V. Confronting opposition.
Some opposition will be based on hatred and homophobia. It may be more productive to ignore or work around this opposition than to waste energy addressing concerns that are in fact a smokescreen for underlying hatred. Nevertheless, education is the most effective way to neutralize hatred. The most important lesson learned by those who have worked on this issue is that before progress can be made, a basic understanding of lesbian and gay relationships and the needs of lesbian and gay employees and their partners is necessary. Employers may not understand the issues involved or may not at first perceive the discrimination that arises by only offering benefits to married couples.
A. Employer Concerns
Most employers who are seriously considering the extension of benefits to domestic partners are immediately concerned with the additional cost and time involved. A cost/benefit analysis of the proposed benefits will help answer these questions. Cost depends on several factors, such as the additional beneficiaries, insurance premiums, taxes, the time to implement and administer the program, and any perceived disadvantages. Benefits to the employer arise from numerous sources. How the benefits outweigh the minimal cost should be stressed when approaching an employer.
Incentives for the employer to provide domestic partnership benefits include greater employee job satisfaction, the promotion of family health and security, and lower turnover rates. Additional advantages include the reinforcement of an employer's policy of nondiscrimination, the protection of an employer from claims of sexual orientation discrimination and helping the employer attract and retain both customers and employees who support gay and lesbian rights. While it may be difficult to put an exact monetary value to the benefits, it may be helpful to organize and present the benefits in a quantifiable fashion.
Initially, employers might view the cost of adopting domestic partnership benefits as oppressive and burdensome. Costs arise from the number of eligible participants multiplied by the cost of treating a domestic partnership. Enrollment of participants has tended to be low. A 1995 survey of employers by the International Society of Certificate Employee Benefits Specialists found that 75 percent of companies with domestic partnership polices reported an enrollment rate of 2 percent or less. (64)
If the goal is to obtain insurance coverage, contacting one or more insurance carriers should help in obtaining the necessary financial information. A listing of insurance carriers that writes polices for domestic partnerships may be found via the Internet at www.hrc.org/issues/workplac/dp/index.html
Insurance premiums for employers providing domestic partnership benefits either have not increased or have only minimally increased. For example, the City of Berkeley's insurance carrier, Kaiser, initially required a loading fee of 2% to cover any unexpected or additional costs of covering domestic partners. This loading fee was dropped after three years when there were no additional costs. In addition, employers have generally found that only a small percentage of their workers actually apply for domestic partnership benefits and the majority of those are member of opposite-sex couples. Because the majority of employees who generally apply for domestic partnership benefits are heterosexual, an employer may limit their costs by allowing only same-sex couples to qualify for those benefits. Employers have found that a preponderance of domestic partnerships are dual-income couples; that is the domestic partner has his or her own separate health care coverage, thereby reducing the actual number of "dependents" who enroll.
Employers might cite their concern of the cost of administering the program, generated by the employer's need to confirm: 1) the identity of an employee's domestic partnership, 2) whether the relationship covered meets the stated eligibility criteria, and 3) when one relationship ends and another begins. All three can be accomplished by the use of a form filed with the office manager or other managerial personnel. In addition, numerous municipalities have a domestic partnership registry. An employer could accept an affidavit from the registry as confirmation of the domestic partnership. The paperwork needed to track employees' partners, therefore, is not burdensome. Overall, the cost to the employer generally remains minimal, as a result of low enrollment and low costs.
In addition to the presentation of the cost/benefit analysis, it is also persuasive to demonstrate the present discrimination that exists between compensation packages for employees with spouses versus employees with domestic partners. Estimate how much the employer spends on employment-related benefits compared to wages to determine what percentage of the total compensation package is made up of benefits. Evaluate the provision of the extension of benefits to include spouses, both soft and hard benefits to arrive at a value of spouse related compensation. Then compare the total compensation of an employee with a spouse who receives the additional compensation versus the employee with a domestic partnership who does not. This data may form a convincing argument to demonstrate the unfairness of the employer's present benefits scheme.
Cost experiences of other employers who have provided domestic partnership benefits will also lend support to a cost/benefit analysis. For example, when the University of California extended its health benefits to domestic partners in 1997, its $442 million health care tab rose less the one-half a percent, or about $1.8 million. (65)
Employers frequently cite concerns that extending domestic partnership benefits will require the employer to invade the privacy of lesbian and gay employees. While this argument may have some initial appeal, it is easily refuted. By offering the option to obtain domestic partnership benefits, employers are not mandating that an employee disclose their sexual orientation. Merely making benefits available to those who choose to reveal their relationship to the employer invades no one's privacy. Employees who feel that the information required on the form affidavit invades their privacy are under no compulsion to apply.
