The Kaiser Study

"Women have much at stake in the ongoing national debate on health reform," states a new brief by KFF, which continues:

Comprehensive coverage and the scope of benefits are at the heart of making health care accessible to women. The decisions that policy makers enact regarding access and coverage of abortion are sure to be the subject of tremendous discussion and debate, and could affect care for millions of women today and in the future.

The KFF brief compares the bill passed 10 days ago by the House of Representatives with those still working their way through the Senate.  (It was written prior to release today of the omnibus Senate bill by Majority Leader Harry Reid.)

"The way that the final House bill addresses abortion coverage has
the potential to affect many women," notes KFF, underscoring the incorrect ways in which the media has portrayed this issue. 

"[A]bortion is one of the most common surgical procedures performed on women. In 2005, there were more than 1.2 million abortions in the United States. It is estimated that at current rates, about a third of women will have had an abortion by age 45." 

The Kaiser brief first reviews current law, noting:

• Current federal law bans the use of any federal funds for abortion, except in the event of rape, incest, or the woman’s life endangerment, as specified in the federal Hyde Amendment, which has been in effect since 1977.

• This amendment is not a permanent law but is attached annually to Congressional appropriations bills, and has been approved every year by the Congress.
• The broadest reach of the Hyde Amendment is on Medicaid, basically limiting federal Medicaid funding for abortions to life endangerment, rape, or incest cases in most states. States can choose to broaden the circumstances to cover other “medically necessary” abortions for women on Medicaid with their own funds and 17 states do, but in the majority of states women on Medicaid only have coverage in cases of rape, incest, or when the pregnancy is documented by a physician to be a threat to the life of the woman. Over the years, the Hyde Amendment has been broadened to limit federal funds for abortion for federal employees, in the Indian Health Service, and women in the military.

The House bill expands coverage to many of the nation’s uninsured by extending Medicaid eligibility to all qualifying individuals with incomes up to 150% of the federal poverty level and establishing a national health insurance exchange--a sort of marketplace where individuals with incomes above 150% of poverty can purchase insurance coverage. Initially, the Exchange would be open to all qualifying people who are uninsured and employees of some small businesses, with the possibility of opening it to more people over time. It would offer multiple insurance plans from which individuals can choose including at least one publicly financed plan as well as several privately operated plans. To help individuals purchase insurance, the federal government will provide subsidies (in the form of premium credits) to eligible individuals and families with incomes between 150% and 400% above the poverty level.

The House bill also extends premium credits to individuals with employer-sponsored insurance if their share of premiums exceeds 12% of their income, which could make an additional 1 million people eligible for purchasing coverage in the Exchange.

"In total," notes Kaiser, "it is estimated that 86% of participants in the Exchange would receive subsidies."

Kaiser notes:

The House bill places a number of restrictions on coverage of abortion, with the most direct impact on the plans that will be offered in the new Health Insurance Exchange. According to the legislation, the public plan within the Exchange would be prohibited from providing coverage for abortions beyond those permitted by current federal law (to save the life of the woman or in cases of rape or incest). The House bill also prohibits federal premium credits that low-income individuals will receive from the federal government from being used to purchase a health plan in the Exchange that includes coverage for all but federally permitted abortions. Although it is not required, private insurers may opt to offer a plan in the Exchange that covers abortions beyond those permitted by federal law. These insurers, however, will be required to also offer an identical plan that does not cover abortions for which federal funding is prohibited.

Private plans participating in the Exchange may choose to offer
supplemental coverage for abortions in the form of riders that are totally
separate from other benefits, but that coverage must be paid for entirely with non-federal funds. Furthermore, the plans must be separately operated to assure that federal funds are not used to administer or operate plans that cover abortions.

According to Kaiser, an estimated 12.4 million women ages 15 to 44 are uninsured, 94% of whom would qualify for federal assistance (61% through Medicaid—7.5 million women; and 33% for federal
premium credits subsidies to purchase coverage—4.1 million women).

Impact of the House Bill:

Kaiser states that provisions in the House bill would "have direct effects on women seeking coverage in the Exchange as well as on plans that
offer coverage in the Exchange."

