Commissioner’s Bulletin enshrines insurance companies’ obligations to cover abortion and abortion-related services under existing and soon-to-be effective state statutes

July 25, 2022 - LOS ANGELES — As part of his ongoing effort to protect access to reproductive health care services and abortion coverage in California, Insurance Commissioner Ricardo Lara last week issued a Bulletin to remind insurers of their current obligations to cover abortion care and abortion-related services, and to alert insurers to both recent and soon-to-be-enacted changes in California state law.

“Defending all people’s right to health care, including the right to reproductive freedom, is a top priority for me and the California Department of Insurance,” said Commissioner Lara. “I want to make sure consumers and insurers have accurate information relating to abortion coverage and access in California and know that the Department of Insurance is there to protect consumers’ access to reproductive health services.”

California law is clear that abortion care is basic health care and covered by most health insurance. Commissioner Lara’s Bulletin explains that new and existing laws mandate insurance companies provide this coverage in three key areas:

• Abortion coverage is a medically necessary basic health care service: Health insurance policies that cover basic health care services must cover medication abortion when dispensed by a provider and surgical abortion. As of July 1, 2022, large group health insurance policies now have to cover basic health care services pursuant to Senate Bill 280 (Limón, Chapter 636, Statutes of 2021), a measure that Commissioner Lara sponsored last year.
• Medication abortion dispensed by pharmacies is medically necessary: Pursuant to Insurance Code section 10123.201, health insurance policies that cover outpatient prescription drugs must cover medically necessary prescription drugs, including abortifacient prescription drugs intended to induce an abortion when dispensed by a pharmacy. 
• Patient cost sharing and treatment limitations for abortion services will be illegal in new year: Beginning January 1, 2023, Senate Bill 245 (Gonzalez, Chapter 11, Statutes of 2022), will prohibit the imposition of any patient cost-sharing requirement on any abortion or abortion-related service covered by a health insurer. In addition, health insurers are prohibited from imposing utilization management on abortion and related services. SB 245 applies to both medication and surgical abortion. Commissioner Lara supported this measure in the legislative process.

“I was proud to partner with Insurance Commissioner Lara last year to ensure all health insurance policies in California cover reproductive services,” said Senator Monique Limón, who authored SB 280, which now requires large group policies to cover basic health care services including abortion. “Now more than ever it is important to protect all Californian’s access to affordable and accessible reproductive care.”

“The recent decision by the U.S. Supreme Court to take away the constitutional right to abortion after nearly 50 years of settled law is a devastating blow to reproductive freedom in our country,” said Senator Lena Gonzalez, who authored SB 245. “It is truly saddening to witness us move backwards as a nation, but in California, we will keep fighting. That is why I am so proud that my bill, the Abortion Accessibility Act (SB 245), is now law and will be implemented by all state-licensed health care service plans and disability insurance policies to ensure access to legal, affordable abortion care. I pledge to continue the fight and engage in further dialogue with stakeholders, partners, and community members to protect the reproductive rights of all Californians.”

Commissioner Lara encourages all insurers who issue or administer health insurance policies, except for specialized health insurance policies, to come into compliance with the new SB 245 statute before the start of the new year. He also encourages insurers to start making any necessary policy form filings with the Department to speed implementation. The Department will rigorously enforce this statute immediately upon its effective date, which is upon issuance or renewal of policies on or after January 1, 2023.

Notes:

• Bulletin: Coverage for Abortion and Abortion-Related Health Care Services
• The Department FAQ about insurance coverage for abortion is available on our website.
  Source: CA. Dept. of Insurance