Earlier this year, an Arizona woman whom we’ll call Kelly was completing the paperwork required to get facial feminization surgery. She was diagnosed with gender dysphoria in her teens, and after years of struggling with depression, she decided as a 20-something to transition. Then reality hit fast: The process is expensive, lengthy, and rarely covered by insurance. “So I did what lots of trans people do,” she tells Fast Company. “I got a job at Starbucks.”
Starbucks has covered some types of gender-reassignment surgery since 2012. But in a radical move in 2018, it worked with the World Professional Association for Transgender Health to unveil a supplemental insurance plan that added coverage of procedures “previously considered cosmetic,” such as breast reduction, forehead contouring, calf implants, and hair transplants. With the requisite medical signoffs, Starbucks workers could get many of these procedures with zero deductible and no copay. The LGBTQ website Them called it “the most comprehensive trans health policy in the world.”
But Fast Company has learned through interviews with a number of worried employees and prominent healthcare providers that the supplemental plan’s reach is set to be diluted in September. Aetna, the insurance carrier for this plan, has sent notices about the impending changes to healthcare providers, leaving doctors’ offices rushing to expedite surgeries for patients employed by Starbucks. Meanwhile, Starbucks workers are anxious they’ll be asked to shoulder more of these vital procedures’ costs once the policy changes. Adding confusion, Starbucks says what triggered this change is a new Washington state law championed by LGBTQ activists to make insurance more trans-inclusive. Yet nationwide, Starbucks employees could end up paying out of pocket for gender-affirming care, and losing access to top doctors.
As one worker explained, they’re counting down until September to “learn if the benefit I came to Starbucks to use is still going to exist in time for me to use it.”
Rumors of changes affecting transgender benefits began circulating among trans workers months ago, but Starbucks claims to have been unaware of the outcry or the employees’ concerns. The coffee chain tells Fast Company that trans workers will still be able to get the same procedures covered. “The inclusive transgender medical benefits that we offer our partners are not changing,” a spokesperson says.
What is set to change, however, is which plan covers these procedures—the zero-deductible, no-copay secondary plan, or a primary plan that is likely to include cost-sharing, which would shift a portion of the costs back onto the worker. These costs tend to run very high in the United States. In fact, many U.S. households don’t have enough liquid assets to meet typical private insurance cost-sharing amounts, should they ever need to.
Starbucks declined to elaborate on the record about the shift in coverage, or how the supplemental plan may be affected. Also, baristas’ primary plans are offered by outside insurance carriers, and Starbucks says it is too early to understand how these carriers might adjust those plans to comply with Washington’s law. But trans employees argue Starbucks hasn’t communicated any of this to them, and the situation is leaving them feeling uneasy.
‘Do not wait’
Washington’s new Gender Affirming Treatment Act took effect on January 1, and it bars insurance carriers statewide from classifying gender-confirmation treatment as “cosmetic,” a label that almost always means “not covered by primary insurance” (think common elective plastic surgeries like facelifts, nose jobs, and liposuction). Being Seattle-based, Starbucks told Fast Company its insurance policies originate in Washington and must follow the state’s laws. The company also described the Gender Affirming Treatment Act as a critical step in expanding gender-affirming care, at a time when other states are reducing access. Washington Insurance Commissioner Mike Kriedler has noted that requiring primary insurance plans to cover gender-affirming care will prevent insurers from “be[ing] able to issue blanket denials based on inadvertent loopholes.”
Except baristas and doctors worry an unintended consequence is that this may put Starbucks workers in a more precarious position.
Over the past year, Kelly, who like most workers in this story spoke on the condition of anonymity, has spent hundreds of dollars getting medical evaluations from specific doctors so her surgery would be eligible for coverage under Starbucks’s supplemental plan. However, in April she called her advocate—a liaison, assigned by third-party benefits administrator Alight Solutions, who helps Starbucks workers navigate healthcare-related red tape—for advice after learning that her surgeon had no open appointments until 2023.
“The advocate’s advice was ‘We are telling all trans employees, ‘Get your surgeries done as soon as possible. Do not wait,”” says Kelly.
Starbucks, through a spokesperson, said it wasn’t aware advocates were advising workers to do this. It stressed that conversations between employees and advocates are confidential, but didn’t address why so many employees report getting the same warning from their advocates.
Because Starbucks’s supplemental plan is so good, Washington’s law requiring coverage under a primary plan risks being a step backwards for Starbucks workers. Starting at the end of September, most, or even all, of the trans surgeries covered by Aetna’s prized supplemental plan will move to Starbucks’s primary insurance plans. For years, Starbucks has let employees select their own primary plan based on four national carriers, five coverage levels, and their own budget. They are reimbursed for expenses beyond their plan’s deductible, but the nature of U.S. healthcare is that primary plans introduce into the equation the least-liked aspects of insurance: copays, reimbursement, out-of-network doctors. To get Starbucks’s supplemental plan to cover a procedure, the company requires workers to first attempt to go through their primary plan carrier, which, in the past, has responded with a denial-of-coverage letter that workers must present to Starbucks to activate the secondary coverage. Trans employees fear a yes from their primary plan will create a massive disparity in healthcare access compared to the generous secondary plan.
