Three federal agencies just opened a flexible new pathway – and the clock starts ticking in 2027
A proposed federal rule would let US employers offer IVF and fertility coverage as a standalone benefit – with a $120,000 lifetime cap.
A proposed federal rule published May 13, 2026 would let US employers offer fertility benefits as a new category of "limited excepted benefits," giving HR a more flexible way to cover IVF, diagnostics, medications, and treatments for underlying reproductive health conditions.
The proposal comes jointly from the Treasury Department, the Department of Labor, and the Department of Health and Human Services. It would carve fertility benefits out from most of the market rules that apply to group health plans under ERISA, the Affordable Care Act, and the Public Health Service Act – the same kind of structural exemption that already exists for limited dental, vision, and long-term care benefits.
The rule traces back to Executive Order 14216, signed by President Trump on February 18, 2025, which made expanding IVF access an administration policy priority.
To qualify as an excepted fertility benefit, coverage has to clear four bars. Substantially all benefits must be for diagnosing, mitigating, or treating infertility or related reproductive health conditions, and substantially all must come from licensed medical professionals. Lifetime benefits per participant must cap at $120,000, indexed for medical inflation for plan years beginning after December 31, 2027. The fertility benefit cannot be integral to the main plan – meaning the employer has to also offer a separate group health plan that participants can decline. And the employer must give workers a written notice spelling out what is covered, what the limits are, how to find a network provider, and how to file a claim.
That notice has to land at or before the first day a participant can enroll, then go out annually and on request. It must be written at or below an 8th-grade reading level.
The reach is significant. The Departments estimate around 522,811 group health plans and roughly 54.4 million eligible employees could be affected, with about 743,361 participants enrolling annually. The estimate is based on data showing roughly 3 percent of plan participants aged 25 to 45 are currently seeking medical care to conceive.
Coverage gaps are part of why the rule is moving now. The Departments cite KFF data showing only about 27 percent of large firms with 200 or more employees currently offer IVF coverage, and roughly 60 percent of employers offer no fertility benefits at all. A single IVF cycle runs $15,000 to $20,000, and successful conception averages 2.5 cycles – pushing total costs above $40,000 for many families.
For HR, the rule would not require employers to offer the benefit, would not set a minimum coverage level, and would not require employers to contribute to premiums. Plan sponsors design the benefit they want.
Self-insured plans get the broadest opening. The rule notes that state IVF mandates – now in 15 states and DC – generally do not apply to self-insured arrangements, which cover more than half of people with private-sector employer-sponsored coverage. Fully insured plans in mandate states may not get the same relief through this pathway.
The proposed effective date is plan years beginning on or after January 1, 2027. The Departments are also asking whether the rule should kick in on the date the final rule is issued, to give employers immediate flexibility.
Three strategic questions are now on HR's desk. Should the company add fertility coverage for the first time? Should existing fertility coverage move out of the main medical plan and into this new structure? And how should HR budget for a benefit where adverse selection – workers timing enrollment to when they need treatment – is a real risk?
Comments are due July 13, 2026. The Departments are explicitly inviting employer input on take-up rates, contribution levels, and whether a lifetime cap or an annual cap with carryover would work better.
This is a proposed rule, not a final one. Employers do not need to act yet – but the planning horizon is short, and the design choices will matter.
