Ruling: Calif. pension fund must offer long-term care coverage to same-sex couples

SACRAMENTO, Calif. — In a major case involving gay rights at CalPERS, the nation’s largest public pension fund has been ordered to offer its long-term care insurance program to same-sex partners of California workers.

A federal judge in Oakland struck down portions of the federal Defense of Marriage Act that have prevented the California Public Employees’ Retirement System from extending the insurance to gay spouses and domestic partners.

In a ruling released Thursday, U.S. District Judge Claudia Wilken said the ban served no “legitimate governmental interest” and was apparently “motivated by anti-gay animus.”

CalPERS hailed the ruling, saying it had wanted to make the insurance plan available to gay couples but its hands were tied by federal law and regulations. About 160,000 state workers have bought long-term care coverage from the agency.

“We have been strongly advocating for the ability to administer our program for same-sex spouses and domestic partners,” said CalPERS Chief Executive Anne Stausboll in a prepared statement.

It’s not clear how soon CalPERS could start offering the insurance to same-sex couples. The Alliance Defense Fund, an Arizona group that opposes gay marriage, said Friday the ruling will surely be appealed. That would keep the existing policy in place for months if not years.

“This will end up at the Supreme Court at some point and we’re confident and hopeful that the law will be upheld,” said Dale Schowengerdt, the group’s legal counsel.

The Bipartisan Legal Advisory Group, an arm of Congress led by Republican House Speaker John Boehner, intervened in the case to defend the existing policy. Lawyers with the group couldn’t be reached for comment.

The ruling is another in a string of recent victories for gay-rights advocates. President Barack Obama ended the military’s “don’t ask, don’t tell” policy last fall, and declared his personal support for gay marriage in early May. Earlier this year, the 9th U.S. Circuit Court of Appeals overturned California’s ban on gay marriage, Proposition 8, although that ruling has been appealed.

With less fanfare, the 16-year-old Defense of Marriage Act, or DOMA, has come under assault. The law, signed by former President Bill Clinton, defines marriage as between a man and a woman.

In early 2011, Obama said his administration would no longer defend DOMA against court challenges. Four months ago, a federal judge in San Francisco struck down a portion of DOMA that prevented a federal-courts employee from getting health coverage for her wife. Earlier rulings also chipped away at portions of the law.

“The trend is now definitely toward district court rulings finding DOMA unconstitutional,” said Doug NeJaime, a professor at Loyola Law School in Los Angeles who studies gay rights cases.

NeJaime said the court ruling in the CalPERS case is particularly noteworthy because it covers registered domestic partners as well as married spouses.

Long-term care insurance covers extended stays in nursing homes, assisted-living centers and similar facilities. Lengthy stays can cost tens of thousands of dollars a year.

Of those companies that offer long-term care insurance to their workers, most extend the coverage to same-sex couples, said Jeremy Pincus, an employee-benefits expert with the Forbes Consulting Group in Lexington, Mass.

Notably, the federal government began offering long-term care coverage to its employees in 2010.

But it’s been unavailable to California state workers. Even though CalPERS extends many other types of benefits to same-sex couples, the pension fund said it couldn’t do the same with long-term care. The insurance benefits are tax exempt under federal law — a status that would have been jeopardized if CalPERS extended coverage to gay couples.

The legal challenge began when Michael Dragovich, a nurse at University of California, San Francisco, Medical Center, tried to buy long-term coverage for his husband, Michael Gaitley, in 2008. The couple wed during the brief window, before Proposition 8 passed, when gay marriage was legal in California.

Dragovich was turned down for the coverage, and two years later became lead plaintiff in a class-action suit against CalPERS and the federal government.

“It all started with my trying to get long-term care insurance for Mike,” an exuberant Dragovich said Friday. “It wasn’t until this got started that I realized how horrible DOMA was.”

Wilken had signaled, in a preliminary ruling in January, that she was going to rule for Dragovich and the other plaintiffs.

“It wasn’t a big surprise given her earlier ruling,” said plaintiffs’ attorney William McNeil III, of the Legal Aid Society’s Employment Law Center in San Francisco.

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