The 2010 Affordable Care Act (ACA), the United States’ controversial health care coverage act, requires group health plans and insurers to cover preventive care and screenings for women. Under the related regulations, this coverage includes government-approved contraceptive methods, but the group health plan of a religious employer may be exempt from providing such coverage or granted an accommodation to avoid paying for such coverage. A for-profit employer with religious objections tested this contraceptive mandate in Burwell v. Hobby Lobby, and in 2014, the U.S. Supreme Court held that the mandate substantially burdened the exercise of the employer’s religion and that there is a less restrictive means of furthering ACA’s interest. Hobby Lobby was the first time the highest court recognized a for-profit corporation’s claim of religious belief, but the holding is limited to closely-held corporations. In Hobby Lobby, when discussing whether there was a less restrictive means, the Supreme Court noted that ACA’s regulations already allow an “accommodation” to a nonprofit organization to avoid paying for any required contraception by certifying its religious objection to the insurer, which must then separately pay for any required contraceptive services. However, the Court did not decide if such an “accommodation” is the least restrictive means for providing coverage in all circumstances where a religious claim may be made.
That “accommodation” is now directly under attack in Zubik v. Burwell, a case the Supreme Court is poised to hear in 2016. On November 6, 2015, the high court agreed to review the limited question of whether ACA’s contraceptive coverage and the religious-objection accommodation violate the Religious Freedom Restoration Act (RFRA) by forcing religious nonprofits to provide contraceptive coverage in disregard of their religious beliefs, where the government has failed to prove this is the least restrictive means of advancing a compelling government interest. Under RFRA, the government may substantially burden an entity’s exercise of religion only if it demonstrates the burden (1) is the least restrictive means of (2) furthering the government’s compelling interest. The Zubik nonprofits – Catholic nonprofit colleges and related entities – essentially want an “exemption” so that their employees do not have contraceptive coverage, rather than an “accommodation” permitting the coverage but excusing the employers from paying for it. They claim that ACA’s contraceptive-coverage requirement, even with the accommodation, still forces them to facilitate access to contraceptive services and that ACA essentially gives them two religiously-objectionable choices: (1) providing insurance coverage to employees, thereby providing the objectionable contraceptive coverage; or (2) refusing to provide insurance coverage, thereby facing large fines, hurting the employees’ well-being, and being competitively disadvantaged in the employment market.
The religious entities prevailed at the district-court level, but the Third Circuit sided with the government. The Third Circuit reasoned that: (1) the Zubik religious entities were able to use the regulatory accommodation to avoid both paying for contraceptive coverage and facing penalties for noncompliance; and (2) federal law (i.e., ACA) obligates insurers and third-party administrators to provide contraceptive coverage, and a religious entity is not complicit in that provision of coverage simply because it files the religious-objection accommodation form.
When the Supreme Court rules in Zubik, it should resolve a split in the circuit courts and shed light on the proper test to use for determining whether ACA’s contraceptive-coverage requirement imposes a substantial burden under RFRA. The Third Circuit used an objective test, finding that submission of the self-certification form does not make a religious entity complicit in religiously-objectionable conduct. Other circuits have used a test that gives deference to the religious entity’s understanding of what makes a particular action religiously objectionable. The Court’s holding could have a broad impact not only on RFRA jurisprudence, but also on the provision of benefits to employees under ACA. Although the Supreme Court has previously held that one’s religious objections cannot be used to block third parties from acting, the Zubik religious entities have directly challenged this holding. Should they succeed, they would effectively obtain an exemption from the contraceptive-coverage mandate just like the exemption given to a group health plan of a religious employer. Were that to happen, one can expect closely-held for-profit corporations to follow suit, challenging a similar religious-objection accommodation that went into effect this year for them.
This fight is one to watch as ACA again comes under fire and butts heads with religious rights.