SACRAMENTO, Calif. — State officials in California have put health insurers of two Catholic universities on notice that they have re-interpreted the law to require coverage of elective abortion procedures in health-insurance plans. The decision affects Catholic employers who provide group health-insurance plans to their employees, but it also may create legal challenges endangering California’s access to federal funding.
“It’s a particularly disappointing and frustrating ruling by the Department of Managed Health Care,” said Ned Dolejsi, executive director of the California Catholic Conference.
“We feel that, as Catholics, abortion is not part of medical care, but is the taking of innocent human life.”
Michelle Rouillard, director of the state Department of Managed Health Care, put health insurers on notice in an Aug. 22 letter about how her office “erroneously approved or did not object to” language in health plans that restricted or limited “coverage for termination of pregnancies.”
The DMHC told insurance providers that the 1975 Knox Keene Act requires “the provision of basic health-care services.” The health-plan regulator added that the California Constitution also “prohibits health plans from discriminating against women who choose to terminate a pregnancy” and that the California Reproductive Privacy Act also forbids “exclusions and limitations” of legal abortion coverage.
“Thus, all health plans must treat maternity services and legal abortion neutrally,” it said.
The department’s announcement effectively quashes efforts made by two Jesuit institutions, Santa Clara University and Loyola Marymount University, to bring their health plans into closer alignment with their Catholic values by excluding “voluntary” or “elective” abortion from their employee health plans.
Both terms are now considered by DMHC to be “discriminatory coverage exclusions.” Kaiser Permanente and Anthem Blue Cross, which provide SCU and LMU health plans, were instructed by DMHC to remove the language and demonstrate full compliance with the new directive within 90 days.
Studying the Impact
Both the SCU and LMU administrations told the Register in separate statements that they were studying the impact of the DMHC directive.
“Given the information provided in the letters, Santa Clara University has reached out to its insurers,” SCU spokeswoman Deepa Aurora said. “We will confer with them to ensure that our health plans continue to be fully compliant with state and federal law.”
SCU’s president, Jesuit Father Michael Engh, had stated last October that SCU’s “core commitments as a Catholic university are incompatible with the inclusion of elective abortion in the university’s health plan.”
SCU’s new health plans were scheduled to go into effect in January 2015.
“[W]e have not as of yet heard anything from our insurers,” said Joseph La Brie, chief of staff to LMU President David Burcham. La Brie said LMU had only seen the DMHC letters “reversing its earlier decision” to authorize group health plans “that exclude coverage of elective abortion procedures.”
LMU had already implemented the new changes to its employee plans in January, when state officials made the change.
“We are waiting to hear from [our insurers] what this new decision means in terms of ensuring that our current employee health-care plans comply with state and federal law,” La Brie stated.
The Jesuit universities’ decision to exclude coverage of “elective abortion” of an unborn child — not abortions recommended by a medical professional for reasons of preserving the mother’s life or health — prompted a coalition of disgruntled employees and abortion-advocacy groups that put pressure on the Women’s Caucus of the state Legislature, which in turn demanded action from Democrat Gov. Jerry Brown’s administration.
“We’re thrilled that the state is complying with California law and ensuring that [the] women of California have access to all reproductive health services,” Beth Parker, chief legal counsel to Planned Parenthood Affiliates of California, told the San Francisco Chronicle.
Brown is a Catholic who studied at SCU for one year and then attended a Jesuit seminary for three years, before leaving the Society of Jesus in 1960 to study law. The governor’s office did not reply to a request from the Register for comment about the issue prior to this article’s publication.
Weldon Amendment Violation?
However, the legal battle in California may only be just beginning. The Brown administration’s decision to force all health insurers to cover “elective abortion” may be a violation of federal law that could cost California close to $90 billion covered by the Weldon Amendment.
A letter sent on behalf of the Cardinal Newman Society from the Alliance Defending Freedom and Life Legal Defense Foundation, two nonprofit public interest firms, warned the DMHC’s Rouillard that “federal law prevents California from mandating that a health-insurance plan include abortion coverage.”
The letter, signed by ADF senior legal counsel Matt Bowman and LLDF legal director Catherine Short, outlined that the Weldon Amendment prohibits a state from making use of federally appropriated health, education and labor funds if it discriminates against a “health-care entity” — the term includes health-plan providers — because that entity “does not provide, pay for, provide coverage of or refer for abortions.”
The public interest firms warned that they were prepared to file a legal complaint with the Department of Health and Human Services’ Office of Civil Rights, demanding the enforcement of the Weldon Amendment, if Rouillard’s office did not reverse its decision.
“The DMHC’s action is a clear violation of the Weldon Amendment and, if not reversed, could trigger loss of funding to the entire state and its departments,” the letter stated.
The DMHC directive does not affect all Catholic entities in California. Entities that self-insure, religiously sponsored insurance carriers and health-care facilities that object to paying for abortion for conscience or religious reasons are unaffected.
California’s Catholic entities that self-insure or belong to the Reta Trust, which provides health plans to Catholic dioceses and religious employers, are not affected by the new interpretation, according to Dolejsi. He explained they do not have managed health-care plans that would fall under the purview of the DMHC.
But he said the DMHC directive does pose a serious problem for LMU, SCU and all Catholic employers with managed health-care plans from other health insurers.
“One would expect that there will be a legal challenge to this particular decision,” he said.
Dolejsi said these new developments will be “a focal point” of the California Catholic Conference’s agenda over the next couple months.
He added that the state’s action was an “unnecessary one” in the minds of most reasonable people, but only made sense in the context of Planned Parenthood’s rapid expansion of its abortion business in California.
“More abortions are performed here than any other state in the country,” Dolejsi said.
He said Planned Parenthood has successfully repositioned itself as a health-care provider under state law, receiving approval for certain trained nurses to perform first-trimester abortions without supervision, exemptions from having to meet surgical standards for surgical abortions and gaining more state funding to entrench itself deeper in the lives of the poor.
“They added 40% in funding for abortion services at the same time we were maintaining a 10% cut in MediCal rates,” he said, making it more difficult for the poor to find participating physicians who will see them.
“So put this whole picture together at the Department of Managed Health Care, and you see that the stated interest and policy in California is to promote abortion as women’s health care and promote it intensely for those who are poor.”
Peter Jesserer Smith is the Register’s Washington correspondent.