(The Center Square) – California Gov. Gavin Newsom signed a bill requiring insurance covering nine million Californians, including state employees, to cover three rounds of in vitro fertilization and redefines infertility as “a person’s inability to reproduce either as an individual or with their partner without medical intervention,” which is more inclusive of LGBTQIA+.
“I wholeheartedly agree that starting a family should be attainable for those who dream to have a child — inclusive of LGBTQ+ families,” wrote Newsom in his bill signing letter. “In January of this year, we started the process of updating the state’s ‘benchmark’ plan, which will set a new standard for commercial insurance health coverage. The services under evaluation specifically include infertility treatment and IVF. The state’s proposed benefit design will be released later this year and adopted by the Legislature by May 2025.”
SB 729 requires insurers to cover three completed oocyte retrievals (when eggs are taken from ovaries), and unlimited embryo transfers (when fertilized eggs are put into the uterus). According to a State Senate analysis, this policy would increase premiums paid by just state employees by $49 million in FY 2024-2025, with more than half of those costs covered by taxpayers.
A State Assembly Analysis found that the typical IVF cycle costs $19,234 for the first round, and $6,995 for each subsequent round, and that couples undergo an average of 3.7 cycles of IVF, and that the bill would increase the health expenditures of the nine million covered enrollees by $183 million in the first year and $330 million in the second year.
While this bill only applies to large insurance plans, the state is creating a new “benchmark” plan that the governor says will likely result in fertility coverage expansions to individual plans and MediCal, the state’s taxpayer-financed healthcare plan.
“It is important to note that the Governor has asked for a six-month delay in implementation to allow the state legislature to evaluate whether to keep the law as is or match what the state decides to include in its essential health benefits (EHB) benchmark plan,” said Barbara Collura, President and CEO of RESOLVE: The National Infertility Association, in a statement. “This could mean that everyone in the fully insured market (individual, small and large groups) would have IVF insurance coverage when the new benchmark plan takes effect, but the details of that coverage remain unclear.”
The coalition against the bill included the California Chamber of Commerce and the California Department of Finance, which are often in opposition. The Chamber noted that “when health plans and insurers are required to cover new services or to waive/limit cost-sharing requirements for certain services, premiums for all enrollees and purchasers go up,” while the Department of Finance said the bill creates costs and pressures not included in the Administration’s spending plan.” The Assembly analysis also noted “To the extent this bill results in additional assessments on health plans and insurers, consumers may face increased health care premiums.”
An analysis from the conservative Heritage Foundation found that health insurance premiums doubled between 2013 and 2017, both through expanding required coverage and creating a guaranteed subsidy that could allow insurers to rapidly raise rates, show consumers only a small direct rate increase, and have taxpayers pay for the rest of the rate increase on the back end through higher taxes. By statute, taxpayer subsidies for some individuals cover nearly 100% of the health insurance premium.
According to Covered California, the state’s ACA marketplace, 90% of the state’s 1.6 million enrollees who purchase individual or family insurance on the marketplace receive subsidies, with two-thirds of those individuals eligible to pay $10 or less per month for insurance.
