Ruling in same-sex marriage case extends insurance coverage, but problems with discrimination and lack of access persist.
Americans marry for love, happiness, family—and sometimes the added benefit of one person getting new or better health insurance through the other’s employer. The Supreme Court ruling on June 26 that legalized same-sex marriage throughout the country was a landmark decision with many implications. One practical effect may be health insurance coverage for thousands of previously uninsured and unmarried people in same-sex relationships.
At the same time, legal experts note that neither this year’s Obergefell v. Hodges decision legalizing gay marriage nor the 2013 United States v. Windsor decision that found the Defense of Marriage Act was unconstitutional cleared up the matter entirely. Those are constitutional, not employment law decisions, and they don’t explicitly address the obligations of employers, notes Jennifer Kates, director of global health and HIV policy at the Kaiser Family Foundation.
“There is a gray area for an employer that says, ‘We are providing spousal coverage to opposite-sex married couples but we refuse to do so for same-sex married couples.’ That employer could say that neither Windsor nor Obergefell require the employer to do so, though they would likely face legal challenges,” comments Kates.
Experts on lesbian, gay, bisexual, and transgender health issues say extending health insurance is one thing, eliminating disparities in health care services for gay Americans and others in the LGBT community is another. Among the problems they talk about are medical care for transgender Americans, adverse tiering for people with high-cost conditions such as HIV, and failure to offer insurance coverage for in vitro fertilization for gay and lesbian couples. The Obergefell decision may bring some needed attention to these shortcomings and inequities, says Michael A. Horberg, MD, one of the nation’s foremost experts on LGBT health care and the executive director of research, community benefit, and Medicaid strategy for the Mid-Atlantic Permanente Medical Group in Rockville, Md. Many people who work in health care don’t understand what it means to be a gay man or woman, and “that means there are major gaps in care,” says Horberg.
Still, no one is saying that the Supreme Court’s same-sex marriage decision was inconsequential. The Williams Institute, a think tank at UCLA’s law school that concentrates on sexual orientation and gender identity issues, estimates that about 150,000 same-sex couples live in the 13 states that did not allow same-sex marriage before the court said those bans violate the 14th Amendment. Just under half of those couples—70,000 or so—are expected to marry in the next few years, according to the institute. Putting aside for the moment the legal contingencies, many of those marriages should mean employer-sponsored health insurance coverage for spouses. Marrying will also mean the extension of Medicare coverage to some same-sex spouses. Before the Obergefell decision, same-sex marriage had become legal in 37 states, so many same-sex couples were already getting health insurance benefits. The Williams Institute estimates that the number of married same-sex couples had reached about 390,000.
Stats about same-sex couples
- Approximately 1 million same-sex couples (married and unmarried) live together in the United States.
- The number of married same-sex couples in the United States has tripled since 2013. An estimated 390,000 same-sex couples are currently married.
- About 122,000 same-sex couples are raising 210,000 children under age 18, of whom 58,000 are adopted or foster children.
- Same-sex couples are nearly three times as likely as their opposite-sex counterparts to raise an adopted or foster child.
- Approximately 150,000 same-sex couples live in the 13 states that did not previously allow same-sex marriage. An estimated 70,000 of those couples are expected to marry in the next three years.
Source: The Williams Institute at the UCLA School of Law, 2015.
Exactly how many people will gain employer-sponsored health insurance because of Obergefell is difficult to predict. A brief research piece published by JAMA the day of the Supreme Court decision—presumably so it would get the maximum attention—showed that the end of the ban on same-sex marriage in New York State in 2011 led to a small but notable increase in employer-sponsored coverage among gay New Yorkers.
The proportion of men ages 26 to 64 in same-sex marriages with employer-sponsored insurance edged up from 77.4% to 83.9% during the 18 months after same-sex marriage was legalized in New York, while the number of men in opposite-sex marriages with employer-sponsored insurance slid slightly, from 76% to 73.8%. The pattern was the same for women: an increase (78.1% to 83.6%) among those in same-sex marriages and a decrease (76.7% to 74.4%) among those in opposite-sex marriages. Gilbert Gonzales, a University of Minnesota graduate student who did the research, also found a decline in Medicaid coverage among New Yorkers in same-sex marriages.
