The Contraceptive Coverage Mandate and the So-Called “War on Religion” – Part I

February 8, 2013

Insurance LawThe United Supreme Court’s decision last summer in National Federation of Independent Business v. Sebelius, did not end litigation challenging the Affordable Care Act (ACA). As the litigation before the Supreme Court drew to a close, a new wave of lawsuits emerged challenging the Obama Administration’s regulations requiring health plans to cover contraceptives without cost sharing or deductibles under the ACA’s preventive care mandate.

The dispute stems from a provision in the ACA requiring most health plans to cover preventive care without cost-sharing in the form of co-payments or deductibles. The ACA defines preventive services to include services for women as set forth in guidelines issued by the Health Resources and Services Administration (HRSA). Those guidelines require coverage for the full range of Food and Drug Administration approved contraceptives, including intrauterine devices and “emergency contraceptives” that cause the demise of a fertilized embryo.

Both religious and secular businesses objected to the contraceptive mandate on religious grounds. Some asserted that any form of birth control violates their religion’s moral teachings. Others objected only to the requirement of coverage for emergency contraceptives that prevent a fertilized embryo from developing.

Religious Employers

The Obama Administration has struggled with how to accommodate these religious beliefs without undermining the public health objectives of the ACA. The Administration’s regulation implementing the ACA’s preventive care provision expressly exempts “religious employers” — defined to include not just churches, but certain church institutions that have a strong religious orientation, like primary schools, are exempt from the contraception coverage requirement—from the contraception coverage mandate.

Some commentators criticized the original definition of  “religious employer” as too narrow—because it might not apply to house of worship-run soup kitchens serving non-members—and too intrusive—because it required examining the religious beliefs of employees. Those concerns were addressed in proposed changes released last week.  Under the revised rule, religious employers need not establish that the inculcation of religious values is their primary purpose, nor that they primarily employ and serve persons who share their religious tenets.

Religious Non-profits

The revised rules also attempt to accommodate the concerns of non-profit religious hospitals, universities, or charities that do not qualify for the religious employer exemption. Under the proposed compromise, faith-based non-profits will be excused from including contraceptive coverage in their policies. Insurers will then be required to enroll plan participants and beneficiaries in a separate health insurance policy covering only contraceptives, at no cost to the employer or the participants and beneficiaries. The insurer will itself bear the cost of coverage, which should be offset by the lower costs it will experience under the policy issued to the employer due to the reduction in unwanted pregnancies resulting from the availability of contraceptive care.

Significantly, the Administration refused to create an exemption for private, for-profit, secular employers whose religious principles prohibit use of birth control. These employers were required to start including contraceptive coverage in health plan years beginning on or after August 1, 2012. Our next post will examine the challenges raised by these secular employers.