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Supreme Court Decides Not to Decide on Coverage for Contraception

May 17 2016

Supreme Court Decides Not to Decide on Coverage for Contraception

On May 16, 2016, the US Supreme Court decided unanimously not to issue an opinion in the case of Zubik v. Burwell No. 14-1418.  Rather, the eight member Court said there is no need for the Court’s decision because the Catholic entities who filed the suits and the Obama Administration had agreed that female employees may "receive cost-free contraceptive coverage" without infringing on the religious rights of the church-based employers. The issue before the Court was whether the contraceptive coverage mandate and the accommodation by the Administration violate the Religious Freedom Restoration Act by forcing religious nonprofits to act in violation of their sincerely held religious beliefs. The Accountable Care Act (ACA) requires coverage of contraceptives for women. Some religious groups did not want to offer insurance coverage for contraception. The accommodation allows the groups not to pay for coverage and to avoid fines if they request an exemption. Insurance companies or the government would then pay for the coverage. Some religious groups objected to the accommodation saying that signing and providing the required notice still required them to participate in a process with an outcome that violates their religious beliefs.

The “compromise” between the religious groups and the Administration that is different than the accommodation currently in place is that the religious groups would not be required to submit a separate notice that the group will not cover contraceptives for women. The religious groups would simply inform their insurer that they are selecting, for religious reasons, a health plan that does not include contraceptive coverage. The insurance company, knowing that the selected coverage does not cover contraceptives for women, would notify the religious groups’ employees that the insurance company will provide contraceptive coverage at no cost to employees. This slight change puts the burden of compliance on the insurance companies, not the religious groups. The change also does not require the religious groups to proactively exempt themselves from compliance with the ACA to avoid fines.

The matter is settled for now provided the compromise is implemented to the satisfaction of the parties with nine of the circuit courts overseeing the negotiation process. Prior to the Supreme Court’s unsigned non-opinion, eight circuit courts sided with the Administration and one Circuit (the 8th) with the religious groups. A 4-4 Supreme Court decision would have left the accommodation provided by the administration in place nationwide except in Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota and South Dakota.  

The compromise position that follows from this case shifts the burden of compliance with the contraceptives mandate to insurers and third party administrators (TPAs). Insurers and TPAs will be responsible for offering plans without contraceptive coverage, obtaining confirmation (without requiring written documentation) that the religious employer’s selection of the plan was for religious reasons and notifying employees that they may still obtain contraceptive coverage at no cost.