Infertility Benefits for Small Group Employees in California

In this article we describe the current infertility benefits that are available to employees and dependents of small employers in California with 1 to 100 employees.

We summarize the infertility benefits and provide brochures from the insurance companies and exchanges that offer small business health insurance in California, including:

• Aetna
• Anthem Blue Cross
• Blue Shield of California
• California Choice
• Covered California for Small Business
• HealthNet of California
• Kaiser Permanente
• United Health Care

Difficulty conceiving a child, or “impairment of the reproductive system” impacts many women and men in the United States. The US Centers for Disease Control (CDC), reports that 12.2% of women ages 15-49 have used infertility services.  According to the American Society for Reproductive Medicine, reproductive challenges create an emotional rollercoaster that range from hope to despair.

Sadly, the treatment options are expensive and medical insurance coverage varies greatly.  Huge companies with tens of thousands of employees can offer very complete and robust coverage for the diagnosis and treatment of infertility.    Small employers are only able to purchase the coverage that insurance companies offer and unfortunately, it is often very expensive with very limited benefits.

Seventeen states require insurance companies to either cover infertility treatment or offer coverage.  California requires insurance companies to “offer” coverage, which results in very limited benefits.

California Insurance Code Section HSC 1374.55 requires health insurance companies to give employers an option to offer their employees infertility benefits.  Note that in-vitro fertilization is excluded, or not covered.  There is no requirement that employers purchase infertility coverage. The sad reality is that the infertility benefits that insurance companies offer small businesses in California have very limited benefits and cost is very high.

The California Assembly recently considered AB 797, which would have required that medical insurance have infertility coverage, including in-vitro fertilization (IVF) and other forms of treatment.  This proposed law died in committee in January 2022. Until a new law is passed into law however, employers are limited by the current insurance plan offerings.

We reached out to the eight insurance companies listed below and asked for information on their infertility benefits and eligibility requirements. These companies offer medical plans for companies with 1-100 employees.

Aetna offers medical plans that include infertility benefits that are about 2% more expensive than plans without infertility. The cost is based on the age of each member and applies to every person enrolled in the plan. Aetna Infertility Rider (PDF)

The Aetna infertility benefits are limited, but you can to download the Plan Design Document (PDD) for the Aetna plans and get a better idea of the benefits that are covered. You’ll want to click on “PDD Search.” The plans that include infertility will say “wINF.” The copay/coinsurance will vary depending on the plan you select.

We looked at the 2022 CA Gold HMO AVN $35/65 250 wINF and have included a brief outline of the Infertility benefits included in the plan, see image below. The infertility benefit is limited, and some exclusions may apply.

Anthem Blue Cross of California offers an Infertility Rider. If the rider is added, all “subscribers” (which includes employees and dependent spouse and children) must be enrolled in the Infertility plan. The cost is an additional $90 per subscriber.

Infertility treatment is covered at 50% coinsurance up to $2,000 and covers treatments such as In vitro fertilization (IVF), Gamete Intrafallopian Transfer (GIFT) and other services. Here is the benefit description for the Anthem Infertility Rider. Anthem Infertility Rider (PDF)

Blue Shield of California offers an Infertility Rider that employers can purchase at an additional cost. There is a separate rate table for this Rider that is determined by each member’s age and the employer’s location. Here are the benefit descriptions for the HMO Infertility Rider (PDF)  and PPO Infertility Rider (PDF). Blue Shield requires that an employer add the cost of the infertility rider to the rate for each person enrolled.  As an example, these are the rates for the Infertility Rider for Region 18, which covers Orange County, California.

California Choice does not offer employers the option to purchase additional Infertility benefits for their employees. According to California Choice’s FAQ, only health plans in the direct Market (such as Anthem and Kaiser) are required to offer employer groups the option to add infertility benefits at an additional cost. Since California Choice is not part of the direct market, but rather an “exchange” that allows small businesses to offer more than one insurance company at the same time, they don’t have the same requirement.

However, the Anthem Blue Cross plans through California Choice offer basic infertility benefits on all plans such as diagnostic tests to find the cause of Infertility. For more information, please see California Choice Infertility FAQ (PDF).

Covered California for Small Business (CCSB) offers an Infertility Rider that can be added to your California small business group plan. If you have fewer than 20 full-time employees and choose to add the infertility rider, it will be automatically applied to all non-HMO plans, and you won’t have the option to add it to the HMO plans. However, if you have 20 or more full-time employees and add the rider, it will be automatically applied to all your plans.  When an employer adds the infertility rider with CCSB, the cost is added to the rates for both employees and dependents.

To see the benefits, you must read the contract for the plan. The Summary of Benefits and Coverage (SBC) for each plan has a link to the plan contract.  The plan contract is called the “EOC” in insurance-speak, which stands for the “Evidence of Coverage.” CCSB has links to the plan “SBC’s (coveredca.com).  Here is an example: The SBC for the Blue Shield Silver 70 PPO 2250 (PDF) with the Infertility Rider has a link in the top right corner to the EOC. The EOC describes the infertility coverage on pages 174-175 of the document.

HealthNet offers an Infertility Rider (PDF) that small businesses can add to their group medical insurance plan. The average additional cost (premium) is about $3.44 per member per month on the HMO plan and $3.67 per member per month for the PPO plan.  The actual rates that apply to your small business depend on the rating region of the company (there are 19 rating regions in California) and the age of each member. Like the other insurance companies, Health Net adds the rider and the cost of the infertility rider to everyone enrolled in the medical insurance plan, regardless of whether they need the benefit or not.

The Infertility Benefits will vary depending on multiple things, but we’ve included a screenshot below of some of the HMO and PPO benefit details. You may also find this document helpful.

