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Column: This huge insurer got caught breaking a law protecting contraceptive access, but its fine is a joke

There’s good news and bad news about a legal settlement that New York state just reached with the giant health insurer UnitedHealth over its denial of contraception coverage for a member, which violated state law.

The good news is that UnitedHealth got caught and has been ordered to reimburse the member — and all others in her situation — for the out-of-pocket costs they incurred.

The bad news is that in addition to the reimbursement order, New York Atty. Gen. Letitia James imposed a penalty of only $1 million on the company.

The ability to access birth control and the legal right to it are being threatened by extremists. The threat goes against the will and the desires of the American public, which overwhelmingly supports birth control and overwhelmingly use it.

— Gretchen Borchelt, National Women’s Law Center

For UnitedHealth, that’s the equivalent of about one-hundredth of a penny based on its annual revenue. In other words, if someone dropped a packet worth of $1 million on the street in front of the company’s chairman, he might not even bend over to pick them up for fear of creasing his trousers.

A couple more bits of bad news: Not only is UnitedHealth a “repeat offender” in breaching contraception access laws (in the words of Gretchen Borchelt of the National Womens Law Center), but it’s also not the only health insurer engaging in sophistry and pretexts to deny members access to birth control in violation of state and federal laws.

The center has documented cases in which Blue Cross and Blue Shield affiliates, the pharmacy benefit manager CVS Caremark, and others have charged customers illegal out-of-pocket payments or imposed prior authorization rules before approving reimbursements for contraceptives.

Vermont regulators last year reported that they discovered 14,000 instances affecting 9,000 residents who were illegally charged for contraceptives that the law required to be dispensed without costs. The state’s three largest health insurers — Blue Cross Blue Shield, MVP Healthcare and Cigna — illicitly shifted $1.5 million in costs for contraceptives, tubal ligations and vasectomies to consumers over the prior two years. The health plans were ordered to reimburse their members.

In 2022, the House Committee on Oversight and Reform found widespread violations by health plans and pharmacy benefit managers of the Affordable Care Act’s mandates that the full range of FDA-approved birth control be offered to all customers. The committee cited the NWLC’s findings, and specifically queried five of the largest insurers (including UnitedHealth) and four of the largest PBMs to determine whether they were complying with the law.

But that was when the committee was under a Democratic Party majority. Since it came under GOP control last year, it’s been preoccupied with chasing the Hunter Biden case and harassing scientists and government officials as part of a fruitless effort to prove that the COVID-19 pandemic originated in a Chinese lab. So women’s healthcare rights have fallen off its radar screen.

Protecting access to contraceptives is more important today than it has been since 1965, when the Supreme Court guaranteed married couples’ access to contraceptives on privacy grounds in Griswold vs. Connecticut; that decision was augmented in 1972 in Eisenstadt vs. Baird, which extended access rights to single women, and of course by Roe vs. Wade, which brought privacy protections to the right to abortion in 1973.

The Supreme Court overturned Roe vs. Wade two years ago Monday, fomenting sheer chaos and pain and suffering for women in the states that have jumped in to quash abortion rights since that moment.

Politicians and judges in anti-abortion states have been talking about extending the Supreme Court’s abortion ruling to contraception. Supreme Court Justice Clarence Thomas, in a concurring opinion to the Dobbs decision overturning Roe vs. Wade, listed Griswold among the precedents he thinks should be “reconsidered.”

A popular claim is that contraceptives fall into a ban on the mailing of those products enacted as part of the Comstock Act in 1873.

Past practice and legal tradition relegated the act, which Congress passed at the behest of Anthony Comstock, one of the outstanding bluenoses of American history, to the scrap heap long ago. Most rational legal experts, including those at the Department of Justice, interpret it today as banning the shipment of materials destined for illegal use; since contraceptives are legal nationwide and only 14 states have total abortion bans, it’s maybe hard to make the illegality claim stick.

Nevertheless, the Comstock Act was cited in the ruling by federal Judge Matthew Kacsmarykoutlawing mifepristone for medical abortions and by U.S. 5th Circuit Court of Appeals Judge James C. Ho in his partial dissent from an appellate decision placing some of Kacsmaryk’s ruling on hold; both judges are certified anti-abortion fanatics. The Supreme Court threw out their restrictions on the drug, protecting access nationwide for the present, on June 12.

As recently as June 5, Senate Republicans blocked a Democratic effort to install a right to contraception in federal law. The Democratic measure won 51 votes — a majority, but not enough to forestall a filibuster threat, which would have required 60 votes.

