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Contraception Controversy Can Employers Refuse to Pay for “The Pill”

September 29, 2000
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Related Topics: Discrimination and EEOC Compliance, Health and Wellness, Featured Article
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To fund or not to fund?

In July, Planned Parenthood brought a class-action federal lawsuit on behalfof women employees of Seattle-based Bartell Drugs, alleging that the company’sfailure to include female contraceptives in its employee prescription plan was aform of gender discrimination. The suit argued that the policy violated TitleVII of the Civil Rights Act because the decision not to cover contraceptives,including birth-control pills, disproportionately affects women. The case raisesimportant questions: Can a company choose to exclude a gender-specific productin its prescription plan? And what does this mean for the bill, stalled now inCongress for about four years, that would require all health plans that coverprescription drugs to cover contraceptives? (In 1998, it should be noted,Congress mandated that insurance plans cover contraceptives for federalemployees). Arthur F. Silbergeld, a partner in the labor and employment practicegroup of the Los Angeles-based firm Proskauer Rose, sheds some light on what itall means.

Let’s get a little background on this lawsuit.

This is a lawsuit that’s relatively unique in that it arises under TitleVII of the 1964 Civil Rights Act. It’s not an accommodation claim; it’s adirect claim of a discriminatory practice. It alleges that an employer, thedefendant, specifically has maintained an insurance plan that excludescontraceptives, but covers other prescription drugs, and that that exclusion issex discrimination under Title VII. According to the suit, it’s sexdiscrimination because the effect of the exclusion is felt only by females.Presumably if there were a male contraceptive that was available only byprescription, and it were excluded from coverage, this case would have noviability.

So what’s the main issue here?

In my view, the issue isn’t whether it’s fair or right as a matter ofsocial policy. The narrow question is whether or not it’s covered by TitleVII. Insurance typically is a matter of contract that’s regulated by statelaw. A number of states have already mandated coverage for prescriptioncontraceptives. Congress will occasionally intervene. For instance, Congresspassed a law called the Health Insurance Portability Protection Act a few yearsago. That act made it a matter of federal law that if an employee is covered byinsurance by Employer A and leaves to go to Employer B, Employer B’s carriercan’t rule out pre-existing conditions, which could discourage the individualfrom making the move. So the federal government has inserted itself from time totime in a non-ERISA context when policy has an effect on job mobility. But inthis case, I don’t think Congress would intervene on the basis of thatrationale. I don’t see Congress acting under federal law.

Is this the general trend with Congress?

Given the relatively conservative bent of Congress, it’s just not likelythat they’d act. And the U.S. Supreme Court as a matter of principle tends tosay that matters of state law should be left to the states. They’re likely tosay in ruling on a Title VII challenge that this is an insurance issue and not aTitle VII issue. Insurance issues are state law issues and should be left to thestates. And the fact that a number of states have addressed the issue isevidence enough that it’s a state law issue. Again I emphasize that whether it’sfair or politically correct is an entirely different issue, because as a matterof public policy, I think plans should provide contraceptives. But that’s nota legal perspective, that’s a political perspective. I think the issue of theavailability of contraceptives to women under plans will probably be addressedon a state-by-state basis.

So for this case to win...?

It would have to be under Title VII. They have to show that Title VII isdirected to the employer-employee relationship, and they are going to have toconvince the court that a benefit of employment is covered by Title VII. Andthat the benefit differentiates between members of one gender and the other. Andthe way they have to do that is to show the denial of a prescription medicationthat members of only one gender would use. Now if vasectomies, which are anelective procedure, were not covered presumably because they apply only tomales, a male could challenge the exclusion on the same basis, and I don’tbelieve there have been such challenges. I don’t think the fact that aparticular prescription is used predominantly or exclusively by members of onegender is enough to show discrimination under Title VII. That’s the burden ofproof: showing the exclusion of a medication that is statistically usedpredominantly or exclusively by members of one gender, and proving it’s abenefit of employment, and therefore part of the employer-employee relationshipand that it violates Title VII. I just think it’s an uphill battle.

What will Bartell’s argument be?

Bartell’s argument will be that insurance is a matter of contract. Thatthey (Bartell Drugs) are free to decide based on cost considerations alone whatpackage of benefits their policies will and will not provide, and that they havenot selected contraceptives for exclusion because of any intent to discriminateagainst their female employees, but simply because of cost considerations. Ofcourse they’re going to argue the coverage issue in the first place, thatTitle VII was never intended to cover specific benefits under a group healthplan.

Is the case different because this is pregnancy rather than treatment for afemale-specific disease?

I think the fact that it’s elective rather than essential to health makesit more difficult for Planned Parenthood. I don’t know whether this plansexcludes birth-control pills prescribed for non-contraceptive reasons. If itdoes, it would enhance Bartell Drugs’ position.

What does all this mean for employers?

There may be some prospect of prevailing, but I’d regard this as a highlyremote outcome. I think the issue would need to be addressed by legislation. Myperspective is that our nation has made a very smart and necessary choice byencouraging women to enter the workforce. We live in a society that’s highlycompetitive and we can’t ignore 50 percent of the brainpower. If you’regoing to bring in 50 percent of the brainpower to the workforce, you’ve got toprovide whatever benefits are necessary in order to keep that portion of theworkforce happy and healthy. You bear the cost of it. It may not be covered byTitle VII, it may not be this avenue of law that brings this particular benefitinto general availability, but I think that ultimately it will be available.

Workforce, October 2000, Vol. 79, No. 10, pp.120-121 -- Subscribenow! The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion.

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