One of the most controversial provisions of the Affordable Care Act (ACA), the contraceptive coverage rules require most businesses with 50 or more employees to offer FDA-approved methods of birth control in their employer-sponsored health plans. But the mandate is being challenged in legal cases that have made it all the way to the Supreme Court.
This Daily Briefing primer breaks down what you need to know about the mandate—and its legal fate.
How the mandate works—and who is exempt
The ACA requires employers with more than 50 workers to offer health insurance covering preventive health services, including women's preventive services, without consumer cost sharing. In 2011, HHS said it would adopt an Institute of Medicine (IOM) recommendation that the preventive coverage requirement include contraception.
However, not-for-profit employers do not have to offer the coverage if they are considered a "religious employer," meaning they:
- Have the inculcation of religious values as their purpose;
- Primarily employ individuals who hold certain religious beliefs; and
- Primarily serve a population with those religious tenets.
The final rules also provide accommodations for non-exempt, not-for-profit religious organizations, such as religiously affiliated hospitals, universities, and charities. An eligible organization is one that:
- On account of religious objections, opposes providing coverage for some or all of any contraceptive services otherwise required to be covered;
- Is organized and operates as a not-for-profit entity;
- Holds itself out as a religious organization; and
- Self-certifies that it meets these criteria in accordance with the provisions of the final regulations.
Under the accommodation, an eligible not-for-profit does not have to contract, arrange, pay, or refer for contraceptive coverage. Religiously affiliated hospitals, universities, and other not-for-profits that oppose contraceptive coverage must notify their insurer of the objection. However, the health plans must provide no-cost contraceptive coverage directly to beneficiaries.
In the case of self-insured employers, the company would notify a third-party administrator who would be responsible for informing enrollees that it will provide them with contraceptive coverage at no additional out-of-pocket cost. Meanwhile, no accommodation was offered to for-profit businesses.
Covered companies that fail to comply with the mandate may face substantial fines.
Lawsuits mount against birth control rule
To date, nearly 100 lawsuits have been filed against the controversial mandate by both for-profit and not-for-profit employers.
>> Challenges brought by for-profit employers
This term, the Supreme Court will hear arguments in two corporate challenges to the contraceptive rule: One filed by retail chain Hobby Lobby, and another from cabinet maker Conestoga Wood Specialties.
Supreme Court will hear another challenge to the ACA
Hobby Lobby, Conestoga, and many other companies challenging the policy argue that it goes against their owners' personal religious beliefs and violates the 1993 Religious Freedom Restoration Act, which "protects a person's exercise of religion."
In hearing the cases, the Justices will weigh whether for-profit corporations can exercise religious rights, as well as whether the First Amendment's free exercise clause may apply to for-profit businesses. A decision could be handed down anytime between the oral arguments in March and the end of the Court's term in June.
>> Challenges brought by not-for-profit employers
A federal judge in December 2013 granted the first permanent injunction against the federal contraceptive coverage mandate to affiliates of the Catholic Archdiocese of New York, ruling that requiring the not-for-profits to authorize a third party to provide contraceptive coverage violated the religious beliefs of the organizations, even if the organizations are not required to financially support the coverage.
One month later, the Supreme Court granted a temporary injunction in a class action suit filed on behalf of the Little Sisters of the Poor Home for the Aged and other Catholic not-for-profits that use the same insurance provider. Although the plaintiffs are eligible for the accommodation for not-for-profit religious employers, they argued that they still "would be required to actively facilitate and promote the distribution of these [contraception] services in ways that are forbidden by their religion."
The Department of Justice asked the high court to lift the temporary injunction, arguing that the groups would not have to provide coverage regardless of the stay. However, the high court opted to extend the injunction, essentially delaying the court from considering the law's legal merits.
Sources: ACLU, 1/30; CMS fact sheet, accessed 2/3; Federal Register, 7/2/13; Miller, Kaiser Health News, 9/18/13; National Women's Law Center, accessed 2/3; Becket Fund for Religious Liberty, accessed 2/3; Boumil/Curfman, Health Affairs Blog , 12/27/13
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