B. Cost to Insurance Carriers
Employees must also address the concerns of insurance companies when seeking domestic partnership benefits that include insurance coverage. The primary concern of the insurance industry is to maintain an acceptable profit margin. In meeting this goal, the insurer is concerned with two factors: avoiding adverse selection and preventing fraudulent claims.
Adverse selection occurs when those who qualify for benefits are likely to be sick. Marriage has provided a convenient hook that the insurance industry can safely use to extend benefit coverage because it is unlikely that a larger percentage of persons will marry solely to obtain insurance coverage. A designated beneficiary option (a plan where the employee can be covered, not just a spouse), by comparison, not only allows but also invites adverse selection. For example, if an employee may cover any one person on his or her health insurance plan, and that employee has a healthy spouse and a sick parent, the employee will undoubtedly insure the sick parent. While this may be good for society, insurance companies would have no way of knowing how to set premiums rates in order to covers costs and would risk losing a great deal of money. Thus, insures need some verification that beneficiary selection is based on some criterion other than state of health, and that those who will qualify are not more likely than the average person to be ill.
The second problem, fraudulent claims, is closely connected to adverse selection. Two people are less likely to enter into marriage solely to obtain employment benefits because of the traditional social significance associated with marriage. Insurers, however, fear that two people might more readily enter into a domestic partnership solely to extend benefit coverage to one's friend. Therefore, insurers are concerned that an unpredictable number of family partnerships will be based not on a relationship between parties, but on the fact that one partner has a sick friend for whom she or he wishes to provide insurance coverage. The advent of domestic partnership registries in numerous municipalities might counteract this fear. Consequently, domestic partnerships must be structured and administered in such a way as to avoid the likelihood of fraudulent claims.
C. "Moral Opposition"
One of the most vigorous opponents of the domestic partnership proposal in San Francisco was the Catholic Church. Similarly, Colorado for Family Values was formed to support Amendment 2 to the Colorado Constitution, an attempt to prohibit any antidiscrimination laws for homosexuals. (66) Likewise, employers and employees can expect other religious groups, as well as groups such as the Moral Majority and the John Birch Society, to denounce any plan that can viewed as promoting lesbian, gay or non-marital relationships.
One aspect of the San Francisco legislation particularly opposed by the Catholic Church was the proposal to vest local government with responsibility for accepting and filing domestic partnership affidavits. This, according to the Church, was too similar to the procedure for filing a marriage certificate and might be construed as providing governmental recognition to lesbian, gay or non-marital relationships.
To those seeking to preserve a heterosexual, nuclear family monopoly on employment benefits, any change to status quo is objectionable. There is an important underlying policy decision at stake in deciding how far to go in pacifying these groups. Depending upon what constituency is being addressed, directly confronting the homophobia of the moral watchdog group, rather than relinquishing the goal of not offending these groups, may be the preferable route.
D. Union Concerns
When seeking family partnership benefits at a union-organized workplace, the presence of the union can either be a help or a hindrance. If the union is strong and has a large lesbian and gay membership, benefit extension may become more of a reality regardless of the stubbornness and homophobia of the employer. To gain a broader union support, it might be helpful to also seek benefits for unmarried opposite-sex partners, thus garnering larger support. If the union is not solidly behind the effort, however, the issue of partner benefits may die before ever coming to the employer's attention.
If the work setting has a duly elected union, individual employees cannot bargain directly with an employer over the terms and condition of employment. (67) This means that the effort to obtain benefits will have to overcome two hurdles. First, the union membership must be convinced to seek benefits for lesbian and gay families in contract negotiations. Second, the union must convince the employer to enact partner benefits. Bear in mind, however, that a union negotiator views each employee demand as a bargaining chip at the negotiation table. Even if the union presents the issue to the employer, it is possible that the "employment benefits chip" will not withstand the heat of negotiation, especially if the union fears that it would have to relinquish other bargaining chips to keep the domestic partnership benefit chip. Because unions are democratically run organizations, the interests of the lesbian and gay minority may be overshadowed by the concerns of majority members. (68)
E. Misconceptions of AIDS
The AIDS crisis has had a profound effect on all aspects of our lives. It is not surprising then, that concerns about AIDS arise in the context of employment benefits, especially with regard to health insurance. Initially, employers and insurance companies feared that the partners of lesbian and gay employees would be poor health risks, resulting in extraordinary costs. However, as of the year 2000, most of this fear from the insurance companies has been abated due to research and development.
