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Employer's Failure to Cover Contraceptive Costs under Medical Plan Not Pregnancy Discrimination

    Client Alerts
  • April 06, 2007

In a case likely to be reviewed by the U.S. Supreme Court, the Eighth Circuit Court of Appeals held last month that Union Pacific’s group medical plan that excludes coverage for contraceptives does not violate the Pregnancy Discrimination Act (“PDA”) by treating women less favorably than men.  In 1976, the Supreme Court decided that a plan’s exclusion of maternity costs did not violate Title VII.  Congress in essence overruled this decision in 1978 through passage of the PDA.  In 2000, the Equal Employment Opportunity Commission held in an administrative ruling that a plan’s exclusion of contraceptive costs violates the PDA because the exclusion places a heavier burden on women than men.


In a 2-1 decision, the Eighth Circuit rejected the EEOC’s position, finding no sex discrimination.  Union Pacific’s plan provides no coverage for contraceptive drugs or surgery.  The court concluded that because no coverage of any kind is provided, women and men are treated equally under the plan.  Oral contraceptives for women are excluded along with vasectomies for men.  The dissenting judge argued that the plan has a disparate impact on women, because it does cover a wide range of preventative health drugs used by men, but fails to cover prescription contraceptives exclusively used by women.


Since the EEOC’s administrative ruling in 2000, most group medical plans added some coverage for contraceptive drugs and surgical procedures.  A long list of women’s health advocacy groups filed amicus briefs in this action.  Given the publicity and potential widespread effects of this ruling, it will likely be appealed by the plaintiffs to the full Eighth Circuit, and perhaps eventually to the U.S. Supreme Court.