel benefits. One particular option — a tax-deductible reimbursement program may create issues regarding how employers confirm the expense while protecting the privacy of their employees.
In addition, providing reimbursement for travel
A host of big employers recently announced that they will pay for employees to travel to clinics in which abortion is legal.
A procedure-based abortion during the first trimester is typically priced at $575 by 2020, as per an analysis conducted by researchers from the University of California San Francisco. But pregnant women in states where abortions are or will soon be prohibited might have to shell out hundreds or even thousands of dollars, to travel to states that allow abortions.
Alongside Match (MTCH) as well as Yelp (YELP) The list of companies that cover the cost of travel for abortions comprises Microsoft (MSFT), Kroger (KR), Starbucks (SBUX), JPMorgan Chase (JPM), Netflix (NFLX) and Levi Strauss (LEVI), in addition to others.
A little more than 11% of companies are currently implementing accommodations and travel benefits to abortions. Another 23% are thinking of making the move due to changes to the state’s laws that are in a process according to a Mercer survey that was in process since June 1st.
Larger companies tend to provide this benefit due to the fact that they are self-insured. This means they pay their employees their claims and employ an outside administrator, usually the insurer to run the health insurance plan. The self-insured plan is subject to Federal regulations and does not have to limit abortion coverage. However, a lot of smaller and mid-sized businesses have fully-insured plans which are subject to oversight by the state and will have a tough to provide abortion-related benefits or reimbursement for travel expenses in states where abortion is not permitted.
What is the best way to make the reimbursement plan be implemented?
There are a variety of ways that companies could set up such programs, but the most popular is likely to be by way of current health insurance programs. Certain employers have already covered employees traveling expenses when they require certain medical services for surgery for the heart, orthopedics, or treatment for cancer.
Insurance companies typically have or make forms and processes which allow employees to request reimbursement for expenses for lodging, travel, and other expenses covered to having an abortion, and submit receipts. It may be similar to the method patients submit claims from out-of-network doctors and then receive reimbursement by the insurer, according to Julie Campbell, principal in the health and benefits department at Mercer.
Some businesses are looking at establishing programs of reimbursement in the coming months or even weeks experts suggest.
Another way employers can help cover travel expenses is through health reimbursement plans, also known as HRAs, or through employee assistance programs, also known as EAPs, or even a taxable reimbursement.
For instance, employers could opt for HRAs when the insurance company they deal with is unable to add an annual reimbursement program or they could opt for EAPs for those who want to cover a larger variety of employees and not just those who are covered by the health insurance plan of the company, according to Jonathan Zimmerman, a partner at Morgan Lewis and a co-leader of the company’s task team.
Both of these choices can be subject to HIPAA privacy regulations, but they are more difficult to establish and have greater limitations. For example, the maximum amount of reimbursement for HRAs this year is $1,800. HRA in the current year will be $1,800. Additionally, not all of the HRA providers and EAPs are able or willing to swiftly establish reimbursement for travel related to abortion.
The benefit is provided in the form of a tax-deductible reimbursement however, it can be more difficult for organizations to handle, dependent on the way it’s implemented. It might not be covered by HIPAA. The companies will have to consider balancing the need to prove the travel claims of employees and the desire to be in the privacy of their own homes.
What to be aware of
Anyone who wants to use their travel benefit at work must read the small print before they decide to assume all expenses will be covered.
The women may need to meet their deductibles before they are able to receive reimbursement for expenses for travel, especially when they’re on medical insurance with high deductibles.
Certain businesses may also stipulate that the travel benefits are only available to women who are unable to access abortion services within 50-100 miles of their residence. Some companies might require employees to visit the closest state for medical attention, while some could allow employees to travel to the places they’re able to find appointments the fastest.
Additionally, although companies are able to reimburse reasonable travel expenses without tax implications, however, the IRS restricts hotel expenses to $50 per night for patients and another $50 for the companion, if required with a total of $100 per night. Therefore, some employers might limit their reimbursement for lodging in order to avoid tax burdens.
For those who travel to other states, companies could request receipts for gas, or pay them with a flat fee that is 22 cents for each mile which is the rate 2022 established by the IRS.
They will also have to determine if the outside-of-state providers they encounter will be considered in-network, or out-of-network. This could be much more costly.
However, some employees might still be struggling to cover the expense of traveling out of state to get the procedure, as they will not be reimbursed for weeks. This is particularly the case for those who earn low wages.
“A reimbursement mechanism is only going to work for people who can come up with that money,” said Alina Salganicoff who is the director of women’s health policy at Kaiser Family Foundation. “If you don’t have a credit card if you don’t have that kind of money saved up, for your employer to say ‘We’ll pay you back for that,’ you have to borrow money somewhere to get that money to do that.”
Can states get involved?
What is not yet known is whether the state’s police officers could be able to receive claims related to travel and abortion services when a state passes legislation to limit the services their residents are able to access beyond their boundaries.
There are some exceptions to HIPAA that pertain to law enforcement agencies that permit state agencies to access health records, said Tzvia Feiertag, who is a member of the practice group for employee benefits within the Epstein Becker & Green law firm.
However, other states in which abortion is legal are introducing laws to limit access to information about medical conditions and to prevent police and courts from working on cases relating to abortions that are within their border.
Additionally, The US Department of Health and Human Services Office for Civil Rights released guidance last week that stated that protected health information can be disclosed to the police and without patient permission “only in narrow circumstances tailored to protect the individual’s privacy and support their access to health care, including abortion care.”
“So much of it is unknown at this point in time, and it varies from state to state,” said Katharine Marshall, a principal in the group of law and policy at Mercer Benefits Consulting firm.
