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The Baby Business Boom: Navigating the Surrogacy Regulatory Landscape in the United States

By Samantha Tonini

Edited by Saniya Koppikar, Colin Crawford, and Vedanth Ramabhadran


During the 21st century, surrogacy rates in the United States have surged significantly, with a remarkable 372.32% increase from 1999 to 2013, as reported by the CDC [1]. This surge can be attributed to several factors, including the advancement of in vitro fertilization (IVF) technology and the growing trend of mothers conceiving at later ages, leading to increased fertility challenges. Paired with an expanding array of fertility treatment options and evolving social norms, surrogacy has emerged as a valuable path to parenthood, reflecting  not only the profound shifts in modern family planning but also the challenges many individuals and couples face in their journey towards parenthood. As more individuals choose to start families later in life, the natural challenges related to fertility have become more prevalent. In turn, assisted reproductive technologies such as IVF have advanced significantly, providing new avenues for individuals and couples seeking to have children. 

It is important to recognize that surrogacy serves as a means to parenthood for various groups, including heterosexual couples facing infertility, homosexual couples, and single individuals. This inclusivity mirrors the broad spectrum of family structures in modern society. To navigate the intricate world of surrogacy, two critical categorizations come into play: the nature of the relationship between the intended parents and the surrogate, and the genetic connection to the baby [2]. These classifications significantly influence the dynamics and agreements within the surrogacy process. Altruistic surrogacy, for instance, involves a pre-existing relationship between the intended parent(s) and the surrogate, who is often a friend or family member who carries the baby without additional compensation beyond medical expenses [2]. Commercial surrogacy, on the other hand, entails intended parents seeking a surrogate through an agency [2]. Regarding genetic makeup, surrogacy can be either full/gestational or partial/traditional. In full surrogacy, the surrogate lacks genetic ties to the baby, as the intended parents provide the sperm and egg, personally or from donors. In partial surrogacy, the surrogate's own eggs are used [2]. Additionally, the genetic connection to the child plays a fundamental role in the surrogacy journey. Full surrogacy, also known as gestational surrogacy, implies that the surrogate has no genetic ties to the baby, as the intended parents provide the sperm and egg [2]. In contrast, partial surrogacy involves the use of the surrogate's own eggs [2]. This genetic distinction shapes the relationship dynamics and, to some extent, the legal and emotional complexities that may arise during the surrogacy process. Regardless of the classification, key characteristics must remain in order for the process to be considered surrogacy: another woman must be inseminated, carry the child, and receive compensation or financial support from the intended parents for her time, effort, and related medical expenses. The numerous facets of surrogacy reveal the spectrum of diverse options available to individuals and couples with various needs, preferences, and circumstances. Altruistic surrogacy, often involving a pre-existing relationship, reflects the deep personal commitment between the surrogate and the intended parents [3]. Commercial surrogacy, however, offers an avenue for those who do not have an established connection with a potential surrogate [3]. Nevertheless, a common thread across all surrogacy categories is the essential principle that characterizes surrogacy: the involvement of a woman who carries the child and receives compensation or financial support for her selfless dedication, encompassing her time, effort, and associated medical expenses from the intended parents. This shared commitment represents the foundation of surrogacy and underlines the significance of ensuring that the process serves the best interests of all parties involved. 

