The Fine Print of New York’s New Surrogacy Law

Is surrogacy legal in New York?

Beginning February 2021, compensated gestational surrogacy will be legal in New York pursuant to the FY 2021 New York State Budget, recently passed by the New York legislature and approved by Governor Cuomo amidst combatting the nation’s largest coronavirus outbreak.  The 2021 budget includes the Child Parent Security Act (“CPSA”), which among other things legalizes compensated gestational surrogacy, streamlines the surrogacy parentage process, and also structures requirements for New York citizens who turn to surrogacy to build their family.  The long-held ban and criminalization of compensated gestational surrogacy, where a surrogate is not related to the child she is carrying for the intended parents, will be overhauled and modernized by the CPSA.  Soon, New Yorkers can freely enter into compensated gestational surrogacy contracts.

The History of Surrogacy Law in New York

Being one of the few states left in the country that forbade compensated gestational surrogacy, New York’s stringent prohibition stemmed largely from the 1980’s landmark “Baby M”[1] case.  The surrogate in Baby M agreed to be a traditional surrogate, where the surrogate uses her own genetic material and is related to the child she is carrying for the intended parents.  The traditional surrogate in Baby M changed her mind during the pregnancy and refused to give custody of the baby to the intended father upon birth.  Baby M sparked jurisdictions nationwide to pass laws that restrict, prohibit, or criminalize the act of traditional surrogacy, New York being one of them.  Even though traditional surrogacy dates back to Babylonian times, gestational surrogacy has largely been considered best practice throughout the United States since Baby M.  Unsurprisingly, New York’s new surrogacy law has kept the provisions criminalizing traditional (genetic) surrogacy, while permitting and heavily regulating compensated gestational surrogacy.  This is certainly a step in the right direction for New York and will provide a path to parenthood for modern families; however, the CPSA does pose some limitations.

The Surrogates Bill of Rights

The CPSA provides strong protections to surrogates and touches on virtually every aspect of a gestational surrogacy arrangement, and then some—from requirements pertaining to surrogacy agencies, contracts, compensation, and escrow to guidelines for obtaining parentage orders and the effect of embryo disposition agreements between intended parents.  Included in the CPSA is a “Surrogates Bill of Rights,” designed to ensure that surrogates have continuous support and more protections throughout the process than the general baseline protocols of an ethical surrogacy journey.  It provides surrogates with enumerated rights, such as the right to make her own health and welfare decisions, the right to have independent legal counsel, the right to have health insurance, counseling, and life insurance, the right to be reimbursed for medical expenses, and more.

What Intended Parents Need to Know About Surrogacy in New York State

These powerful surrogate protections are a great notion, but intended parents must pay the price tag unless a surrogate who agrees to an uncompensated compassionate gestational surrogacy waives that requirement.  While it does not set a minimum amount for surrogate compensation (but it must be “reasonable”), the bill of rights requires intended parents to pay for a comprehensive health insurance policy for their surrogate, and a life insurance policy for their surrogate that provides a minimum benefit of $750,000 (or the maximum amount if the surrogate qualifies for less).  Both policies must be for a term that begins prior to the start of an embryo transfer cycle and extends for twelve months after the surrogate gives birth.  Considering the fact that not all embryo transfers are successful on the first embryo transfer attempt, these policies could potentially extend for several years.  Health insurance and life insurance policies for a surrogate are an expected cost for intended parents, but usually not for that amount and for that duration.

While the CPSA’s comprehensive regulation is understandably geared toward surrogate protections, there is a concern that New York intended parents may be dissuaded.  Most states do not have laws that require insurance coverage for infertility treatment and the entire process is very expensive, potentially costing up to a few hundred thousand dollars.  Implementing these regulations will increase that cost for New York intended parents.

How Are Intended Parents Protected Under New York Surrogacy Law?

Nonetheless, the CPSA undoubtedly helps intended parents too.   Even though not effective until the baby is born, New York intended parents will be able to obtain a parentage order declaring them legal parents before birth while the baby is in utero.  And this streamlined process will benefit any intended parent, regardless of whether they utilize an egg or sperm donor and regardless of whether they are a same sex couple.  In fact, the law is so inclusive that an intended parent who is legally separated, or who has been living separate and apart from his or her spouse for at least three years, can enter into an enforceable surrogacy agreement without his or her spouse.  All things considered, even though the CPSA regulations will up the cost for intended parents, the price tag is worth having such comprehensive legal protections and peace of mind throughout the surrogacy journey.

Does New York Require You Use a Surrogacy Agency?

Notably, though, the regulations of the CPSA are broad.  The regulations do not prohibit independent surrogacy journeys, but both surrogates and gestational carriers should strongly consider using a competent agency (required by the CPSA to be licensed and registered in New York) to navigate the process and ensure that all requirements are met.  In summary, the CPSA criteria does present limitations, but upending the over 30-year ban on surrogacy to bring New York up to speed with modern family building is a major feat.

Do you have additional questions about the new surrogacy law in New York state? Contact Chelsea Caldwell, our Director of Legal Services at

Questions about surrogacy law in a state other than New York? Visit our US Surrogacy Law page, and click on your state to see the most up-to-date laws regarding surrogacy ans egg donation.

 

[1] In re Baby M, 537 A.2d 1227 (1988).

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