Companies forced to weigh in on privacy and healthcare

Pro-choice activists are seen outside the United States Supreme Court in Washington, DC on June 15, 2022.

Mandel Ngan | AFP | Getty Images

The challenges posed by the end of Roe v. Wade are just getting started for corporate America.

By overturning the abortion precedent on Friday, the U.S. Supreme Court set off a series of new difficulties for companies that must now navigate a country divided between states that will allow the procedure and others that will ban it. .

One such issue for companies is deciding whether — and how — to provide abortion access to millions of employees who live in states where the procedures are no longer legal.

“Every large organization has health coverage,” said Maurice Schweitzer, a professor at the Wharton School of Business at the University of Pennsylvania. “The question is going to be, what’s covered? Is travel for an out-of-state abortion covered if you’re operating in a state that prohibits abortion?”

Some of the nation’s major employers, including Apple, CVS Health and Disney, reiterated that the companies cover travel to states that allow abortions. Others, like Dick’s Sporting Goods, rushed to update their medical benefits. Several prominent business leaders went further, condemning the end of 50 years of federal abortion rights.

Many more declined to comment or said they were still reviewing the plans.

The Supreme Court’s decision will have implications for the corporate world that go far beyond the health benefits for employers and the influence on the location of corporate headquarters and offices, on lawmakers. and the political action committees they donate to and how they communicate with employees, customers and investors.

Over the years, some companies have chosen to take a stand on polarizing issues, including the police killing of George Floyd, a black man, and Florida’s HB 1557, dubbed the “Don’t Say Gay” bill. “.

The Supreme Court’s decision will likely force the hand of corporations and prevent business leaders from remaining silent, Schweitzer said. With these decisions, he said, companies could risk lawsuits, clash with politicians and draw backlash from customers or employees.

“It’s going to be an additional challenge for the leaders,” he said.

For companies that decide to cover abortion care in other states, this will raise new questions, including how to reimburse travel expenses and protect employee privacy.

Extension of benefits

Some companies like Netflix, Microsoft and Google’s parent company Alphabet already have healthcare policies that include abortion and travel benefits, but others are catching up.

JPMorgan Chase told employees in a memo it would expand its medical benefits to include travel coverage beginning in July. Under Armor said it would add a travel benefit to its medical plans. Dick CEO Lauren Hobart shared on LinkedIn that employees, their spouses and dependents will receive up to $4,000 in travel reimbursement if they live in a restricted area.

Warner Bros. Discovery also reached out to its employees after the decision was announced on Friday.

“We recognize that the issue of abortion can evoke a variety of emotions and responses that are different for each of us based on our experiences and beliefs,” wrote Adria Alpert Romm, head of human resources and culture, in a memo to employees obtained by CNBC. . “We are here to support you.”

Romm said the company is expanding its health care benefits to include expenses for employees and their covered families who must travel to access a range of medical procedures, including care for abortions, family planning and health. reproductive.

Amazon and other companies added travel reimbursement earlier this year as Sunbelt state governments passed laws that closed abortion clinics or limited access by other means.

But how companies respond over time will vary and could include removing abortion coverage from health plans or offering indirect assistance such as paid time off or contributions to a health account. health savings that could be used for travel-related expenses to receive care in another state.

Nearly 30% of organizations said they would increase support for an employee assistance program for reproductive care in a post-Roe world, according to a survey of more than 1,000 healthcare professionals. human resources for the Society for Human Resource Management. The survey was conducted from May 24 to June 7.

About a third cited paid time off as the main resource provided to support reproductive care and 14% said they would include the topic of reproductive rights in their diversity, equity and inclusion programs.

Nearly a quarter of organizations said offering a health savings account to cover travel for reproductive care in another state will boost their ability to compete for talent.

Companies take a stand

Even before the Supreme Court ruling, companies were under pressure to intervene in the abortion debate — or at least explain how abortion limits and bans might affect their businesses.

Corporations have long used their economic power to influence political policy. In 2019, when Georgia lawmakers sought to ban nearly all abortions, Hollywood used the threat of production boycotts in the state to clarify his views on politics.

Yet in the wake of the pandemic, studios have been slower to react to new laws they might have traditionally opposed. Production shutdowns are no longer a luxury Hollywood can afford, especially as it seeks to meet demand for new content..

Disney has just come out of a recent battle over a burning cultural issue. The company publicly opposed Florida’s so-called “Don’t Say Gay” bill, after its employees called on the company to take action. Florida Governor Ron DeSantis Florida’s Republican-led Legislature in turn revoked the company’s special district in the state, which is home to Walt Disney World and other resorts.

In a memo to employees Friday, Disney said it “remains committed to removing barriers and providing full access to quality, affordable care for all” employees. Disney, which already has pre-existing travel benefits that allow its employees who cannot access care in their current location to seek medical attention for cancer treatments, transplants, rare disease treatment and planning family, which includes pregnancy-related decisions.

As states decide whether to uphold or block abortion rights, legislatures may face backlash from influential businesses and business leaders. This could include boycotts, loss of political donations, or informed decisions about the location of corporate headquarters, distribution centers, or new facilities.

“Overturning Roe v. Wade is a devastating decision by the Supreme Court of the United States,” billionaire and business magnate Richard Branson wrote in a statement. “It won’t reduce abortions, it will just make them unsafe. Reproductive rights are human rights. We all need to stand up for choice.”

Branson was among companies and business leaders who criticized the Supreme Court’s decision.

“This decision puts women’s health at risk, denies them their human rights, and threatens to undo the progress we’ve made toward workplace gender equality since Roe,” said Jeremy Stoppelman, co-founder and CEO of Yelp. “Business leaders must step up to support the health and safety of their employees by speaking out against the wave of abortion bans that will be unleashed as a result of this decision, and calling on Congress to codify Roe into law.”

Investors in public companies could have a major influence on how responses to the new ruling are crafted.

At a Walmart shareholder meeting earlier this month, an investor called on the nation’s largest private employer to release a report on the potential risks and costs to the company of state policies that restrict reproductive health care, and any company plans to mitigate these risks. . The proposal, which is not binding, met with opposition from the retailer and did not receive majority shareholder support.

Similar proposals may be presented to shareholders’ meetings of other companies in the near future. Analysts could also probe executives in upcoming earnings calls.

Walmart is based in Arkansas, a state that already has a law on the books to trigger a ban. The company declined to comment on Friday when asked if it would cover travel costs to states that allow abortions. It already pays for trips to hospitals and medical centers for other types of medical procedures, such as spine surgery and some heart procedures.

Wharton’s Schweitzer said employees and customers increasingly expect more from companies and want to join or spend money with those that reflect their values.

The corporate world led the way in some cases, with corporations turning Juneteeth into a corporate holiday before it became federal. Some companies, such as Unilever-owned Ben & Jerry’s, and CEOs, such as Chip Bergh of Levi Strauss & Co., have become known for speaking out.

“There has been a growing trend among executives to become more involved, to engage more in social and political issues,” he said. “It’s going to increase that trend where we’re going to see a lot of leaders speaking out, a lot of leaders leading on this issue and it’s going to normalize the idea that leaders are part of the political process.”

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