While surrogacy has gained widespread acceptance as a viable means of building families, the landscape of rights and regulations surrounding this practice in the United States remains fragmented. The tortuous web of surrogacy laws within the United States is largely due to the delegation of authority to the states, governed by the 10th Amendment, which reserves powers not explicitly assigned to the federal government to the states [4]. Consequently, the diversity of laws regarding surrogacy across the nation has given rise to a legislative patchwork. Presently, three states—Michigan, Louisiana, and Nebraska—have taken the extreme step of outlawing commercial surrogacy altogether [5]. Restrictive laws govern the practice in many other states, such as Indiana and Nebraska, imposing limitations related to qualifications or compensation for surrogates [5]. In contrast, some states’ stances are ambiguous, having yet to establish clear regulations. A distinct category of states led by California is hailed as surrogate-friendly, with surrogacy contracts granted legal recognition, ensuring their binding nature within the judicial system [5]. California's pioneering stance has been echoed by seven other states and districts, including Connecticut, D.C., Delaware, Maine, New Jersey, Oregon, and Pennsylvania, fostering a favorable environment for surrogacy arrangements [5]. By providing a predictable and secure surrogacy-supportive legal framework, this cluster of states has attracted the business of surrogates and intended parents alike; however, the clustering abandons a significant portion of the United States to less favorable surrogacy conditions, compelling those residing in states with limited or adverse regulations to seek services across state lines. This geographical disparity underscores the need for a comprehensive national legislative framework addressing the custody of surrogate children and securing the rights of all parties involved, including surrogates, intended parents, and the children born through these arrangements. Such legislation would provide uniformity and consistency in the treatment of surrogacy cases across the nation, promoting fairness and clarity in this intricate and emotionally charged process.

The absence of comprehensive national regulations leaves surrogates, especially commercial surrogates, physically vulnerable. These women place their bodies, and potentially their lives, at risk with the expectation of compensation and coverage of their medical expenses. Contracts, typically drawn up by surrogacy agencies, outline issues like compensation and medical emergencies. Unfortunately, most states do not legally recognize these documents. Problems then emerge as intended parents are unable to cover unexpected expenses or altogether withdraw from the process post-insemination. Often, the latter occurs upon discovering the surrogate is carrying multiple children or that the child will have mental or physical challenges. Intended parents may feel that the child doesn't meet their expectations, leaving the surrogate without payment and responsible for a child they didn't intend to raise, and to whom they may not be genetically related. This dilemma forces the surrogate to decide whether to take custody or place the child in the foster care system. A notable case in Connecticut involved surrogate Crystal Kelly, who chose not to abort a baby with Down Syndrome after the intended parents requested the procedure [6]. As the baby was not genetically related to her, it would have ended up in foster care if not aborted. Kelly decided to raise and adopt the child. She expressed her shock at the intended parents' request to abort, as the surrogacy contract explicitly stated that they couldn't back out once she was pregnant. However, if these contracts aren't legally binding in all courts, the intended parents may not be held accountable.

The issue of accountability primarily stems from the absence of legal recognition of surrogacy contracts and a lack of screening for intended parents. When individuals adopt, they must undergo a rigorous and comprehensive evaluation to assess their suitability for raising a child. This evaluation encompasses various aspects, including income, residence, medical history, criminal records, and more. The specific qualifications for adoptive parents differ from state to state. According to the Texas Family Code, the fundamental criteria for assessing prospective adoptive parents include:


  1. A personal interview of each party to the suit seeking conservatorship of, possession of, or access to the child;

  2. Interviews, conducted in a developmentally appropriate manner, of each child who is the subject of the suit who is at least four years of age during a period of possession of each part to the suit but outside the presence of the party;

  3.  Observation of each child who is the subject of the suit, regardless of the age of the child, in the presence of each party to the suit, including, as appropriate, during supervised visitation, unless contact between a party and a child is prohibited by court order or the person conducting the evaluation has good cause for not conducting the observation and states the good cause in writing provided to the parties to the suit before the completion of the evaluation;

  4. An observation and, if the child is at least four years of age, an interview of any child who is not a subject of the suit who lives on a full-time basis in a residence that is the subject of the evaluation, including with other children or parties who are subjects of the evaluation, where appropriate;

  5. The obtaining of information from relevant collateral sources, including the review of:

  6. Relevant school records;

  7. Relevant physical and mental health records of each party to the suit and each child who is the subject to the suit [7]


