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30 Jun, 2014 16:18

Supreme Court allows some employers to drop contraception coverage from healthcare plans

Supreme Court allows some employers to drop contraception coverage from healthcare plans

The Supreme Court ruled on Monday that the government cannot require “closely held” corporations to provide contraception coverage to its employees under the Affordable Care Act.

In a divided 5-4 ruling that carves out a piece of President Obama’s healthcare law, the court reasoned that under the 1993 Religious Freedom Restoration Act (RFRA), for-profit companies that are primarily controlled by a single family or a few individuals do not have to provide birth control coverage.

According to the Internal Revenue Service, a closely held corporation is one “that has more than 50% of the value of its outstanding stock owned (directly or indirectly) by 5 or fewer individuals at any time during the last half of the tax year; and is not a personal service corporation.”

Written by Justice Samuel Alito, the majority opinion found that with the contraception mandate, the government was unable to prove the mandate was “the least restrictive means of furthering” its interest in providing women cost-free access and availability to birth control, something that is required under the RFRA.

As noted by SCOTUSblog, the high court decided this case simply on statutory grounds, and did not reach for the First Amendment claims invoked by Hobby Lobby.

Hobby Lobby was one of the 49 for-profit corporations that sued the Obama administration over its decision to mandate employers cover birth control under the preventative care services outlined by the ACA. Under the ruling, women working for companies that deny contraception coverage will have to find it elsewhere.

"Any suggestion that for-profit corporations are incapable of exercising religion because their purpose is simply to make money flies in the face of modern corporate law," Alito wrote, according to the Huffington Post, adding that in making companies cover contraception, "the [Health and Human Services] mandate demands that they engage in conduct that seriously violates their religious beliefs."

“There are other ways in which Congress or HHS could equally ensure that every woman has cost-free access to the particular contraceptives at issue here and, indeed, to all FDA-approved contraceptives,” he added.

Although the Supreme Court ruled against the administration in this instance, it also said the government itself could pay for contraception coverage in order to ensure women have access to it. This pushed SCOTUSblog to suggest, “it is extremely likely that the Obama administration will by regulation provide for the government to pay for the coverage. So it is unlikely that there will be a substantial gap in coverage.”

The court emphasized that its decision was written narrowly to apply only to the contraception mandate and only to closely held corporations. Therefore, it does not mean that companies who object to services like blood transfusions and vaccinations on religious grounds will be able to avoid providing such coverage to its employees.

A protester dressed as a copy of the Bible joins groups demonstrating outside the U.S. Supreme Court in Washington June 30, 2014 (Reuters / Jonathan Ernst)

Additionally, the court ruled that its decision would not leave room for companies to justify discriminatory practices under the guise of religious belief.

In a dissent written by Justice Ruth Bader Ginsburg and joined by Justice Sonia Sotomayor – Justices Elena Kagan and Stephen Breyer joined in part but also filed their own dissent – Ginsburg called the majority opinion “a decision of startling breadth.” She stated the ruling means, “commercial enterprises, including corporations, along with partnerships and sole proprietorships, can opt out of any law (saving only tax laws) they judge incompatible with their sincerely held religious beliefs.”

According to the Wall Street Journal, Ginsburg argued that the RFRA was never meant to apply to for-profit corporations, and reasoned that the decision paved the way for future cases in which companies deny other types of coverage. She also criticized the majority’s suggestion of allowing the government to pay for birth control, asking, "Where is the stopping point to the 'let the government pay' solution?"

Justice Anthony Kennedy, meanwhile, also offered his thoughts on Ginsburg’s criticism in a concurring opinion to Alito’s. As reported by the Huffington Post, he noted the Obama administration had already offered some institutions – churches, religiously affiliated hospitals and non-profits – an exemption from the birth control mandate. Since that was the case, he argued that exempting another class of organizations would be feasible, and that the ruling “does not have the breadth and sweep ascribed to it by the respectful and powerful dissent."