In the past few years, court cases and legislation have changed the rules regarding contraceptive coverage. Some state legislatures have enacted legislation that mandates insurance coverage of contraceptives. Other state laws require parity in contraceptive coverage, which means that employers who cover other types of prescription medications must also cover contraceptives. However, many of these state laws do not apply to large multi-state employers due to ERISA (Employee Retirement Income Security Act) laws. The following is a brief overview of some of the recent bills, states mandates and court cases.

Employers should be aware of the laws and policies regarding contraceptive coverage that operate in their state so that they may craft their health plan benefits appropriately.

State Laws
As of November 2004, 21 states require employers who provide prescription drug coverage in general to also provide coverage for prescription contraceptive methods and services.

See the Alan Guttmacher Institute for more details (PDF File). Other states have contraceptive equity bills pending (see them here).

Exemptions to State Laws
Self-insured companies are exempt from state laws. Some states also exempt religious organizations from covering contraception.

A 2004 study found that state mandates have increased the coverage of contraception in both states with mandates and for employees covered under nationally determined plans in states without mandates.⁷³ (Click here for more information on who covers contraception).

National Policy Developments
Since 1997, lawmakers have repeatedly introduced legislation in Congress to require insurance plans that provide coverage for prescription drugs and devices to cover all forms of prescription contraceptive methods and services. The Equity in Prescription Insurance and Contraceptive Coverage Act (EPICC PDF File) applies to both employer-purchased health insurance and self-insured plans. Unlike state laws, this bill would require self-insured employers who offer prescription drug coverage to add coverage for contraceptive methods and services. This legislation has not yet passed.

In 2000 the U.S. Equal Employment Opportunity Commission ruled that an employer’s failure to provide contraceptive coverage in a prescription drug plan constitutes gender discrimination under Title VII of the Civil Rights Act of 1964. This decision is not binding on any employer other than the employer to which the decision specifically applies. However, the decision gives grounds for others to mount legal challenges. (To read the decision, click here.)

Court Challenges
Employees have taken their employers to court over the issue of contraceptive coverage using similar grounds to the EEOC decision: arguing that providing prescription drug coverage and not covering contraception constitutes gender discrimination under Title VII of the Civil Rights Act of 1964. Erickson v. Bartell Drug Company was the first such court challenge. In this case, the Court ruled in favor of the plaintiff, concluding “that Bartell’s prescription drug plan discriminates against Bartell’s female employees by providing less complete coverage than that offered to male employees. Although the plan covers almost all drugs and devices used by men, the exclusion of prescription contraceptives creates a gaping hole in the coverage offered to female employees, leaving a fundamental and immediate healthcare need uncovered.”⁷⁴ Bartell was ordered to provide coverage of contraceptive methods to the same extent that it covers other drugs, devices and preventative care for employees.

Employers should be aware that this case sets a precedent for the future challenges.

Healthy People 2010 Advocates Contraceptive Coverage
Healthy People 2010 is a national public health initiative whose goals are to increase life expectancy, improve quality of life and eliminate health discrepancies between various segments of the population. The Department of Health and Human Services has partnered with Federal Agencies and over 400 national membership organizations to create guidelines that are intended to steer planning efforts by local communities to address preventable health issues. One of the goals of the Healthy People 2010 initiative specifically aims to “increase the proportion of health insurance policies that cover contraceptive supplies and services.”⁷⁵