Virginia Senate repeals ban on abortion coverage for plans offered through state exchange

For the last decade, Virginia has banned private plans on the state’s health insurance exchange from covering abortions in all but narrow circumstances.

But in an almost entirely party-line vote on Friday, the state Senate passed a bill from Sen. Jennifer McClellan, D-Richmond, that would remove that prohibition in state code. 

It’s one of the lingering barriers to abortion access in Virginia, which McClellan and other legislators have been on a push to roll back for years — with much more success since Democrats took control of both General Assembly chambers in 2019.

“This is an issue that I’ve been fighting on for a really long time,” McClellan said in a phone interview on Friday. “And this is just the next step in protecting access to reproductive health here in Virginia.”

The bill does not require insurance carriers on the exchange to offer abortion coverage. And federal subsidies that help cover the cost of the plans on the exchange are still prohibited from covering any abortion services that don’t fall under the narrow constraints of the Hyde Amendment, which carves out exceptions for pregnancies resulting from rape or incest or those that could endanger a patient’s life.

A fiscal impact statement from the Virginia State Corporation Commission noted that both the House and Senate bills would require the agency’s Bureau of Insurance and Health Benefit Exchange “to ensure that insurance carriers are billing, collecting and accounting for the portion of premium attributable to elective abortions for which federal funds cannot be used.”

That didn’t stop Republican senators from voting against the legislation on Friday (one Democratic senator, Joe Morrissey, also voted no.) Sen. Steve Newman, R-Bedford, said many weren’t convinced that federal taxpayer money wouldn’t go toward abortion services if the measure passed the chamber.

“I think that’s why you have a number of people that are concerned about the intent of the Hyde amendment,” he said. “Which is basically, there are some of us who believe that on this very controversial item, no tax money should be used in this way.”

The current prohibition on abortion coverage dates back to 2011, soon after the federal Affordable Care Act was passed under then-President Barack Obama. The ACA prohibited abortion coverage from being required as part of an essential benefits package. Obama also signed an executive order — still in effect today — that prohibited federal subsidies from being used to cover abortion beyond those allowed under the Hyde Amendment.

McClellan said the federal law also allowed states to impose stricter restrictions for plans under their own health care exchanges. The current prohibition in Virginia, proposed by then-Gov. Bob McDonnell, bans abortion coverage beyond the same narrow exceptions spelled out in the Hyde Amendment.

“It is government overreach into private health insurance plans,” said Del. Sally Hudson, D-Charlottesville, who’s sponsoring an identical bill in the House. “Because what the ban does is prohibit any private health insurer that does business on our state exchange from offering a plan including abortion coverage that any private patient could purchase.” 

The prohibition currently applies to the roughly 240,000 Virginians enrolled in private plans on the state’s health exchange (McClellan’s office couldn’t immediately provide a breakdown of how many of them are people who can become pregnant.) 

Abortion is covered by many employer-provided plans, which aren’t regulated under the Virginia marketplace. But McClellan said the prohibition on health insurance plans under the state exchange is especially detrimental to people who already struggle to afford basic health care.

“You’re basically saying to those people that they’ll have to pay out of pocket,” she said. “Which disproportionately targets women of color and low-income women who can’t pay it out of pocket.”  

Hudson added it was especially important amid the ongoing COVID-19 pandemic, as many Virginians have lost their jobs and employer-provided benefits. Out-of-pocket abortion services can be significant. According to Planned Parenthood, prices often start at $460 for the procedure alone. That doesn’t include affiliated expenses, including sedation or the transportation and lost wage costs that many often shoulder.

It’s not immediately clear how many insurance carriers would begin covering abortion services through Virginia’s exchange if the prohibition was removed. In 2011, more than 80 percent of private plans across the country provided coverage, according to The New York Times. Doug Gray, executive director of the Virginia Association of Health Plans, said insurers typically didn’t get involved in the issue (“We follow the law,” he wrote in a Friday email.)

But McClellan said that 25 other states currently allow abortion coverage under their health exchanges, and insurance companies have stepped up to provide those services.

“I think the same providers that service those states will provide the same benefits here, as well,” she said. 

The legislation must still be passed by the House and signed by Gov. Ralph Northam to take effect. Last year, Northam signed several bills that rolled back abortion restrictions, including measures from McClellan and House Majority Leader Charniele Herring, D-Alexandria, that repealed mandatory ultrasounds and a 24-hour waiting period before those services could be provided.