However, a problem often affecting all employees enrolled in a company's health insurance plan is the imposition of a cap on benefits to the insured individual with certain medical conditions, such as HIV related illnesses. Employers may institute plans, generally self-insured, which set arbitrary benefit limits on claims. The limits, sometimes as low as $5,000 in a lifetime, are often found only in the plan's fine print, making it impossible for the insured to seek coverage elsewhere. Called "redlining", this limitation is surfacing in many work places across the country. Employers offer cost reduction as their justification for these plans.
Anyone seeking domestic partnership benefit plans needs to be aware of the potential problem of arbitrary caps on medical claims. A few insured people have brought legal challenges to insurance cap; the most prominent was in Greenberg v. H&H Music. (69) The Supreme Court upheld the 5th Circuit's ruling that the employer, H&H Music, did not unlawfully discriminate against its employee, John McGann, under the Employee Retirement Income Security Act (ERISA). Within seven months of making an AIDS-related claim to his health insurance, H&H Music reduced the amount of benefits anyone could receive for AIDS-related claims from $1 million to $5,000. No limitation was made on any other catastrophic illness. McGann claimed his employer had retaliated against him for exercising his medical plan rights, and therefore was in violation of ERISA. (70) The 5th Circuit, however, disagreed, affirming the district court's ruling that "an employer has an absolute right to alter the terms of medical coverage available to plan beneficiaries." The Court of Appeals went on to say that "even if the issue of discriminatory motive were relevant, judgment against McGann would still be proper because the defendant's motive was to ensure the future existence of the plan and not specifically to retaliate against McGann or to interfere with his exercise of future rights under the plan."
The Americans with Disabilities Act (ADA) may have a positive impact on insurance caps. The Americans with Disabilities Act makes it illegal to discriminate against a qualified person with a disability in all areas and terms of employment, including hiring, promoting and training. A "qualified person with a disability" is "a person who, with or without reasonable accommodation, can perform the essential functions of the job that the persons holds or desires." ADA Sec. 101(8). People with HIV infection are included within the ADA. Homosexuality and bisexuality, however, are not considered disabilities and are therefore specifically excluded from the ADA. ADA Sec. 511(a). According to Chai Feldblum of the ACLU, the ADA probably allows some exclusions and limitations in health insurance if based on actuarial data. If an employer or insurance company wishes to exclude or limit only one disease, the employer or Insurance Company may in violation of the Act. (71)
There are several possible responses to concerns about HIV-related claims. One, of course, is that AIDS is the sort of emergency health benefits should be available to meet. Health care plans cover the health needs of family members, from minor ailments to emergencies. Lesbian and gay employees, as single persons, have helped to subsidize the health costs of heterosexual employees and their families for many years. Lesbian and gay employees may need family partner benefits now more than ever and those benefits should be available to meet that need.
Nevertheless, opponents concerned with costs often are not moved by the inequity of denying coverage to potential AIDS victims, and instead focus on the costs AIDS might potentially create. Addressing these fears includes education on costs.
First, the number of lesbian and gay employees who will take advantage of employment benefits is limited. Many lesbian and gay employees do not have family partners; others have partners who have their own insurance; still others will be hesitant to reveal their sexual orientation. And even if lesbian and gay employees' partners do represent a greater risk, people with HIV are not so numerous that they will necessarily adversely affect a health plan.
Second, those who will opt for the benefits are not likely to be disproportionately sicker that the rest of the population in general. Lesbian and gay individuals in long-term stable relationships are probably at a lower risk for AIDS. In addition, the partners of lesbian employees are simply not considered at risk for AIDS. Female couples are at a lower level of risk for AIDS than heterosexual couples. Female couples enrolling in domestic partnership benefit programs tend to outnumber male couples by a ratio of four to one. (72)
Third, medical costs for cancer, organ transplants, cardiac care and other serious conditions affecting the population at large are significantly higher than the cost of treating AIDS. The current average AIDS related claim is $119,000; a premature birth can cost as much as $1 million. (73) In sum, the number of lesbian and gay partners applying for employee benefits will not be large, nor are these partners likely to pose significant cost to the employer of insurance company.
The size of a health plan should affect the insurer's attitude about this issue. The larger the plan, the greater the insurer's ability to spread the risk, and the more insignificant the effect of any single employee's or partner's illness.
