Unmarried gay couples lose health benefits
Many of the state's largest employers are dropping health benefits for unmarried gay couples, seven months after Massachusetts became the only state to legalize same-sex marriage.
Massachusetts companies, some of which pioneered so-called domestic-partner benefits for unmarried, same-sex partners, said they are now withdrawing them for reasons of fairness: If gays and lesbians can now marry, they should no longer receive special treatment in the form of health benefits that were not made available to unmarried, opposite-sex couples.
Large employers terminating or phasing out domestic-partner benefits for some or all Massachusetts workers include IBM Corp., Raytheon Co., Emerson College, Northeastern University, the National Fire Protection Association, Boston Medical Center, Baystate Health System, and The New York Times Co., which owns The Boston Globe and the Worcester Telegram & Gazette.
"We're saying if you're a same-sex domestic partner, you now have the same option heterosexuals have, so we have to apply the same rules to you," said Larry Emerson, Baystate's vice president of human resources.
Health, dental, and other benefits for unmarried, same-sex partners became a mainstay at large US employers over the past decade, led by Cambridge-based Lotus Development Corp., which adopted them in 1991. After unemployment hit rock bottom during the economic boom in the late 1990s, about one in three Fortune 500 companies offered them to compete for top talent, though fewer small employers did.
No data are available on how many employers that offered the benefits are dropping them in Massachusetts. Typically, the proportion of employees who avail themselves of domestic-partner benefits is small, ranging from less than 1 percent at some employers to perhaps 2 percent.
Some companies now in the open-enrollment period for next year's benefits are informing gay employees they must marry to retain health benefits for partners. Some who are changing policies will drop domestic-partner benefits Jan. 1, while others gave employees up to a year to respond to the new marriage law. Baystate notified employees of the change in June and will grant extensions through December 2005 to gay employees considering whether to marry and preserve their benefits. The Springfield health system employs 9,000 in three Massachusetts hospitals, of which about 50 enrolled in domestic partner benefits.
Brad Salavich, global program manager for workforce diversity at IBM, which acquired Lotus in 1995, said unmarried gay employees should not be surprised by a decision to end domestic-partner benefits, effective January 2006. "We were very clear," Salavich said. The domestic-partner benefit "was an extension to equalize benefits for gay and lesbian employees who were not legally able to have their relationships recognized, he said. "If they choose not to continue to receive the benefits, that is a personal choice."
Cathleen Finn, an IBM employee in Cambridge, said she hasn't heard any complaints from colleagues. Finn, a lesbian who married her longtime partner on July 17, said, "It's not fair to offer a benefit to one group and exclude another group."
Yet, legalization of gay marriage has exposed entirely new sets of issues for human resource departments. Some companies, such as the Times Co., are dropping domestic-partner benefits for nonunion employees, while coverage for unionized workers remains subject to collective bargaining agreements. For others with workforces spread across the country, the benefits package offered in Massachusetts, where gay marriage is legal, differs from benefits packages in other states.
"By changing the policies now, it's suggesting they weren't authentic, and that's a problem," said Bob Witeck, chief executive of Witeck-Combs Communications.
Gay & Lesbian Advocates & Defenders, or GLAD, a New England advocacy organization, argues that taking them away is an unfair hardship, because the decision to marry is still more difficult for gay and lesbian couples. Unlike opposite-sex married couples, gay married couples will have to pay taxes on their benefits to the Internal Revenue Service, because federal law defines marriage as a partnership solely between a man and a woman. Gay marriage can also jeopardize enlistees' military status, and gay couples who marry may be barred from international adoptions. Some said they simply aren't ready to marry just because a longstanding barrier to marriage was suddenly lifted.
"There are layers of discrimination," said Michele Granda, GLAD staff attorney in Boston. "This is a civil rights battle, and it's going to take a matter of time but we are taking steps forward."
Among employers that provide domestic-partner benefits, those dropping them are the exception, said Russell Isaia, partner in the Boston law firm Bingham McCutchen. "It's been largely a nonevent," he said.
Indeed, Gillette Co., State Street Corp., and Bank of America Corp. continue to provide health benefits to all unmarried employees' partners, same-sex or opposite-sex. National publicity surrounding gay marriage helped spur some multistate employers to expand benefits this year to spouses or partners of gay employees inside and outside Massachusetts, including Staples Corp., National Grid USA, and Liberty Mutual Group.
Liberty Mutual will for the first time offer domestic-partner benefits in January to same- and opposite-sex couples, married and unmarried, at its Boston headquarters and in offices outside Massachusetts, said spokesman John Cusolito. In Massachusetts, the Boston-based insurer immediately began covering spouses of gay employees when marriage was legalized. "Our goal was to have our benefits more closely reflect what's going on in today's world," Cusolito said.
Each employer is allowed to design its own benefits policies, within limits set by state and federal laws. But gay marriage resulted in confusion in some workplaces. Dana-Farber Cancer Institute reversed its initial decision to end domestic-partner benefits. Dana-Farber's benefits manager, Peggy Malumphy, said the organization did so after hearing "a different point of view" from gay and lesbian employees.
Cost is a factor in dropping same-sex benefits. To maintain equal treatment for everyone, employers may find it less expensive to restrict benefits for a relatively small population of unmarried gay employees than the cost of extending same-sex benefits to all employees. With healthcare premiums rising at double-digit rates every year, said Baystate's Emerson, "providing health benefits to any employee is an issue," let alone to their partners.
But most employers said they are seeking consistent policies. "It wasn't about money when we established" domestic-partner benefits in 1993, said Katherine Pendergast, vice president of Northeastern's human resources. The university will drop them in June to "bring people under the same umbrella.
"We recognize this is a complex arena, and there are issues still to be addressed," Pendergast said.
Kimberly Blanton can be reached at blanton@globe.com. 