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Supreme Court Vacates Appellate Court’s Contraceptive Coverage Ruling In Light of Hobby Lobby

From the March 26, 2015 EBIA Weekly

[Univ. of Notre Dame v. Burwell, 2015 WL 998533 (U.S. 2015)]

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The U.S. Supreme Court has vacated the Seventh Circuit’s denial of a preliminary injunction requested by a nonprofit religious university challenging health care reform’s contraceptive coverage mandate, and remanded the case for further consideration. In February 2014, the Seventh Circuit affirmed a trial court’s denial of the university’s request to enjoin enforcement of the mandate as a violation of the Religious Freedom Restoration Act and the Constitution’s Free Exercise, Establishment, and Free Speech Clauses. (See our article on the trial court decision.) The mandate generally requires non-grandfathered, nonexcepted group health plans to provide coverage for certain contraceptives without cost-sharing when services are provided in-network. But qualifying religious employers are exempt, and an accommodation process is available for certain nonexempt, nonprofit organizations with religious objections (see our article). (When an accommodation is requested, the plan’s insurer or TPA (as applicable) provides separate coverage for contraceptive services at no additional cost.) The university had challenged the accommodation process which, at that time, required employers with religious objections to provide a notice to their insurers or TPAs.

In June 2014, the U.S. Supreme Court held in Hobby Lobby that health plans of closely held for-profit corporations cannot be required to cover contraceptives if doing so would contradict the owners’ religious beliefs (see our article). Shortly thereafter, the agencies revised their regulations regarding the accommodation process to allow nonexempt, nonprofit organizations not wishing to notify their insurers or TPAs of a religious objection to instead notify the government, which will then contact the insurer or TPA (see our article). The Court has now vacated the Seventh Circuit’s decision and has sent the case back for further consideration in light of Hobby Lobby.

EBIA Comment: Other challenges to the accommodation process are working their way through the courts, and may eventually make their way to the U.S. Supreme Court. This case could also end up at the Supreme Court again, but the next step will be to see how the Hobby Lobby decision and revised accommodation process affect the outcome in the lower courts. For more information, see EBIA’s Health Care Reform manual at Section XII.C (“Coverage of Preventive Health Services”); see also EBIA’s Group Health Plan Mandates manual at Section XIII.C (“Coverage of Preventive Health Services”).

Contributing Editors: EBIA Staff.

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