Gay marriage raises insurance questions for employers

A story published in this weeks edition of New Orleans Business News reports that gay couples across the country hope their employers will say "I do" when asked if health insurance also covers their significant other.

Gay marriages in California, Oregon and Massachusetts are raising questions over who should be covered by employer-sponsored health plans and what that will mean to the bottom line.

In New Orleans, several large employers have compelled their insurers to extend health care coverage to same-sex spouses and domestic partners.

Insurance carriers ultimately define what is considered a marriage in a policy and who should be covered, said Tom Daly, managing partner for Hartwig Moss Benefits in New Orleans and board member of the Human Resources Society of New Orleans.

If an employer wants a policy to cover same-sex domestic partners or gay couples married in other states, the issue is negotiated when the policy is up for renewal.

According to Unmarried America, a Glendale, Calif.-based organization promoting fairness among unmarried workers, 82 Fortune 500 companies have adopted benefits programs for same-sex or heterosexual domestic partners.

Fifty-four of those policies are open to same-sex couples only, with 28 open to homosexual and heterosexual unmarried partners.

Extending benefits to same-sex domestic partners doesn't cost employers much more than simply including spousal benefits, said Thomas Coleman, executive director of Unmarried America. As with most policies covering families, employers only subsidize the worker's portion and the rest is up to the employee.

"From a national perspective, about 1 percent of the work force will enroll in a gender-neutral domestic partner program open to same and opposite sex-couples," Coleman said.

In a 100-person company, about 15 percent to 20 percent of employees covered under group health plans are covered as employee-plus-spouse, Daly said. Within that percentage, a much lower amount would take part in policies covering the employee plus same-sex partner.

In the mid-1990s, Tulane University began looking at a benefits package for employees in same-sex domestic partnerships, and put one in place in July of 2001, said Yvette Jones, senior vice president for external affairs at Tulane.

With 19 people out of a more than 5,000-employee base taking advantage of the extended benefit, the additional costs are negligible, Jones said.

The university extends partners the same benefits it offers all employees, including health and life insurance, dental coverage and other university perks.

"It did become a recruitment tool, primarily for faculty," Jones said.

The need to recruit and a sense of fairness drives companies to extend benefits, said Christopher Daigle, director for government and community affairs of Equality Louisiana. New Orleans-based Equality Louisiana advocates for gay, lesbian, bisexual and transgender citizens.

"We have to ask questions we think others should ask: Why should CEOs want to come into Louisiana with employees, knowing full well that not all of their employees are welcome at our borders?" Daigle said.

Increased benefit opportunities encourages diversity and the chances of pulling in a more qualified work force, said Tommy Kurtz, vice president of economic development for Greater New Orleans Inc., a public-private economic development agency.

"Employees like to work for employers that give them additional options," he said.

Same-sex benefits reflect an open and accepting work environment, said Eileen Donaghy, a senior petrophysical engineer with Shell Exploration and Production Co. in New Orleans, a wholly owned subsidiary of Shell Oil Co. headquartered in Houston.

Donaghy said she would not consider working for a company that did not offer a same-sex domestic partner benefits package.

"To me, it's reflective now of the culture within the company," Donaghy said.

Shell first introduced benefits for heterosexual and homosexual partners in 1998.

The benefits package helped Donaghy cover her partner while she was in graduate school. But it mostly helped her attitude.