• Women who choose the public option would not have abortion coverage nor would they have access to a rider.
• Women who receive any level of federal subsidy cannot purchase coverage from a plan that offers abortion coverage, but they do have the option of purchasing a separate rider for abortion coverage alone, if offered by the plan.
• Women who do not receive federal subsidies and seek coverage in the Exchange could be able to buy coverage from a plan that offers an abortion benefit, if such a plan is available.

Kaiser underscores what others have also noted:

It is unclear whether a woman would necessarily seek or know to buy a service-specific rider for abortion when she is choosing her insurance plan, or whether women without subsidies would necessarily know whether they are buying coverage from a plan that covers abortion or not. It is also unknown what the price differential would be between the two plans and how much the rider would cost, if offered. The House bill goes beyond the Senate committee bills by requiring the sale of a distinct insurance product that is designed specifically for those receiving subsidized coverage. For insurers, the House bill sets a number of restrictions, particularly the requirement to isolate federal dollars from private funds because a plan that receives any federal funds cannot provide abortion coverage. Although it is hard to predict the response of insurance plans to this type of law, some legal scholars contend that given the size of the potential pool of women and their families that will be eligible for federal subsidies under the exchange and other complexities, this might limit he development of insurance plans that offer either abortion coverage or a rider, and ultimately carry over to products offered in the employer market.

Many women who now have coverage for abortion care would lose it.

This complex combination of restrictions means that many women who will obtain coverage under health reform either through Medicaid or the Exchange would have to pay for an abortion out-of-pocket, the cost of which varies depending on factors such as location, facility, timing, and type of procedure.

A clinic-based abortion at 10 weeks’ gestation is estimated to cost between $400 and $550, whereas an abortion at 20-21 weeks’ gestation is estimated to cost $1,250-$1,800. The vast majority of abortions are performed early in pregnancy. In 2004, 89% were in the first twelve weeks of pregnancy and only 1% were at 21 weeks or later.  In general, abortions performed in hospitals are more expensive than those performed at clinics.

The House bill dramatically expands the Medicaid program, and extends insurance to qualifying uninsured individuals with incomes below 150% of the federal poverty line.

"The Medicaid program already serves millions of low-income women," notes Kaiser, "and is a major financier of reproductive health services. It is estimated that two-thirds of adult women on Medicaid are in their reproductive years."  In 33 states and the District of Columbia, state Medicaid programs do not pay for any abortions beyond the Hyde restrictions.  In these states, an estimated 4.5 million women ages 15-44 are currently uninsured and also have incomes less than 150% of the
federal poverty level.  Many of these women would likely qualify for Medicaid under the new House bill.

They will be forced to pay for their insurance with their rights.

The George Washington University (GWU) Study

This study, conducted by the George Washington University School of Public Health, focused on the implications of the Stupak Amendment for the health benefits industry on the whole; the growth of the public market for supplemental coverage: and the implications for covering abortions that are a consequence of an unexpected condition.

The study concludes that:

• The treatment exclusions required under the Stupak/Pitts Amendment will have an industry-wide effect, eliminating coverage of medically indicated abortions over time for all women, not only those whose coverage is derived through a health insurance exchange. [emphasis added]. 

Stupak-Pitts, according to the authors:

Can be expected to move the industry away from current norms of coverage for medically indicated abortions. In combination with the Hyde Amendment, Stupak/Pitts will impose a coverage exclusion for medically indicated abortions on such a widespread basis that the health benefit services industry can be expected to recalibrate product design downward across the board in order to accommodate the exclusion in selected markets.

• The Amendment will inhibit development of a supplemental coverage market for medically indicated abortions. 

In any supplemental coverage arrangement, it is essential that the supplemental coverage be administered in conjunction with basic coverage. This intertwined administration approach is barred under Stupak/Pitts because of the prohibition against financial comingling. This bar is in addition to the challenges inherent in administering any supplemental policy. These challenges would be magnified in the case of medically indicated abortions because, given the relatively low number of medically indicated abortions, the coverage supplement would apply to only a handful of procedures for a handful of conditions. Furthermore, the House legislation contains no direct economic incentive to create such a market [and would leave in doubt] states’ ability to offer supplemental Medicaid coverage to
women insured through a subsidized exchange plan.  

• "Spillover" effects as a result of administration of Stupak/Pitts will result in dramatically reduced coverage for potentially catastrophic conditions.

