Murphy administration proposes abortion coverage mandate in some health plans

The state Department of Banking and Insurance has proposed a new regulation that would require health insurance plans overseen by the state to cover abortions, according to a report the department sent to Gov. Phil Murphy and legislative leaders.

The proposed abortion coverage mandate, which comes six months after the U.S. Supreme Court allowed states to ban the procedure, is necessary to avoid confusion among consumers who don’t know what their plan covers, align with medical experts’ opinion that abortion is essential to reproductive health, and remove the cost barrier for residents who can’t afford to pay for an abortion otherwise, the report says.

Murphy, a Democrat, signed legislation in January empowering the Department of Banking and Insurance to set up regulations mandating abortion coverage, but only if a study by the department found it necessary. Marlene Caride, the banking and insurance commissioner, sent the long-awaited 11-page report to Murphy and lawmakers the day before Thanksgiving.

“State law protects the right to terminate a pregnancy without government interference,” the report says. “Therefore, abortion is part of comprehensive insurance coverage for reproductive care and should reasonably be included in the range of services (covered) by health insurance.”

New Jersey would be the eighth state to require abortion coverage in private health insurance plans.

The news was first reported by Politico New Jersey.

The new regulation would not affect all plans. New Jersey holds regulatory authority only over certain health insurance markets, including state Medicaid and individual, small employer, and large employer markets. The New Jersey Association of Health Plans says less than 20% of residents are covered under state-regulated commercial health plans.

Almost one million women in the United States have an abortion annually, according to the Guttmacher Institute, a pro-abortion rights research group. In 2017, the last year for which data is available, 48,110 abortions were performed in New Jersey, the group says.

Sen. Teresa Ruiz (D-Essex) said the mandate would “help to reduce the financial barriers to accessing reproductive care for many around the state.”

“The ongoing reality of a post-Roe world will continue to challenge us to look for new ways to expand access, and ensuring insurance coverage is one way we can ease the burden on individuals and providers,” Ruiz said.

Spokespeople for Murphy and Assembly Speaker Craig Coughlin did not respond to requests for comment.

Marie Tasy, executive director of New Jersey Right to Life, called it “disgraceful” that New Jersey wants to join the few states mandating abortion coverage, and said she fears this will encourage more women to seek the procedure.

“It’s very, very sickening. Women and children are going to be the ones who suffer,” Tasy said.

The report says mandating carriers to cover abortions would likely not raise premiums “in any material way,” citing costs saved from not paying claims for prenatal and postnatal care and childbirth. Insurance carriers told the Department of Banking and Insurance the range of impact to premiums was between zero to 0.1%, the report says.

Before issuing the report, the Department of Banking and Insurance collected public input, calculated financial impacts, and analyzed how access to comprehensive abortion care can affect the lives of women seeking abortions.

The report says the regulation would bring needed consistency to the individual, small employer, and large employer insurance markets. Carriers now have the option to cover all abortions, or to restrict coverage to cases of rape or incest, or to protect the life of the mother. It’s not always clear to consumers what their plan includes, the report says.

Mandating abortion coverage would also remove the barrier to access for women who can’t afford to pay for the entire procedure, the report says.

In 2020, the median patient charge for the cost of a medication abortion was $560, and $575 for an abortion performed via surgical procedure during the first trimester, the report says. The cost rose to $895 for a third-trimester procedural abortion.

The report says people who want abortions and can’t get one are more likely to raise children alone, live in households below the poverty level, and struggle to pay for food, housing, and transportation.

Murphy and abortion rights advocates have sought to eliminate out-of-pocket costs for abortions, but the proposed regulation would not do that. It would include an exemption for religious employers.

Of the seven states that now require abortion coverage in private health insurance plans, five require coverage with no copayments.

Brittany Holom-Trundy, senior policy analyst at left-leaning think tank New Jersey Policy Perspective, called the proposed regulation a “really good first step to identify why it’s urgent to mandate abortion coverage,” but urged lawmakers and the Murphy administration to cover all costs for patients.

“Whether it’s covered or not, people who need it are going to seek out the health care that they need,” she said. “There are still people falling through the gaps, so we still have some bits missing here.”