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Committee OKs grant program to spend insurer segregated funds for abortion access
Summary
The Health and Government Operations Committee voted to establish a Public Health Abortion Grant Program using segregated funds held by insurers, with an initial $2 million gubernatorial allocation and detailed transfer and reporting deadlines.
The Health and Government Operations Committee voted to pass House Bill 930 on a bipartisan vote, creating a Public Health Abortion Grant Program in the Maryland Department of Health that will draw from segregated insurer accounts established under federal law to fund clinical abortion services.
The bill requires the state insurance commissioner to order transfers from carriers' segregated accounts by Sept. 1, 2025, and directs the governor to allocate $2,000,000 to the new special fund by Oct. 1, 2025, via budget amendment. Beginning in fiscal 2027 the governor must include in the annual budget an appropriation equal to at least 90% of the ending balance in the segregated accounts that exceeds disbursements after a 15‑month period, the bill says. An amendment adopted in subcommittee clarified that interest accrued through Dec. 31, 2024, is included in the transfer amount and corrected an earlier erroneous date.
Why it matters: the measure creates a formal mechanism for the state to convert money carriers have been collecting pursuant to the Affordable Care Act into grants intended to improve access to abortion care. Committee members said the available funds represent a multi‑million dollar pool; witnesses and members estimated the six carriers with segregated accounts hold roughly $20.5 million in principal plus interest, and that about $3 million flows into those accounts annually.
Supporters, including Delegate Delia Lopez, said the funds are restricted by federal law to clinical abortion services and that the state must move promptly to make the money available for clinics and providers. The sponsor and other supporters described the proposal as a way to use money carriers already segregated for abortion services rather than relying on general tax appropriations.
Opponents raised questions about residency, trafficking, minors and federal oversight. Several members asked whether nonresidents could receive grants or services paid from the fund and whether that could unintentionally incentivize illicit behavior; sponsors said the measure does not create a residency requirement and noted that providers are trained to look for coercion or trafficking. Committee members also noted Maryland is a notification state for minors seeking abortion, and that the attorney general provided supportive testimony; federal officials (CMS) were not asked to opine on the bill.
The committee recorded opposition from several delegates; the bill passed and will move forward for further consideration.
The committee's debate included technical and legal explanations: supporters cited section 1303 of the Affordable Care Act (the statutory language governing segregated carrier funds for abortion services) and a Maryland Insurance Administration report that audited carrier accounts and balances. Members referenced New Mexico as a state that has used other state funds to respond to increased cross‑border demand for abortion services.
The committee's action directs the Department of Health and the insurance commissioner to build the program, with the sponsor and members saying details about grant criteria, eligible recipients and distribution timelines will be set by subsequent administrative action and in program rulemaking.