The UnitedHealth case illustrates how contraceptive rights can fall victim to the complexities of America’s fragmented healthcare system, though that’s not an excuse for the company’s legal violation.

In response to the settlement, UnitedHealth told me by email that it aims for all its members to have “timely access to a variety of high-value and affordable FDA-approved contraceptives when they need them.” It says it provides “access to more than 150 FDA-approved contraceptive options with $0 cost-share.”

Under New York law, that may not be enough. The state requires health plans to provide access to all contraceptive options approved by the Food and Drug Administration without cost-sharing. That goes further than the Affordable Care Act, which requires health plans to provide access to at least one treatment in each of several contraceptive categories “without copays, restrictions, or delays.” California’s Contraceptive Equity Act requires health plans to cover certain birth control methods without copays; voters enshrined rights to abortion and contraceptives in the state Constitution via Proposition 1 of 2022, which passed by a decisive 2-1 majority.

UnitedHealth ran afoul of New York’s law when it denied coverage to a member whose doctor had prescribed Slynd, a progestin-only oral contraceptive. The product is aimed at patients for whom the more conventional estrogen-based birth control is medically unsuitable. The patient filed a complaint with state regulators last year.

UnitedHealth refused to cover the product because of “safety concerns,” according to the state’s settlement. It insisted on prior authorization and step therapy (in which patients are required to try cheaper treatments first) before approving coverage, and continued to deny the patient coverage even after an appeal and queries by the state attorney general and other regulators. The insurer says it has dropped these requirements for Slynd.

The settlement requires UnitedHealth to identify and reimburse all members who were denied contraceptive coverage without copays or restrictions at any time since June 1, 2020, plus 12% annual interest.

How James and UnitedHealth came to the $1-million penalty isn’t clear — the contraceptive access law itself doesn’t carry a penalty clause, but other potentially relevant state laws do. The attorney general’s office noted that the penalty was imposed after only a single complaint, suggesting that it took the matter seriously.

What is clear, however, is that if the penalty is meant to be a disincentive to deliberately flouting the law or doing so through inaction or inattention, it’s laughable. UnitedHealth collected $371.6 billion in revenue last year — that’s more than $1 billion a day. Of that sum, nearly $291 billion came from insurance premiums. The firm reported more than $29 billion in pretax profits last year.

Imposing unnecessary, burdensome or illegal restrictions on contraceptive access is one way that health insurers or other healthcare providers make themselves complicit in the conservative project to narrow women’s reproductive health options.

It should be remembered, for example, that the drugstore chain Walgreens announced last year that it wouldn’t distribute or ship mifepristone in at least 21 red states, including at least four where abortions remain legal. The company was unnerved by a saber-rattling letter it received from the attorneys general of those states warning vaguely of “consequences” for shipping mifepristone, a drug used to induce abortions. The letter cited the Comstock Act.

Walgreens said in March that it would start distributing the product to physicians, but not directly to patients and not in states where abortion is banned.

“The ability to access birth control and the legal right to it are being threatened by extremists,” Borchelt says. “The threat goes against the will and the desires of the American public, which overwhelmingly supports birth control and overwhelmingly use it.”

Surveys by the NWLC — and patient complaints filed via its CoverHer hotline — document that restrictions on coverage for legal birth control have been endemic. Some plans have refused to cover products such as the vaginal contraceptive ring or contraceptive patch, arguing that other “hormonal” contraceptives were covered and therefore patients didn’t need access to the ring or patch, which are obviously discrete methods. That was an argument used by UnitedHealth.

Other health plans have covered only certain IUDs, or covered only generic contraceptives even when patients had difficulty tolerating any but brand name products. Women who underwent tubal ligations were told that their insurers would cover only the direct cost of the procedure, but not anesthesia, medications or facility charges. Some have been denied coverage for innovative but FDA-approved birth control methods, such as a hormone-free gel.

Patients denied coverage are often forced to undertake lengthy appeals and continue their efforts through repeated denials.

Whether because it is the nation’s largest health insurer or it has continued to place barriers in the way of members seeking coverage to which they’re entitled by law, UnitedHealth is “one of the insurance companies we hear about most often through our CoverHer hotline as being problematic,” Borchelt says. “They have been on notice that it has been violating the law in numerous ways; while the New York attorney general has done incredible work that will make a real difference for consumers not just in New York, but it shouldn’t have come to this.”

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