The Obergefell decision will certainly give same-sex couples an important legal weapon if employers that offer opposite-sex coverage don’t extend it to them. But even before the decision, CMS had issued guidance based on a clarification of ACA regulations that said all health plan issuers need to offer spousal coverage to same-sex married couples if they offer spousal coverage to opposite-sex married couples. It didn’t matter what the state law was on same-sex marriage, as long as the couple was married. But, as Kates explains, just because issuers had to offer the coverage doesn’t mean that employers were legally required to buy it, although as a practical matter most did in the states where same-sex marriage was legal. In fact, even employers in the states that banned gay marriage often purchased coverage for their employees that included same-sex spousal coverage, she says. Large employers have long done so in order to attract and retain employees.
Some courts and the Equal Employment Opportunity Commission are construing Title VII of the Civil Rights Act that bans discrimination on the basis of sex by employers as also applying to discrimination on the basis of sexual orientation, according to Kates: “The EEOC just issued a major ruling which, for the first time, said that sexual orientation is inherently a sex-based consideration.”
But in one of those twists of legal and historical irony, some same-sex couples could end up losing health insurance coverage in this new era of legalized gay marriage. Employers have been offering health insurance to couples, same- and opposite-sex, in domestic partnerships since the early ’80s. In many instances, it was a tactic for extending coverage to gay couples when marriage was not a possibility.
But when courts and legislatures at the state level began overturning the prohibition on same-sex marriage, employers began dropping domestic partner insurance coverage. To continue to be covered, those couples need to marry, employers said. After the Supreme Court’s decision in June, Kaiser Health News reported that employers may do as Verizon did last year when it told same-sex partners in states where gay marriage is legal that they had to tie the knot if they wanted to qualify for benefits.
Despite the legal obstacles and, until recently, the country’s marriage laws, federal health surveys don’t show large differences between gay and straight Americans in some important health-related areas, including the proportion who are uninsured (17% of lesbians and gay men vs. 20% of heterosexuals) and having a usual place to get health care (79% of lesbians and gay men vs. 81% of heterosexuals). Of course, often lesbians and gay men are grouped with people who are bisexual and transgender, and for some of these statistics, the LGBT numbers are not so favorable, especially when it comes to health status itself.
The big LGBT tent may make sense for political, social, and other reasons, but when it comes to health status the subgroups often go their separate ways. Earlier this year, the Kaiser Family Foundation published a report, Health and Access to Care and Coverage for Lesbian, Gay, Bisexual, and Transgender Individuals in the U.S. Spend any amount of time with the report and it becomes apparent that sweeping generalizations about LGBT health status don’t hold up. For example, obesity rates are higher among lesbian and bisexual women compared with straight women but lowest among gay men. With smoking, the pattern is similar: higher rates among lesbians and bisexual women whereas the rates are similar for gay and straight men. Bisexual women are more likely to have been a victim of rape, sexual violence other than rape, and intimate partner violence than either lesbians or straight women.
HIV/AIDS still disproportionately affects gay and bisexual men and is relatively rare among lesbians. The Kaiser report cites CDC figures showing that while gay, bisexual, and other men who have sex with men make up about 2% of the American population, they account for more than half (56%) of the Americans living with an HIV infection and about two thirds of new infections. Surveys indicate that roughly 1 in 4 transgender women are HIV-positive and, to make matters worse, don’t know it, so they don’t get early treatment that can control the infection and reduce the risk of transmission.
The Kaiser report blames “challenges and barriers to accessing needed health services” for poor (at least in some areas) LGBT health status. “These challenges,” says the report, “can include stigma, discrimination, violence, and rejection by families and communities, as well as other barriers, such as inequality in the workplace and health insurance sectors, the provision of substandard care, and outright denial of care because of an individual’s sexual orientation or gender identity.”
Discrimination outside of health care can also adversely affect people’s health, notes Jeff Goodman, DrPH, a core faculty member in George Washington University’s graduate LGBT Health Policy and Practice program. According to Goodman, workplace discrimination based on sexual orientation is still allowed in 18 states and housing discrimination is legal in 28 states. Such discrimination contributes to poor health, particularly poor mental health, and may also discourage some LGBT people from marrying and perhaps gaining access to health insurance, says Goodman. “Someone might not want to get a state-issued document that he or she is married if it means getting fired or being homeless within 24 hours.”