Kaiser Permanente offers infertility benefits (PDF) to small employers, however, your company must have a minimum of 20 eligible employees. In addition, Kaiser must be the sole insurance company. This means that you can’t offer Kaiser medical plans alongside another insurance company. The cost will vary by rating region and each member’s age. If you opt to offer the infertility benefits, it will be added to all offered metal plans.

According to Kaiser, few small employers offer infertility benefit to their employees.  Below is an image with some of the benefits and exclusions.

United HealthCare offers an Infertility rider. Unfortunately, they don’t have much sales information. However, we did learn that the benefit was just updated for 2022. The cost is added to all plans.  The infertility rider increases rates by about 3.4% on the HMO and a 4.9% increase on the PPO plans. The benefits have a $2,000 lifetime maximum. The $2,000 lifetime maximum benefit on infertility services makes the additional cost of adding the rider not a good financial decision, since the cost is high and the benefits are low.

Alternatives for Infertility Benefits other than through a California Small Business Employer

As you can see, the infertility services available to people who work as small businesses in California (1-100 employees) are very limited yet they cost a lot. Here are some companies that provide infertility benefits to large employers, and you may want to contact them to see if they have individual options. Progyny: https://progyny.com/for-employers/progyny-for-your-company/

• WINFertility: https://www.winfertility.com/employers/
• Carrot: https://www.get-carrot.com/for-employers
• ARCFertility https://www.arcfertility.com/for-employers/
• Kindbody: https://kindbody.com/employer-benefits/

While we don’t work with any of these, we reached out to WINFertility and the representative explained that their average size client has 15,000 employees but that they offer plans to companies with as few as 500 employees.

Until the California state government requires coverage of infertility benefits, insurance companies will offer very limited and very expensive benefits to small employers.

Benefits Cafe is an insurance agency, staffed by experienced, licensed agents who assist small and mid-sized companies in California with their employee benefits.  We advise clients on medical insurance plans and can assist with adding an infertility benefit rider to an existing plan.  We would need to be your “broker of record” which is as easy as sending a letter to the insurance company that informing them that you want Benefits Cafe to be the agent on your medical insurance plan.  There is no cost for our services as the insurance companies pay us and you pay the exact same rates with or without a knowledgeable agent such as BenefitsCafe.com.  Give us a call to discuss (800)746-0045.

Is infertility covered in California?

Treatment for Infertility is not a covered benefit on standard small group medical insurance plans.  Employers can purchase a “rider” or extra coverage that includes infertility benefits.  The riders have very specific limits to the range of infertility treatment services that the insurance will pay for.  In-vitro fertilization is excluded from most coverage for small businesses in California.

Is infertility an essential health benefit?

No. The diagnosis and treatment of Infertility is not an essential health benefit.  The Affordable Care Act (ACA, Obamacare) requires that all small group medical insurance include ten essential health benefits, including items such as emergency service, in and out of hospital services, and prescription medicine. Some states mandate that insurance companies include treatment for infertility.  California is not one of those states.  California requires that insurance companies “offer” coverage, which costs extra, is expensive and the benefits are very limited.

Does Anthem Blue Cross California cover infertility?

Anthem Blue Cross of California offers an infertility “rider” which is additional coverage at an extra cost. As described in our comprehensive overview of infertility benefits, Anthem’s coverage is very expensive at $90/month for every subscriber (including employee, spouse, children) and the benefit is limited to 50% of covered services with a $2,000 lifetime maximum.   Anthem does include in-vitro fertilization as a covered benefit however.

What is fertility reimbursement?

Fertility reimbursement refers to plans that an employer would set up to reimburse an employee for medical expenses incurred to assist with reproduction services.  Typically, the employer sends money to an employee after receiving evidence that an infertility service has been obtained an paid for.  These arrangements are done on an after-tax basis, which means that the employee must pay taxes on the money received from the employer.  Infertility arrangements do not involve an insurance company as it is between the employee and the employer.

How do I ask my employer for fertility benefits?

Before you approach your employer about offering benefits for the diagnosis and treatment of infertility, you may want to understand the options that are available to an employer.  Large employers with hundreds or thousands of employees have many more insurance options than small employers in California with fewer that 100 employee.  BenefitsCafe.com has summarized the options from insurance companies for small employers and there are links to large employer sites also.  It may be that asking your employer to reimburse your out-of-pocket expenses for infertility services is a better option, particularly if you work for a small employer in California.

What are infertility benefits?

Infertility benefits in insurance plans include services to diagnose the cause of the inability to conceive a child and treatments for that condition.  Some of the treatments include drug treatment and surgical repair of reproductive organs.  Some of the treatments, such as in vitro fertilization (IVF) include collecting sperm an  combining it with an egg and inserting the embryo into the womb.

Are fertility benefits taxable?

In 2021 the IRS issued a Private Letter Ruling 202114001 which specified which infertility services were tax deductible.  Generally, the IRS found that treatment for a medical condition was a deductible expense while expenses for a surrogate mother are not.   IRS Publication 502 has guidance on the tax deductibility of various medical procedures and regarding fertility services states that:

You can include in medical expenses the cost of the following procedures performed on yourself, your spouse, or your dependent to overcome an inability to have children.

• Procedures such as in vitro fertilization (including temporary storage of eggs or sperm).
• Surgery, including an operation to reverse prior surgery that prevented the person operated on from having children.

• Is IVF covered in small business medical insurance?

In California, only Anthem Blue Cross includes IVF in it’s infertility rider.  The cost to add the rider is very high, however, and may cost more than the benefits one may receive.  Anthem charges $90 per subscriber per month.  A subscriber includes every employee, spouse and child enrolled in the medical insurance plan.