Tuesday, December 17, 2013

EBSA Form 700 and the Contraceptive Mandate

Many religious institutes are reporting that they have received a notice from their insurance companies or their third party administrators asking them to indicate a choice or sign a form immediately with regard to their health care coverage. The form most often being asked about is the EBSA Form 700. Note that not every organization that claims to be religious needs to sign that form.

This request from insurers is coming now because insurance providers need to know whether they are on the hook under the Affordable Care Act (ACA) for providing contraceptives, sterilization, and abortion-inducing drugs for employees of your organization. As you hopefully know, the ACA requires all insurance coverage to provide "essential health benefits," which includes "women's preventive care." This is where the objectionable coverage for contraceptives, sterilization, and abortion-inducing drugs comes into play, which is the subject of dozens of lawsuits across the United States. We at RCRI have held two webinars on the subject this year to inform our members of what is happening with the "contraceptive mandate," as it has come to be known.

Back to the form that you may be asked to sign by your insurance company. There are two main ways that you may be exempt from having to provide these women's preventive services. First is if your plan is grandfathered. You should know if this applies to your employee plan already, and your insurance company should know, so I won't go into any detail on grandfathered plans here.

The second way to be exempt is if you qualify as a either a "religious employer" or as an "eligible organization." (Some would say this is two ways because they have different results.) The final regulations on the contraceptive mandate define a "religious employer" as "an employer that is organized and operates as a nonprofit entity and is referred to in section 6033(a)(3)(A)(i) or (iii) of the Code." Section 6033(a)(3)(A)(i) and (iii) of the Code refers to churches, their integrated auxiliaries, and conventions or associations of churches, as well as to the exclusively religious activities of any religious order. The italicized  phrases are the ones that are most likely to apply to religious orders and some of their sponsored ministries.

The religious institute itself most likely will qualify as a "religious employer." However, any of its ministries beyond those activities that are "exclusively religious" must be examined to see if they qualify as "integrated auxiliaries" of a church (in this case, the Catholic Church). A full explanation of what an integrated auxiliary is is beyond the scope of this blog post, but religious institutes should familiarize themselves with the criteria. (It is a similar analysis to the one conducted to determine whether a ministry is required to file a Form 990, and often hinges on whether the organization is "internally supported.") [Note: Donna Miller can provide more on this topic and how to conduct an analysis if you request it from her at dmiller@trcri.org.]

If your organization does not qualify as a "religious employer" and is not exempt outright from having to provide the contraceptive coverage, you may be an "eligible organization"-- that is, qualified for an "accommodation." This means that you do not have to pay premiums for the employees to be covered for contraception, sterilization and abortion-inducing drugs, but your insurance provider or third-party administrator DOES have to cover these items for your employees.

Although intended to be a solution to the outcry that the original definition religious employer was too narrow, this provision remains controversial for many employers who have religious objections. You can read a letter entitled "Unacceptable" dated February 10, 2012, signed by dozens of Catholic university personnel and multi-denominational theologians at this link. This letter summarizes the continuing objection that these individuals and organizations have over the amended contraceptive mandate final rules. A statement of similar content was also made by the USCCB this past summer, and that statement can be found here. On the other hand, despite its initial objection to the narrow definition of "religious employer" contained in the proposed rules, Catholic Health Association announced that it could "live with" the accommodation provision in the amended rules and would not challenge the mandate any further. Its statement can be found at the end of this NCR article.

So what is an "eligible organization"?
[A]n eligible organization is an organization that: (1) opposes providing coverage for some or all of the contraceptive services required to be covered [...] on account of religious objections; (2) is organized and operates as a nonprofit entity; (3) holds itself out as a religious organization; and (4) self-certifies that it satisfies the first three criteria (as discussed in more detail later in this section). (https://www.federalregister.gov/articles/2013/07/02/2013-15866/coverage-of-certain-preventive-services-under-the-affordable-care-act#h-13)
So, in order to be an eligible organization, your organization must oppose the coverage requirements due to religious objections, be a nonprofit, hold yourself out as a religious organization, and sign certification to that effect. Notice that this is the only one of the two provisions (religious employer and eligible organization) that requires a certification to be signed. However, it is quite understandable that insurers and third-party administrators would request that religious employers also sign a form indicating their status so that they can justify not providing coverage for the objectionable women's services.

In Summary, the EBSA Form 700 is to be signed by organizations that qualify as an "eligible organization" (eligible for an accommodation). Religious employers should not sign the same form because it indicates that an accommodation should be made for the employees, and no such accommodation is required under the contraceptive mandate. An adapted Form 700 can be drafted using language that expresses that a complete exemption from the contraceptive mandate, rather than an accommodation, is being claimed.

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