Supreme Court Hears New ACA Contraceptive Coverage Challenge
Author: David B. Weisenfeld, XpertHR Legal Editor
March 25, 2016
The Supreme Court heard arguments this week in a closely-watched case involving the Affordable Care Act's (ACA's) contraceptive coverage requirement. But during the 90 minute argument in Zubik v. Burwell, the now eight-person Court appeared equally divided.
The ACA requires employer-sponsored group health plans and health insurers to provide certain preventive services to employees at no cost. The Department of Health and Human Services has included contraception as part of that requirement. However, it allows religious nonprofits to opt out of directly providing contraceptive coverage by sending a form to the plan's health insurer or third-party administrator.
A number of religious nonprofits have made use of the government's accommodation. For instance, in 2015, more than 10 percent of all nonprofit organizations with 1,000 or more employees took advantage of it.
But two dozen religiously affiliated nonprofits are challenging this mandate, claiming it places a substantial burden on their sincerely held religious beliefs by allowing health insurers to provide these services to their employees or students.
The challengers' attorney Paul Clement said the opt-out form process "hijacked the employers' health plans." That argument appeared to resonate with Justice Anthony Kennedy, who said, "The religious organization plans here are, in effect, subsidizing the conduct that they deemed immoral."
Solicitor General Donald Verrilli, Jr., arguing for the Obama administration, asserted that many of these employees may not share their employers' religious beliefs about contraception. He told the Court that the rights of those employees should not be extinguished.
But Clement countered by saying, "My clients equally enjoy the Title VII exemption which gives them the right to hire co-religionists."
This dispute is a follow up to the Court's 2014 Hobby Lobby ruling, in which the justices held 5-4 that the ACA requirement for certain employers' group health plans to provide preventive care for women, including contraceptive coverage, violated the Religious Freedom Restoration Act of 1993.
But the government notes that the present case differs by exempting these religious nonprofits from having to provide coverage, and instead allowing employees to have separate third-party arrangements with an Aetna or Blue Cross Blue Shield for the benefits.
The death of Justice Antonin Scalia last month adds uncertainty to the result. Although the government prevailed in seven of the eight appellate courts that considered this issue, losing only in the Eighth Circuit Court of Appeals, if the Supreme Court divides 4-4, it could simply leave the lower court rulings intact without setting any nationwide precedent. That would mean religious-based organizations in different parts of the country would have differing obligations.