Compliance May 1, 2004

Appeals Court Upholds Infertility Treatment Exclusions

January 17, 2003 (PLANSPONSOR.com) - An employer whose health plan does not cover infertility treatments isn't guilty of illegal discrimination, a federal appeals court decided.

Reported by

Fred Schneyer

The US 2nd Circuit Court of Appeals said that even though the infertility treatments in the specific case were only performed on women, the “exclusion of surgical impregnation procedures disadvantages infertile male and female employees equally,” the National Law Journal reported. So the employer d id not run afoul of the federal Pregnancy Discrimination Act (PDA) by declining coverage for artificial insemination and other treatments, the appeals judges said.

The appeals court upheld a lower court’s decision in favor of the employer.

Sex Specifics

Chief Circuit Judge John Walker said the proper question on review “is whether sex-specific conditions exist, and if so, whether exclusion of benefits for those conditions results in a plan that provides inferior coverage to one sex.”

“Because reproductive capacity is common to both men and women, we do not read the PDA as introducing a completely new classification of prohibited discrimination based solely on reproductive capacity,” Walker wrote. “Rather, the PDA requires that pregnancy, and related conditions, be properly recognized as sex-based characteristics of women.”

“Artificial” Distinctions

Plaintiff Rochelle Saks claimed that the refusal of her self-insured health benefits plan to cover infertility treatments was a violation of her federally protected civil rights. While employees enrolled in her health plan were allowed benefits for some infertility products and procedures, the plan specifically barred coverage for artificial insemination and other surgical impregnation procedures, such as in-vitro fertilization.

After Saks filed a federal suit in the US District Court for the Southern District of New York, US District Judge Colleen McMahon rejected her claims, finding that the exclusions of surgical impregnation procedures affected males and females equally. McMahon also said the PDA was not violated because the plan provides equal coverage for men and women.

The case is Saks v. Franklin Covey Co . , 00-9598.