Federal Guidance Reshapes Fertility Benefits Market Strategy

On October 16, 2025, the U.S. Department of Labor, along with the Departments of Treasury and Health and Human Services, issued guidance confirming fertility treatment coverage as an “excepted benefit.” Released as part of a coordinated White House effort, the guidance was announced alongside a pharmaceutical pricing deal and FDA fast-tracking for fertility drugs, which represent a significant federal intervention into fertility treatment policies over the last few years.

This clarification on guidance means employers have the flexibility to offer different benefits, since fertility treatment should look more like dental and vision benefits, rather than traditional healthcare benefits.

Clarifying existing pathways

This guidance gives employers, insurers, and fertility-treatment platforms flexibility to design, market, and manage coverage for fertility services as a separate, modular product. Platforms like Progyny, Carrot Fertility, or Maven Clinic are expected to capitalize quickly by rolling out new partnerships or plan structures tailored to small- and mid-market businesses.

While these pathways aren’t technically new, the guidance confirms three existing options under which employers can offer fertility benefits:

Independent, noncoordinated benefits: Employers can provide fertility coverage through fully insured specified disease or illness policies. These must be separate insurance contracts with no coordination with the employer’s main health plan. These benefits also cannot be self-funded.
Excepted benefit HRAs: Employers can reimburse employees’ out-of-pocket fertility costs through health reimbursement arrangements, but only up to $2,150 per year in 2025.
Employee assistance programs: Employers can offer fertility coaching and navigation services through EAPs, though not actual treatment.

Dr. Shah acknowledged the limitations, noting that "none of this has taken effect yet. They signal direction, they're not necessarily regulation in all cases." He added that "there's still rulemaking that needs to be done and things that need to be formalized, there's a lot of details that are still being worked out."

The departments announced they “intend to propose notice-and-comment rulemaking” to expand these options further, potentially allowing self-funded fertility treatment benefits.

From policy to practice

The guidance, described by the Department of Labor as designed to “cut burdensome red tape”, enables employers to expand access to fertility treatment without changing their core health insurance offerings. The guidance explicitly addresses flexibility in benefit design.

“The kind of flexibility they’re providing is, for example, to provide first-dollar coverage for fertility,” Dr. Shah explained, noting that traditional medical benefits require the patient to meet their deductible.

Market implications

The announcement had immediate market effects. Progyny (NASDAQ: PGNY), the publicly traded fertility benefits management company, initially surged 5% following the announcement. However, the stock fell 9.3% the following day to $19.34.

The real test will be execution: whether vendors and insurers can turn this regulatory flexibility into scalable, measurable products that deliver value for both employers and employees. For vendors, the opportunity lies in developing modular offerings. For employers, it’s a chance to meet growing employee demand for family-building support without overhauling existing health plans.

Currently, only 42% of employers offer coverage for fertility treatment services, 32% cover fertility medications, and 32% cover IVF, according to White House data.

As national attention on fertility access intensifies, this guidance could mark a turning point, redefining how fertility treatment benefits are financed in the United States as they become a more standard workplace offering.