In contrast to the rigorous screening process imposed on prospective adoptive parents, the path to becoming intended parents through surrogacy lacks a comprehensive framework to both safeguard the surrogate and ascertain the willingness and capability of intended parents to meet all financial responsibilities, including unexpected ones, and to provide care for the child at the pregnancy's end. Instead, the determination of who qualifies for the surrogacy process is left to individual agencies, with very few state laws addressing the qualifications required for intended parents. Virginia is an exception, offering a parental fitness check that ensures parental rights for the intended parents upon the child's birth [8]. Nevertheless, many intended parents in Virginia opt for a less time-consuming and costly approach by waiting until after the child is born and then filing a Surrogate Consent and Report Form to secure custody [8]. For those encountering barriers in their state, an alternative is to seek a surrogate in a more permissive state. With most surrogacy agencies, one typically needs to provide basic information about one’s name, residence, and current stage in the surrogacy process, including whether one is working with a fertility clinic and has already created embryos [9]. Following this, one undergoes an interview with an agency representative, and if deemed a suitable fit, is placed on the waiting list. Subsequently, there are minimal to no check-ins to assess the fitness of the intended parents. The regulation, or the lack thereof, is predominantly determined by the agencies that stand to profit from prospective parents and customers. Enhanced regulation, akin to the stringent checks in adoption procedures, would not only alleviate concerns regarding the fitness of the intended parents but also offer greater protection for surrogates, assuring them of payments and the child being properly cared for.

When establishing a child's parentage, three primary factors come into play: the child's genetic makeup, the gestational carrier, and the intent of the parties involved. The legal framework for determining parentage often relies on the Uniform Parentage Act, which “provides states with a uniform legal framework for establishing parent-child relationships” [10]. However, not all states have adopted this legislation, and many of those that have adopted it still use an older version, placing prospective parents at a disadvantage. The most recent revision occurred in 2017, prior to which it was last updated in 2002. Only seven states have enacted the 2017 version, including California, Washington, Colorado, Connecticut, Rhode Island, Vermont, and New York, while fourteen states still adhere to the older version [11]. This distinction is crucial, particularly because the 2017 version introduced several changes, including those pertaining to surrogacy. Section 801 of the 2002 version states that a surrogate, her husband (if applicable), and the intended parents can enter into an agreement if...


(1) the prospective gestational mother agrees to pregnancy by means of assisted reproduction; 

(2) the prospective gestational mother, her husband if she is married, and the donors relinquish all rights and duties as the parents of a child conceived through assisted reproduction; and 

(3) the intended parents become the parents of the child. 

(b) The intended parents must be married, and both spouses must be parties to the gestational agreement. 

(c) A gestational agreement is enforceable only if validated as provided in Section 803. 

(d) A gestational agreement does not apply to the birth of a child conceived by means of sexual intercourse. [10]


These requirements create several issues regarding parentage, particularly in terms of who can qualify for surrogacy and the legal claims of surrogates in cases of partial surrogacy. This section effectively disqualifies heterosexual couples who cannot use their own eggs or sperm, homosexual couples, unmarried couples, and single individuals from being legally recognized as parents. While this doesn't prevent these groups from engaging in surrogacy within states that have only enacted the 2002 UPA, it significantly increases the likelihood of legal complications in cases of disputes between the intended parents and the surrogate. These complications can arise both in the hospital when declaring parental status on the birth certificate and during potential legal disputes, and becomes particularly challenging when a couple opts for partial surrogacy. Since the genetic makeup and gestation of the child play critical roles in determining parentage, the use of the surrogate's own eggs can potentially lead to her being granted custody of the child, even against her wishes. This scenario can escalate into an unwanted custody battle that further complicates the situation. In the 2017 UPA revision, gendered language was removed to ensure inclusivity of homosexual couples, responding to the Supreme Court's ruling in Pavan v. Smith [12]. In this case, two married lesbian couples took legal action against the state of Arkansas . Both couples had undergone IVF with sperm donors, with one wife from each couple carrying the babies. However, upon the birth of the babies, only the carrying wives were listed on the birth certificates, leaving the babies with just one parent legally recognized. In June 2017, the Supreme Court ruled this practice unconstitutional, as it violated the principles established in Obergefell v. Hodges, which deemed discrimination against homosexual couples unconstitutional [13]. It's important to note that because Pavan and Obergefell are federal laws, they do not apply to surrogacy, which, as previously mentioned, falls under the jurisdiction of individual states. Instead, states like Tennessee have laws that actively make declaring custody more challenging for anyone who chooses to have a traditional surrogacy, or if they are a homosexual couple as established in the case In re Adoption of Male Child A.F.C., where the state declared that if either the surrogate  or a third party uses an egg donor, the second parent, either the intended mother or the second father, must go through the adoption process to gain custody once the child has been born [14]. 