“I make $15 an hour,” Kelly explains. “Where am I going to find $50,000 to have reimbursed?”
“If the changes go into effect the way Starbucks advocates predict,” says another worker who was ready to schedule a surgery until they heard the bad news from both their advocate and two different surgeons’ offices, then “I would have to pay a $5,000 deposit to book the appointment, and then two weeks before the surgery, I would be responsible for the total surgery fees”—up to $40,000 under their current primary plan, according to this worker.
It’s an open question how Washington’s law will affect corporate insurance plans’ day-to-day billing, but in Starbucks’s case there is also a question of in- and out-of-network providers. Gender-affirming procedures aren’t just technically difficult, but also a niche skill. Starbucks’s supplemental plan has allowed trans employees to pay next to nothing to see almost any doctor they want in the country, including world-class practitioners like Caitlyn Jenner’s doctor Harrison Lee, and Kyle Keojampa, one of the globe’s busiest craniofacial surgeons. Workers tell Fast Company that their advocates and doctors have both warned that a switch to the primary plans from Aetna’s supplemental plan could put top surgeons out of network. (Aetna didn’t respond to multiple requests for comment.)
Reached by phone, a representative for Harrison Lee said, “We still don’t know what is going on, besides that primary insurance will soon cover these procedures, which is why Starbucks’s supplemental plan won’t be in play.” Keojampa’s office, which chooses not to accept primary insurance, noted that beyond the cost-sharing this entails, workers may end up with a smaller list of in-network surgeons who have less experience, particularly in certain regions, for procedures that are complex and high risk. That possibility doesn’t sit well with trans critics of America’s healthcare system.
Most trans people know somebody who’s had a botched surgery, argues Emma Pines, an ex-barista in Utah who paid a few thousand dollars (mostly travel costs) to get an $80,000 procedure done with Keojampa. “Having a jacked-up face isn’t just about your relationship to yourself in the mirror,” she adds. “You gotta wear that into job interviews and meeting your girlfriend’s parents and everything—forever.” She has a degree in social work, but joined Starbucks for the health benefits after six years in that field.
Confusion and uncertainty abound
In total, eight baristas in five states told Fast Company that they’ve been warned to expedite all procedures intended to alter secondary sex characteristics, the ones least-covered by primary insurance plans. “If you ask the advocates, they will say, ‘We don’t know why. We just know it’s changing,'” says Amber, who spent three years at a store in the Southwest, got fired three months before a gender-affirming surgery this winter, then married a coworker, which meant their coverage didn’t lapse. But then Amber called their advocate: “Unprompted, my representative just brought up, ‘Hey I don’t know why, but they’re probably not going to cover electrolysis anymore.'” Another worker in Missouri told me their advocate has simply stopped responding to questions except to say, “Call back in August.”
Fast Company tried to speak with an advocate by calling the toll-free number given to Starbucks workers, but an agent hung up both times.
Kelly, the Arizona worker, predicts many trans workers will be out of luck if some of their most expensive care gets moved into a standard insurance plan with cost-sharing. “If you’re in an online gender-affirming surgery group,” she says as context, “every week you probably see a thread like ‘I’ll never afford surgery.’ ‘Try Medicaid.’ ‘My state won’t cover it.’ ‘Then get a job at Starbucks.'”
Jamison Green, one of the country’s most prominent trans activists and a former president of WPATH, says “it would be devastating” if Starbucks rolled back the supplemental plan. Prior to the plan’s rollout in 2018, Green advised Starbucks on what care to deem medically necessary. Back then he praised Starbucks for being “not afraid” to “demand that people get the best possible care.” Now, he tells Fast Company that the coffee retailer “should take a close look at their rationale for what they’re doing, and make public why they’re doing it.”
(Starbucks had no comment when asked to respond.)
Green adds that contrary to claims, trans patients don’t necessarily cost more to insure. Employers have reported that gender-affirming healthcare benefits incur very low costs and have low employee utilization rates. In one early 2013 survey, 85% reported the costs were zero, while the Human Rights Campaign says it’s less than 3.5% today for most. Though Starbucks covers more costs than most employers do with its supplemental plan.
Data on trans workers is sparse to begin with, and harder still to find for an individual employer. Starbucks publishes statistics on workforce diversity, but only asks about race and gender (either male or female). A study published this month found the number of Americans who identify as trans or nonbinary is much higher than previously thought—Pew Research found it was 5% of adults under age 30, Starbucks’s primary worker demographic. Last month, a report from UCLA’s Williams Institute found that nearly 1 in 5 people today who identify as transgender are between 13 and 17, double the institute’s previous estimate.