F. The Role of the Media
It is important to recognize that there are different forms of media available, and the effectiveness of any form is highly dependent upon the extent of financial resources.
When an effort to achieve benefit coverage is political or legislative, the attitude of the press, especially the newspapers, can play a significant role. For example, in San Francisco's first effort to win domestic partnership recognition, the media dubbed the proposed legislation the "live-in lover" bill. Newspapers gave the issue extensive, but highly inflammatory, coverage. This high visibility probably increased the level of opposition to the measure, which was ultimately vetoed by the Mayor. In addition, California's proponents of Proposition 22 had an estimated financial backing of $16 million, which ultimately succeeded in March 2000.
When Amendment No. 2 to the Colorado State Constitution was introduced in 1992, its proponents marketed the Amendment as protection against granting gay men and lesbians "special rights." This misconception allowed the proponents of Amendment No. 2 to ultimately convince a majority of the electorate to vote for the amendment. (74)
Although the news coverage may have jeopardized the defeat of Proposition 22 and Amendment No. 2, the coverage brought the issue into the national spotlight. It has increased awareness amongst voters of the multitude of issues involved. The idea of providing family benefits to lesbian and gay partners was planted, and is now no longer new or unthinkable.
Some employers may fear adverse publicity stemming from the domestic partnership benefits, usually citing a concern that it will lead to a loss of customers. However, an employers' benefit package is usually completely outside the public view. If the media has taken notice, it quite often contains a stamp of approval for its anti-discrimination policy and may even increase customers who support lesbian and gay rights. For example, when the Southern Baptist Convention boycotted Disney because of its gay friendly policies in 1996, Disney posted record earnings. Consumers very rarely make purchasing decisions based on a company's gay employment policies, and may even recognize that domestic partnership benefits represent equal pay for equal work.
Interestingly, when Lotus Development Corporation first announced in 1991 that it had extended benefits to same-sex domestic partners, there was extensive publicity. This was the first, major, for-profit company to adopt this policy. A few months later when Levi Strauss, a far larger employer, announced that it had extended benefits to same-sex and opposite-sex partners, however, the publicity was far less extensive. If an employer fears the generated publicity, develop a strategy that would diminish such publicity. For example, being second or third in the community may lessen the media attention. In addition, the domestic partnership policy may be presented as an anti-discrimination practice.
Because a legislative or political effort to achieve partner coverage will involve the public and the media, formulating strategy for informing and dealing with news organizations as well as recognizing the financial aspects will be required. This process may be viewed as an opportunity to provide education and distribute of accurate information will alleviate. An employer should assured that media and public coverage will most likely not happen, unless it is by their discretion.
(64) HUMAN RIGHTS CAMPAIGN, HOW TO ACHIEVE DOMESTIC PARTNER BENEFITS IN YOURWORKPLACE (1999).
(65) Janet Gemignan, Prime Time for Domestic Partners, BUSINESS & HEALTH 1 (April 1, 1999).
(66) LISA GREEN, SUZANNE GOLDBERG, STRANGERS TO THE LAW, GAY PEOPLE ON TRIAL--(1998)..
(67) 29 U.S.C. [section] 159(a) (1947), provides that the union is the exclusive bargaining agent for the adjustment of grievance and negotiation of terms and conditions of employment.
(68) See Section III(B)(1).
(69) Greenberg v. H&H Music, 946 F.2d. 401 (5th Cir. 1991), cert denied., 112 S.Ct. 1556 (1992).
(70) Section 510 of ERISA states in pertinent part: "It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provision of an employee benefit plan, or for the purpose of interfering with the attainment of any rights to which such participant may become under the plan." 29 U.S.C. [section] 1140 (1999).
(71.) CHAI FELDBLUM, THE AMERICANS WITH DISABILITIES ACT: FROM POLICY TO PRACTICE 102 (1991).
(72) INTERNATIONAL FOUNDATION OF EMPLOYEE BENEFIT PLANS, FOURTH QUARTER 1994 (1994).
(73) INTERNATIONAL FOUNDATION OF EMPLOYEE BENEFIT PLANS, FOURTH QUARTER 1994 (1994).
(74) Amendment No. 2 was struck down in 1996 by the Supreme Court decision, Romer v. Evans, 517 U.S. 620 (1996).
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|Publication:||Recognizing Lesbian and Gay Families: Strategies for obtaining domestic partner benefits|
|Date:||Sep 1, 2005|
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