CA Fully Insured Health Plans Must Cover OTC Contraception Starting in 2024

In September of 2022, Governor Newsom signed SB 523, the Contraceptive Equity Act of 2022, into law which, amongst other things, requires fully insured health plans to cover over the counter (OTC) contraceptives without cost sharing. At the time the law was signed, this wasn’t particularly meaningful to those with health insurance as there were no OTC contraceptives that were FDA approved.

As of July 13, 2023, the FDA approved the first OTC daily oral contraceptive pill and the drugmaker has indicated it will be available OTC  starting in first quarter of 2024. Coincidentally (or not), CA fully insured health plans are required to cover OTC contraceptives at the point of sale, at no cost to the member, effective January 1, 2024 for plan years starting or renewing on or after that date.

What is it? SB 523 expands coverage of contraceptives to provide point-of-sale coverage for OTC “FDA-approved contraceptive drugs, devices, and products at in-network pharmacies without cost-sharing or medical management restrictions”.

Which health plans must comply? All CA fully insured group health plans. This also includes health plans offered by public or private institutions of higher learning that directly provide health care only to its students, faculty, staff, and administration.

Religious employers, as defined by CA law, may request a group health plan without coverage for FDA approved contraceptive methods that are contrary to the religious employer’s religious tenets.

When is it effective? Applies to health plans issued, amended or renewed on and after January 1, 2024.

Example: A health plan that renews starting 1/1/24 must cover OTC contraceptives approved by the FDA without cost sharing or medical management restrictions starting 1/1/24.

Are employers that sponsor a health plan required to notify their employees of this change? The law does not require employers to notify their employees of this change; however, ERISA requires group health plans to distribute a summary of material modifications (SMM) whenever there is a change with regards to the contents in the SPD. The SMM must be distributed within 210 days of the adopted change.

What should employers do next? If its group health plan is subject to CA SB 523, the employer should issue the SMM to plan participants within 210 days of the start or renewal of your health insurance policy in 2024.


CA passed a law to ensure that fully insured health plans cover FDA approved OTC contraceptives. While this may not be of much concern now because the first OTC approved contraceptive is still not on the market, this topic is expected to gain attention once that happens.

The drugmaker of the first FDA approved OTC contraceptive pill has indicated that the pill will be available in most major pharmacies nationwide and online starting in the first quarter of 2024.

About Michelle Cammayo, Compliance National Practice Leader, Employee Benefits

Michelle Cammayo has close to 20 years of Employee Benefits experience specializing in all lines of health and welfare benefits. Today, Michelle works closely with clients and partners to provide guidance in areas of the law including ERISA, HIPAA, COBRA, FMLA and PPACA. She is also the IMA National Practice Leader for Compliance and endeavors to ensure IMA helps its clients manage and eliminate risk in the most effective manner. She is passionate about educating others and her passion for this shined in the COVID era where Michelle conducted weekly and then monthly webinars providing guidance to employers. Her podcast, Cammayo’s Compliance Talk, has gained popularity in the last three years to become a favorite amongst our clients. She also contributes regularly to our Blog and has authored several articles for industry-related newsletters. Michelle’s consultative approach with employers provides practical advice as employers endeavor to be compliant.

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