Starbucks maintains that it tries to inform employees of major policy changes in advance, and is constantly working to protect and improve the benefits it offers. Last month, after the Supreme Court draft opinion that would overturn Roe v. Wade leaked, it said it would start covering travel costs for abortion and gender-affirming care if an employee wasn’t within 100 miles of those services. But the company hasn’t yet addressed the potentially devastating cost-sharing shift in trans care with employees. On its end, Starbucks doesn’t currently appear to be considering preventative measures, such as trying to adjust the protocol for triggering secondary coverage, or creating a copay coverage pool with the money previously spent on procedures under the supplemental plan. The company declined to get more specific about its upcoming plans.
Doctors also say they don’t understand the imminent changes well enough yet to properly advise Starbucks workers as patients. Kyle Keojampa’s office told Fast Company that it heard Starbucks’s plan is changing because of Washington’s new law, but added it will be fall before the nuances are fully appreciated. “We will see in October how it changes,” a representative tells me.
The Washington State Insurance Commissioner’s Office wasn’t aware that Starbucks’s out-of-state insurance plans were even being affected, but a spokesperson added in a statement that, nonetheless, “It would be interesting to hear why they provided it for free and now they’re asking their employees to pay a portion.”
The insurance coordinator for another top practice in Seattle added that this problem isn’t occurring with other Washington-based companies’ trans health plans—like Boeing’s through Blue Cross Blue Shield, or Microsoft’s or Amazon’s. “There is absolutely a haste from [Aetna’s Starbucks case managers] to get requests processed as fast and with as much coverage as possible,” the coordinator tells Fast Company.
About a quarter of this practice’s facial-feminization patients are Starbucks workers, and the signals coming from Starbucks corporate are “very ominous,” the coordinator contends, adding that while employers must provide access to gender-affirming care, Starbucks might be looking for “other ways to make the process of getting things covered as painful as possible.”
This, naturally, is fueling the fire of the unionization fight at Starbucks that has received much national attention, including last week’s report by Bloomberg that Starbucks is warning that trans-inclusive benefits could disappear from stores that vote to unionize. In letters to Seattle, dozens of organizing committees at stores have said the need to unionize stems partly from Starbucks’s failure to address marginalized workers’ needs, despite espousing a corporate mission to “hold ourselves accountable” to create a “welcoming third place, where every individual is treated with humanity, dignity, and respect.”
Pro-union trans workers describe enduring verbal harassment from customers and coworkers, being passed over for promotions, and—in one incident that caused the National Labor Review Board to accuse Starbucks of unfair labor practices—being threatened with the loss of gender-affirming benefits for supporting unionization. Starbucks has denied this is true.
In an attempt to address transphobic comments, one worker in Arizona told Fast Company he requested less time in customer-facing roles, but was told that wasn’t an option. Crystal, a Kansas worker who says healthcare is “the only reason most trans women, myself included, go to work for Starbucks,” says her store manager has a habit of misgendering staff, then excusing it by saying, “Sorry, I’m old.”
The work environment has given many of these workers a jaded view of Starbucks’s motives—a view seconded by Cassius Adair, a transgender studies scholar at the New School in New York City who is writing a book about trans issues in the U.S. workplace. Starbucks Workers United, the group helping stores organize, says many of the workers leading store union drives are trans, nonbinary, disabled, or from other marginalized groups. Adair wonders if Starbucks, guided by interim CEO Howard Schultz’s unabashedly anti-union stance, has developed a sort of progressive buyer’s remorse. Starbucks was a pioneer in giving these workers benefits, but the last two years have left a growing number disgruntled.
Several trans workers told Fast Company that they’ve gone from feeling proud to work for a brand that staked its reputation on caring for employees to feeling like progressive marketing props. “Starbucks goes, ‘Aren’t we good, we help these poor people,'” says Adair, “but when those poor people suddenly want more than a job and demand dignity at work, does Starbucks see them as a threat?”
Meanwhile, other companies are catching up on the trans-health front. Green mentions that Accenture, JPMorgan Chase, and even Netflix, despite its recent row over trans workplace inclusivity, broadened access to trans benefits for their U.S. workers. Meanwhile, 66% of Fortune 500 companies are now recognized as having trans-inclusive benefits by the Human Rights Campaign’s Corporate Equity Index, its tool for rating workplaces’ LGBTQ friendliness. It gives McDonald’s, Shake Shack, and Starbucks all ratings of 100, a score that means the employer “fully affirm[s] healthcare coverage for medically necessary transition-related care,” though employee cost-sharing isn’t factored in. Starbucks’s supplemental plan remains exceptional in this regard.
Believing the plan’s future is now in doubt, multiple trans workers argue Starbucks’s corporate behavior has crossed another line. “The only staff who will stay at our store are queer and trans partners,” says Crystal. “Why is that? Why does everyone else quit? Because they don’t need to work at Starbucks.”
She continued: “But that isn’t progressive—it’s predatory. And I’m going to be honest with you, I’m not grateful for it anymore. Even on the off-chance that one day I wake up and my brow bone and jawline are fixed and I have the Siren to thank for it, I won’t be grateful. I’ve dealt with too much.”