States that have embraced the 2017 UPA exhibit significantly improved surrogacy laws with more inclusive language, which rectifies previous issues faced by certain groups excluded from the 2002 version. Even with these positive changes, however, it's essential to note that custody is not automatically ensured for parents engaging in partial surrogacy arrangements. In fact, the 2017 UPA explicitly grants the surrogate the right to dissolve the contract, assert custody of the child, and receive compensation as stipulated in the contract agreed upon by the surrogate and the intended parents [15]. This is explicitly outlined as follows:


A genetic surrogate who is a party to the agreement may withdraw consent to the agreement any time before 72 hours after the birth of a child conceived by assisted reproduction under the agreement. To withdraw consent, the genetic surrogate must execute a notice of termination in a record stating the surrogate’s intent to terminate the agreement. The notice of termination must be attested by a notarial officer or witnessed and be delivered to each intended parent any time before 72 hours after the birth of the child.


These regulations grant genetic surrogates the authority to void the contract and demand custody of the child within a window extending up to 72 hours following the child's birth. This situation leaves intended parents exceptionally vulnerable in the event that the surrogate experiences a change of heart, which is a scenario most likely to transpire once the baby is born. Moreover, intended parents are further exposed to risk given that the UPA specifies that they remain obligated to furnish the agreed-upon financial compensation, despite losing custody. The UPA states… 


(b) On termination of the genetic surrogacy agreement under subsection (a), the parties are released from all obligations under the agreement except that each intended parent remains responsible for all expenses incurred by the surrogate through the date of termination which are reimbursable under the agreement. Unless the agreement provides otherwise, the surrogate is not entitled to any non-expense related compensation paid for serving as a surrogate.


(c) Except in a case involving fraud, neither a genetic surrogate nor the surrogate’s spouse or former spouse, if any, is liable to the intended parent or parents for a penalty or liquidated damages, for terminating a genetic surrogacy agreement under this section. [15] 


According to these sections, intended parents not only face the potential loss of their anticipated child but also the obligation to compensate the surrogate for any financial commitments outlined in the contract up until the point of contract termination. However, it is crucial to note that these regulations apply exclusively to states that have enacted the 2017 UPA. In states where earlier or no versions are in effect, intended parents may find themselves with even less protection concerning child custody.

California stands out as a state with the most protective laws for intended parents, largely due to the influential case of Johnson v Calvert in 1993 [16]. In this case, Anna Johnson served as the gestational surrogate for Mark and Crispina Calvert, and each signed a contract indicating that Anna would "relinquish all parental rights" to the baby [16]. However, disputes arose between the two parties, leading Johnson to express her intent to claim custody of the child while six months pregnant [16]. The Calverts responded by filing a lawsuit, asserting their legal parental rights [16]. At that time, under the UPA in effect, motherhood was determined by both genetics and gestation, which meant that, in the eyes of the California Courts, Johnson and Crispina Calvert had equal claims to motherhood. Consequently, California ruled that, in surrogacy cases, the intent of the involved parties, as outlined in the original contract, held the greatest significance. This emphasis on intent persists in California, even in cases of partial surrogacy. However, this is only possible because California treats surrogate contracts as legally binding documents admissible in a court of law. Therefore, in states where such contracts lack legal recognition, intended parents are exposed to the risk of losing custody. Historically, parents opting for traditional surrogacy face the greatest risk, given that these surrogates have a stronger chance of obtaining custody if the contract is not deemed binding, due to genetic ties with the child and carrying the pregnancy. If the determination of parentage does not consistently hinge on intent, many intended parents remain vulnerable.

