Connecticut insurers wary of Obama’s contraceptive plan

Washington — In coming up with his compromise in the dispute over whether religious-affiliated employers should have to provide contraceptive coverage for their employees, President Obama failed to consider the concerns of insurance companies who would be required to provide contraceptive coverage for free.

“The administration never consulted us,” said Susan Millerick, spokeswoman for the Hartford-based Aetna.

Other Connecticut health insurers are letting the American Health Insurance Plans, a Washington-based trade association, voice their concerns.

AHIP spokesman Robert Zirkelbach said health plans have long offered contraceptive coverage as part of a package of comprehensive health benefits.

But Obama has proposed requiring insurance companies to offer contraceptive services “for free” to the employees of religiously affiliated organizations.

Contraceptives are included in preventive health care services required by the Affordable Care Act. Under that mandate, most employers will be required to offer their workers birth control coverage without deductibles or any kind of cost sharing.

But religious organizations, especially the Catholic Church, said it’s a violation of religious freedom to require them to pay for birth control. So administration officials decided insurers should provide birth control coverage at no cost to the employees of these religiously affiliated organizations.

The health insurance industry doesn’t see it that way.

“We are concerned about the precedent this proposed rule would set,” Zirkelbach said.

There’s also concern about the cost of this “free” coverage to health insurance companies.

It would vary, depending on the form of birth control. Generic birth control pills are available at about $9 a month. But brand-name contraceptives are more expensive, and some inter-uterine devices may cost as much as $500.

Then there’s the question of sterilizations, which are expensive procedures. The Catholic Church bans sterilizations unless they are needed for health purposes and says it won’t pay for their coverage.

A source in the insurance industry who is involved in the controversy said offering free birth control coverage “may be cost neutral in the long run” as it would prevent the high costs of obstetrics and delivery and the even higher costs of treating health complications in pregnancies.

“The question is ‘where do the funds come from to pay for birth control up front?,'” the source asked. “Health insurers don’t have money that doesn’t come from their customers.”

Mickey Herbert, former CEO of Connecticare, said Thursday that Obama’s compromise “is not the way insurers operate.”

“If we know contraceptives cost $600 a year, that $600 by all rights needs to be built into the premiums. I take offense at the president or anyone else who says (contraceptive services) are free,” Herbert said.

He also said Connecticut’s insurers “should absolutely be speaking out about the fact that the coverage is not free.”

For now, insurers are adopting a wait-and-see attitude until they find out more about Obama’s plan.

“We need to study the mechanics of this decision before we can understand how it will be implemented and how it will impact our customers,” the Aetna said in a statement.

But the Catholic Church has already rejected Obama’s compromise, saying the proposal “raises serious moral concerns” even if it would no longer have to pay for contraceptive coverage.

The church escalated its opposition to Obama’s plan this week, vowing to press for legislation in Congress that would stop it. Catholic bishops also threatened to challenge the policy in court.

Cardinal Daniel DiNardo said Obama’s plan would allow insurers to shift the cost of contraceptive coverage back to the religiously affiliated institutions who object to it.

“The argument that they will not really have to subsidize the coverage, because insurers will offer it ‘free of charge,’ runs up against the reality that this coverage will be integrated into their overall health plan, and subsidized with the premiums paid by employer and employee for that plan,” DiNardo said in a statement released by the U.S. Conference of Catholic Bishops.

The Catholic Church has as allies Republicans in the House and Senate, who are proposing legislation that would repeal the contraceptive rule.

Senate Majority Leader Harry Reid, D-Nev., said he would allow a vote on the repeal during debate on a pending highway bill. But Democrats are likely to muster the votes to defeat it.

All of the Democratic members of Connecticut’s congressional delegation support the contraceptive compromise, as does Sen. Joe Lieberman, an independent.

“The fact of the matter is, for the overwhelming majority of Americans, this issue is just not controversial. Contraception is one of the most common health-care services used by women in the United States,” said Rep. Rosa DeLauro, D-3rd District, at a hearing on the contraceptive issue held Thursday by House Republicans.

Under current law, the decision of whether to mandate contraceptive coverage in a health plan is left up to the states. Connecticut is among several states that require insurers to offer that coverage. But the state allows religious employers with “bona fide religious tenets” to opt out of birth control coverage.