Tears for tiers
One pressing issue for the LGBT population is the cost of medications, particularly for those with HIV. Some insurers have been accused of “adverse tiering”—putting most, if not all, HIV drugs on the uppermost and costly tier of their formularies. Last year, a civil rights complaint was filed in Florida against four insurers accusing them of adverse tiering of HIV drugs which, in addition to making drugs costly, may also feed adverse selection to plans that don’t make their HIV drugs expensive.
After the complaint was filed, the Florida insurance commissioner negotiated some quick fixes with the insurers that, among other changes, limited cost sharing for HIV/AIDS drugs. Cigna and Aetna also ended up changing their formularies. “Obviously, access without tiering for patients who are HIV-positive has a strong impact on the LGBT population,” notes Horberg, at the Permanente Group.
In vitro fertilization (IVF) is another area where LGBT groups see discrimination. For many couples, IVF is the best choice for insemination. A recent New York Times story reported that many insurers exclude IVF treatment for same-sex couples. The Obergefell decision may lead to legal challenges of those exclusions.
Despite increased coverage under the ACA and the Obergefell ruling, Goodman fears discrimination will continue. Many LGBT Americans qualify for Medicaid, which in many states is not very good insurance but is better than nothing. “If some states don’t expand Medicaid, then they may exacerbate the gaps in care for the LGBT population,” says Goodman. “Contrary to the popular perception, not everyone in the LGBT community is rich with excess disposable income. In fact, most are not.”
Transgender people face obstacles but coverage is expanding
LGBT advocates and health experts say that their community faces discrimination in myriad ways but that the problem may be more severe for transgender people. The discrimination is two-pronged. Physicians and other providers frequently turn away these patients, says M. Dru Levasseur, national director of the Transgender Rights Project at Lambda Legal. “There’s a range of discrimination among providers which could result in trouble accessing preventive care or they might face outright mistreatment,” he adds.
Health insurers also discriminate, Levasseur says. The Human Rights Campaign lists insurers in every state that offer health plans that cover care related to transgender health issues, but many insurers are not on that list. Even if a plan does provide coverage, the claims approval staff often don’t know the rules and deny care incorrectly, requiring appeals, says Levasseur. Moreover, insurers may have transgender-friendly plans but employers have to actively ask for them—and often insurers remove transgender health exclusions only from their priciest offerings, according to Anand Kalra, the health program manager at the Transgender Law Center in Oakland.
But there is good news. A growing number of insurers are covering counseling, hormone therapy, and surgery for transgender members, according to Levasseur. Ten states and Washington, D.C., have rules prohibiting insurers from discriminating against transgender men and women in the administration of health benefit plans. Of the 47 employers who responded to a 2013 National Business Group on Health survey, 60% said they would cover at least some nonsurgical gender reassignment costs in 2014, and 50% said they would offer at least one plan that covers gender reassignment surgical care, compared with just 5% in 2007.
The ACA requires essential health benefits to include coverage for all regardless of sexual orientation. Last year the Federal Employees Health Benefit Plan required all of its health insurers to cover care for members with gender dysphoria. Also, Medicare lifted its exclusion on coverage of gender-transition surgeries. It did not specify how plans should administer the benefit, instead leaving the details up to its contractors, which have been slow to act, notes Kalra.
Costs have not been as high as many thought they might be. A report from Oregon’s Health Evidence Review Commission last year showed that if the state Medicaid program covered such services, only about 175 Oregonians would seek such treatment each year, and the total annual costs would be about $150,000. The commission said this amount would be “a few thousandths of 1% of the state’s $1 billion health budget.” In January, the Oregon Medicaid program began covering care for transgender beneficiaries, including gender reassignment surgery.
In 2013, a Williams Institute survey found that employers reported low costs after adding transition-related coverage. A year earlier, the California Department of Insurance reported that after the University of California eliminated transgender discrimination in its benefit plans in 2005, its insurers did not charge the university system an additional premium. The health plan with the largest enrollment said the maximum claim costs over the first 6.5 years of the program were 20 cents per member per month.
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