In the majority of surrogate cases, courts aim to place the child in the home of the rightful parent, with the parent's fitness often playing a role in this determination. This was prominently illustrated in the California case of Cook v. C.M., where the surrogate, Melissa Cook, contested the fitness of the intended father, known only as C.M., to raise the three babies she was carrying. C.M., a single deaf man residing in his grandparent's basement, encountered financial difficulties early in the pregnancy [17]. Upon learning the details of his living situation, Cook filed a lawsuit in an attempt to gain custody of the children. However, the courts ruled in favor of C.M., asserting that Cook had no legal grounds for custody based on the surrogacy contract. Enhancing parental fitness assessments before allowing individuals to enter into surrogacy contracts serves a dual purpose [17]. It not only safeguards the surrogate, ensuring she receives her agreed-upon payments and is not left with an unwanted child but also ensures that the child is placed in a suitable home. This aligns with the objectives of adoption home assessments, and surrogacy should be no exception.

Selective reduction is a contentious method of child protection in the realm of surrogacy, as it essentially involves a form of abortion, a deeply debated topic in the United States. Due to the absence of comprehensive regulations in the surrogacy process, there are no limitations on the number of embryos that can be inseminated in a surrogate. This practice is aimed at increasing the chances of a successful pregnancy in a single insemination attempt, thereby saving time and money. Usually, a single embryo successfully implants, leading to a pregnancy with a single fetus. However, there are instances where multiple embryos implant in the uterus. This is a major factor contributing to surrogates and individuals who undergo in vitro fertilization (IVF) having a higher likelihood of multiple pregnancies, with a well-known example being Nadya Suleman, the "Octomom," who gave birth to octuplets after being inseminated with 12 embryos in 2008.

While some might initially view this as a miraculous development — enabling parents who cannot conceive on their own to potentially have multiple children — the reality is often quite different. Many intended parents may insist that their contract only covers one child, potentially leaving the surrogate with the additional babies, thus putting the surrogate at risk once more. The more substantial risk, however, pertains to the health of these fetuses, who are attempting to grow and develop with significantly less space and fewer nutrients than they would typically receive in the womb. With each additional fetus, the pregnancy becomes increasingly complex and dangerous, and the chances of the fetuses surviving to birth decrease dramatically. Those that do survive are likely to experience some form of mental or physical disability due to the limited resources in the womb.

Given these risks, doctors often recommend selective reduction, which involves the selective abortion of some fetuses to increase the chances of survival for the remaining ones. The legal landscape for selective reduction has been complicated by the Dobbs v. Jackson case in 2022, which overturned the precedent that abortion was federally protected, thereby leaving the regulation of abortion up to the states [18]. While many states, particularly in the South, have enacted stringent abortion laws, few of them explicitly address cases of selective reduction, resulting in legal ambiguities in certain states. In many cases, selective reduction may be considered entirely illegal, despite the potential risks to both the fetuses and the surrogate. Therefore, the issue becomes even more complex when considering that selective reduction is part of the broader and highly debated abortion discourse in the United States. Nevertheless, there should be clear guidelines in place for surrogacies involving multiple fetuses in states where abortion is legal. Should the decision regarding reduction be left solely to the intended parents, who will be taking the children home? Or should the surrogate have a say in this critical matter, given the risks she will face as she carries the children? In states where abortion is illegal, regulating the insemination process could reduce the likelihood of requiring selective reduction. However, this would extend the surrogacy process and increase its cost, as doctors cannot guarantee which embryos will successfully implant and lead to a pregnancy.

In an era where assisted reproduction technologies are rapidly gaining prominence in the United States, it is of paramount importance that we take proactive steps to bridge the regulatory gap that currently surrounds surrogacy. The exponential growth of surrogacy arrangements, while providing an invaluable pathway to parenthood for countless individuals and couples, has also brought to light various complex issues that demand  immediate attention. The absence of comprehensive federal guidelines and national regulation leaves both surrogates and intended parents exposed to legal, financial, and emotional risks throughout the surrogacy process. Surrogacy contracts, which are not nationally recognized as legally binding, can potentially result in the loss of a child a person believes they have custody of. Mandatory parental checks are conspicuously absent, jeopardizing the well-being of surrogates and unborn children, with no assurance that prospective parents are financially capable or suitable to raise a child. Additionally, the lack of clear guidelines concerning selective reduction or decision-making processes places unborn children in precarious situations with potentially life-altering consequences. The federal government has historically delegated matters of assisted reproduction to the states, but surrogacy stands apart as a unique commercial enterprise. Unlike adoption, surrogacy involves an exchange of goods and services, subject to federal regulation under the Commerce Clause. This clause grants the federal government the power to regulate interstate commerce, which encompasses the trade of goods and services, like surrogacy, between states [19]. With an interstate exchange occurring, federal oversight becomes not only practical but necessary. 

