SCOTUS Issues Eleventh Hour Stay Against Enforcement of Contraceptive Mandate

Supreme Court Justice Sonia Sotomayor signed an order last night that temporarily prevents the U.S. government from enforcing the contraceptive mandate against the Catholic organizations that filed a lawsuit earlier this year.



This is the same case in which the Christian Brothers Employee Benefit Trust is a plaintiff. The Order gives the Obama Administration until 10:00 Friday morning (Jan. 3) to file a response with the Court. At that time the Court will likely issue either a retraining order that could remain in place until the case makes its way through the courts, or it could lift the injunction and allow penalties to start accruing against the plaintiffs if they do not comply with the mandate while the case moves through the courts.

The Becket Fund for Religious Liberty, which represents the Little Sisters of the Poor in the law suit, has an announcement on its website reporting on the last minute stay by the Supreme Court.

Stay tuned.

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.

Confusion Surrounds Implementation of ACA

If you are finding yourself confused over what lies ahead as we quickly approach deadlines in the implementation of the Affordable Care Act, you are not alone. The employer mandate has been delayed for a year, but not the individual mandate. People all over the country are expressing mixed emotion and mixed levels of understanding about what to expect.

Recently at our National Conference in Anaheim we had two experts speak at our pre-Conference workshop on the ACA. Many religious institutes remain concerned over the requirement that essentially all health insurance policies (for men and for women alike) cover women's preventive services that include contraceptives, sterilization, and abortion-inducing drugs. We have a webinar scheduled for mid-November that will address in part the latest on the status of the contraceptive mandate and the ongoing litigation in courts across the United States. Watch for emails and check our website in the next few weeks when we open the webinar for registrations.

Archdiocese of NY Lawsuit Over the HHS Mandate Is Allowed to Proceed

For over a year now, religious organizations of many denominations have been struggling with a particular provision that was included in the Patient Protection and Affordable Care Act (sometimes called PPACA, ACA, or Obamacare), which Act was signed into law in March of 2010. The provision in question requires all group insurance plans to cover certain preventative medical services without cost-sharing (a deductible or co-payment) on the part of the insured. In 2011, the government agency tasked with implementing the ACA--the Department of Health and Human Services (HHS)-- issued the regulations that mandated which preventive services must be included in all group health plans. For women, these services include contraception, any drug that has been approved by the Food and Drug Administration (which includes abortafacient drugs that destroy or prevent implantation of a fertilized egg), sterilization, and all related counseling services.

Because of the Catholic teaching on the sanctity of life and the mandate to protect life from conception to natural death, these particular services are contrary to the free practice of religious beliefs. Numerous lawsuits have been filed asserting that the mandate will cause employers who hold these religious beliefs to violate their consciences. The HHS proposed a exemption for certain religious employers, but the criteria make it a very narrow field for those who will be exempt. And even if the organization does meet the criteria, it only grants a one-year delay in having to come into full compliance with the mandate.

In order to qualify for the religious employer exemption, an organization must meet all of the following criteria: 

(1) The inculcation of religious values is the purpose of the organization. 

(2) The organization primarily employs persons who share the religious tents of the organization.  

(3) The organization serves primarily persons who share the religious tenets of the organization.  

(4) The organization is a nonprofit organization [...].

These criteria cannot be met by many Catholic organizations outside of dioceses and parishes. Catholic schools and hospitals often do not hire or serve primarily Catholics in many instances. Religious institutes that have employees, the majority of whom  are not Catholics, also do not qualify. Indeed, it has been pointed out that Jesus himself probably would not be able to qualify his ministry under these criteria. For some religious organizations, the only solution will be to stop offering group health insurance coverage. If they have 50 or more employees, they will then have to pay a sizable fine for each employee. But that is beyond the scope of what this blog post is addressing.

With regard to the challenge to the HHS Coverage Mandate, numerous lawsuits have been filed across the country by religious organizations, primarily Catholic, but a few from other denominations as well. Some private employers whose businesses are not religious in nature have also filed lawsuits stating that their individual right to religious freedom is being infringed by the HHS mandate as well. As these lawsuits have worked their way through the various federal courts, decisions have been  reported quite regularly. Some cases have been dismissed on various grounds, while some have survived to move on to the next phase in the legal proceedings.

Just yesterday, the U.S. District Court for the Eastern District of New York (a federal court) issued a decision in a case filed by the Archdiocese of New York. It is a minor victory for now in that it merely allows the Archdiocese to proceed with its case rather than dismissing it as requested by Kathleen Sebelius (Secretary of HHS). Sebelius had argued that the Archdiocese's case should be dismissed for two reasons: (1) because the Archdiocese lacked standing to assert their claims because the Coverage Mandate is not causing an imminent injury; and (2) the Archdiocese's case is not ripe because the government is possibly going to change the Coverage Mandate.

In his written opinion, the judge in the case goes through a thorough summary of many of the similar lawsuits that have already made their way to this stage of proceedings. In the end Judge Brian M Cogan sides with the judges who have NOT dismissed the lawsuits. There are  several quotable excerpts from Judge Cogan's opinion.

Quite frankly, ignoring the speeding train that is coming towards plaintiffs in the hope that it will stop might well be inconsistent with the fiduciary duties that plaintiffs' directors or officers owe to their members. As explained above, the practical realities of administering health care coverage for large numbers of employees- which defendants' recognize- require plaintiffs to incur these costs in advance of the impending effectiveness of the Coverage Mandate. That is a business reality that any responsible board of directors would have to appreciate. 

Moreover, the First Amendment does not require citizens to accept assurances from the government that, if the government later determines it has made a misstep, it will take ameliorative action. There is no, "Trust us, changes are coming" clause in the Constitution. To the contrary, the Bill of Rights itself, and the First Amendment in particular, reflect a degree of skepticism towards governmental self-restraint and self-correction. 

Because of the contradictory rulings issuing from the federal courts throughout the United States in these cases, the Supreme Court inevitably will have to weigh in and rule on the Constitutionality of the Coverage Mandate. It could come some time next year - at least the Court accepting the case for review could happen that soon. Since the deadline for expiration of the one-year extension is August 1, 2013, many speculate that the Court will take up the case(s) on appeal in the Spring of next year.

We are waiting to see what happens. The outcome will affect the decision-making--and possibly the financial affairs--of many religious organizations and their employees.