The authors write: "The administration of any coverage exclusion raises a risk that, in applying the exclusion, a plan administrator will deny coverage not only for the excluded treatment but also for related treatments that are intertwined with the exclusion."

The risk of such improper denials in high risk and costly cases is great in the case of the Stupak/Pitts Amendment, which, like the Hyde Amendment, distinguishes between life-threatening physical conditions and conditions in which health is threatened. Unlike Medicaid agencies, however, the private health benefit services industry has no experience with this distinction. The danger is around coverage denials in cases in which an abortion is the result of a serious health condition rather than the direct presenting treatment.

Noting that the entire industry may be pushed toward using life-threatening conditions as "the standard," the authors note that "it is likely that all women will risk coverage denials, regardless of the market in which their coverage is obtained," and will lose coverage for medically indicated abortions that may well threaten both health and ultimately life.

Under these circumstances, what is the norm today in the employer-sponsored market – broad coverage of medically indicated abortions – is likely to narrow considerably as the industry seeks to restructure its product design to meet the most restrictive demands. If this consequence flows, then the industry, confronting the challenges of distinguishing between enrollees for a handful of covered procedures and specific conditions, can be expected simply to eliminate certain procedures and conditions from coverage altogether, leaving women and families exposed.

"Stupak/Pitts and Hyde...presume that abortion is the immediate subject of the claim for coverage," note the authors. 

But this is not always the case.

High risk pregnancies themselves could be identified as potentially
abortion-related.

Conditions such as diabetes (observed in 1% of pregnancies) which are poorly controlled can lead to serious health consequences for both the woman and the fetus, including major congenital abnormalities, and a higher risk of spontaneous loss, which might in turn trigger an abortion if the pregnancy cannot be saved. Management of recurrent pregnancy loss or complicated multi-fetal pregnancies (increasingly prevalent with widespread use of assisted reproductive technologies) may also be considered abortion-related conditions. Similarly, uncontrolled hypertension, trauma during pregnancy, seizure disorders and other conditions, all require complex management and may persist beyond the pregnancy, and may result in abortion-related care. These concerns have increasing individual and public health consequence as age at pregnancy, body mass index and associated metabolic and cardiovascular abnormalities, Cesarean section rates, multi-fetal pregnancy rates, and use of assisted reproductive technologies have all increased dramatically in recent years.

Additionally, state the authors, "in response to more limited access to abortion services, there may be an increase in self-induced abortion, potentially through increased self-administration of misoprostol. Coverage for treatment of complications such as hemorrhage and incomplete abortion in such cases could be denied."

In these circumstances, how are plan administrators to distinguish between the abortion procedure and the rest of the treatment? Will the entire cost of a course of treatment (e.g., surgery to repair a damaged pelvis following an automobile accident) be denied if violation for paying for the excluded abortions, may elect to deny the treatment altogether, claiming that it is all related to the excluded treatment.

"As the denial is appealed, the financial consequences for patients potentially will be enormous."

"One of the great challenges in insurance reform is the unintended consequences of regulation," write the authors.

The Stupak/Pitts Amendment is intended to reach only a specific part of the market. But the cumulative effect of the provision, in combination with existing federal laws governing Medicaid and federal employee health benefits (as well as the law of certain states) inevitably can be expected to move the entire health benefits industry away from its current inclusive coverage norms and toward a new norm of exclusion. The provisions of the legislation, as well as the technical challenges that arise in benefits administration, militate against the creation of a supplemental coverage market. Thus, if the result of national health reform is to move millions of women into a market that operates subject to the exclusion, then it is fair to predict that the entire market for coverage ultimately will be affected as a product tipping point is reached and virtually no supplemental market appears.

In addition, state the authors:

Given past experience and the sanctions that arise from a violation, it is reasonable to predict that in interpreting and applying the exclusion, health plan administrators will err on the side of coverage denial. This is because the legal risks associated with coverage determination are all on the side of incorrectly awarding coverage, not erroneously denying it. This balancing of risks can be expected to lead insurers to calibrate coverage determinations in a way that works against women whose medical conditions ultimately lead to an abortion that they never willingly sought. 

In short, as many have already argued, women will bear the brunt of a policy created based on ideology and discrimination, not public health, pushed through by those who appear to care little for either women's rights or their lives and health.