As the demand for surrogacy services continues to grow, the onus is on us to establish federal guidelines that offer comprehensive protection for surrogates, intended parents, and, most importantly, the children born through these arrangements. To achieve this, we must advocate for clear regulations that address the rights and responsibilities of all parties. These regulations should include protections for surrogates to ensure they receive the agreed-upon compensation and do not bear the undue burden of childcare. They should also provide legal clarity to intended parents, securing their rights and responsibilities as legal guardians. By taking these steps, we can bridge the regulatory gap surrounding surrogacy and ensure the well-being, security, and future of everyone involved in the surrogacy process.

 

[1] National Center for Chronic Disease Prevention and Health Promotion Division of Reproductive Health, What Is Assisted Reproductive Technology?, CDC, Oct. 8, 2019, https://www.cdc.gov/art/whatis.html.


[2] Krista Thompson, Boss Mom: Why Texas Should Revise Its Legislation to Allow Gestational Surrogacy Contract Enforcement for Social Surrogacies, 75 SMU L. REV. 973, [976] (2022). https://scholar.smu.edu/cgi/viewcontent.cgi?article=4944&context=smulr


[3] Alicia Gonzalez, Commercial Surrogacy in the United States, 21 GEO. J. GENDER & L. 1 (2019), https://www.law.georgetown.edu/gender-journal/wp-content/uploads/sites/20/2019/11/Alicia_Surrogacy-6.pdf


[4] 10th amendment, Constitution


[5] Surrogacy Laws by State, Giving Tree Surrogacy, 2024, https://www.givingtreesurrogacy.com/resources/surrogacy-laws-by-state.


[6] Elizabeth Cohen, Surrogate Offered $10,000 to Abort Baby, CNN Health, Mar. 6, 2013, https://www.cnn.com/2013/03/04/health/surrogacy-kelley-legal-battle/index.html.


[7] 5 T.F.C. § 107.153


[8] Gestational Surrogacy in Virginia, Creative Family Connections, https://www.creativefamilyconnections.com/us-surrogacy-law-map/virginia/.



[10] Uniform Parentage Act (UPA) § 5, 801, §9814


Krista Thompson, Boss Mom: Why Texas Should Revise Its Legislation to Allow Gestational Surrogacy Contract Enforcement for Social Surrogacies, 75 SMU L. REV. 973, 988 (2022).


[12] Pavan v. Smith, 582 U. S. 1 (2017)


[13] Hodges, 576 U.S. 644 (2015)


[14] In Re: The Adoption of Male Child A.F.C. By: C.M.C. and D.F.C., and J.L.B. (Tennessee Court of Appeals 2013), https://www.tncourts.gov/sites/default/files/inre.a.f.c.opn_.pdf


[15] Richard B. Vaughn, UPA (2017): An Improvement––Except Where Genetic Surrogacy Is Concerned., 52 Fam. Law Q. 471, 477 (2018).


[16] Johnson v. Calvert, 5 Cal. 84 (1993)


[17] Matthew Renda, Surrogate Mother’s Attempt to Regain Her Children Fails in Ninth Circuit, Courthouse News, (Jan. 12, 2018), https://www.courthousenews.com/surrogate-mothers-attempt-to-regain-her-children-fails-in-ninth-circuit/#:~:text=Cook%2C%20a%2049%2Dyear%2D,afford%20to%20pay%20for%20it


[18] Dobbs v. Jackson Women's Health Organization, 597 U.S. (2022)


[19] U.S. Const. Art. 1 § 8 cl. 3.



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