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The University of Notre Dame will have another chance to try and persuade the 7th U.S. Circuit Court of Appeals that U.S. Department of Health and Human Services (HHS) regulations on contraception coverage are too burdensome for the Catholic-affiliated institution.
On March 9, 2015, the U.S. Supreme Court vacated the 7th U.S. Circuit Court of Appeals’ ruling that Notre Dame had to abide by the regulations, an appeals court decision that preceded the Supreme Court’s ruling in Burwell v. Hobby Lobby Stores Inc., No. 13-354. The Supreme Court instructed the lower court to further consider Notre Dame’s arguments in light of Hobby Lobby.
The takeaway for employers in the Notre Dame case, according to Peter Marathas, an attorney with Proskauer in Boston, is that the HHS is not locked into the list of preventive care benefits that it has issued.
The Affordable Care Act (ACA) provides that nongrandfathered group health coverage must provide preventive care services to all participants with no cost-sharing, Marathas told SHRM Online.
When the HHS originally provided a list of preventive care services, it included things employers would expect, such as colonoscopies and mammograms, Marathas said. But the ACA gives the HHS the right to review and change the list.
Looking at the original list, many employers decided it would be easy to give up grandfathered status because they already were providing preventive care as originally defined by the department, he noted.
“Fast forward to 2012 when HHS says, ‘By the way, the list of preventive services includes 20 forms of birth control, including four abortifacients,’ ” Marathas said.
The change looked like it would impact three groups of employers—first, churches, synagogues and other religious employers, he said. The second group consisted of those employers like Notre Dame that are affiliated with religious groups. And finally, faith-based private employers, such as Hobby Lobby, made up the third group.
But HHS said the first group didn’t have to provide these preventive services, according to Marathas. For the second group, HHS said if such an employer doesn’t want to offer the benefits, the employer tells the insurer, and then the insurer will have to provide them. HHS did not recognize the third group, faith-based private employers, as having any special rights, Marathas remarked.
In Hobby Lobby, the Supreme Court said that for purposes of the Religious Freedom Restoration Act (RFRA), faith-based businesses can be treated as a person. Ultimately, in Hobby Lobby, the HHS could not enforce the contraceptive coverage requirements in the ACA regulations against corporations whose owners believed that making the abortifacients available to employees would violate their religious beliefs. As applied to faith-based, closely held companies, the HHS regulations violated the RFRA.
The Supreme Court assumed there was a compelling government interest—guaranteeing cost-free access to all contraceptives—but decided that the regulation was not the least restrictive means of furthering that interest.
Least Restrictive Option?
The Supreme Court did not say in Hobby Lobby that it was the least restrictive option for religious-affiliated organizations to notify insurers that they weren’t following the contraception mandate, Marathas emphasized.
The HHS in the meantime has said that organizations affiliated with religious groups do not have to go to insurers but instead can simply notify the government (not even on a form, but simply by a letter), and the government will arrange for the coverage, Marathas noted.
The 7th Circuit will take a look at whether the government’s accommodation is the least restrictive alternative. Notre Dame will likely argue that it is too burdensome because it includes the university in the process and the school does not want to be involved in a process that results in an abortifacient being provided and used, Marathas predicted.
By sending Notre Dame’s case back to the 7th Circuit, the appeals court is in essence telling the lower courts to “flesh this out. Maybe we will look at it one day,” he said.
This case is Notre Dame v. Burwell, No. 14-392.
Allen Smith, J.D., is the manager of workplace law content for SHRM. Follow him @SHRMlegaleditor.
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