Court Says Religious Non-Profits Need Not Identify Their Insurers To HHS

In Christian and Missionary Alliance Foundation, Inc. v. Burwell, (MD FL, Feb. 3, 2015), a Florida federal district court granted a preliminary injunction barring enforcement of part of the latest rules accommodating religious non-profits' objections to the Affordable Care Act contraceptive coverage mandate:

The Court finds that the portion of the accommodation process which requires plaintiffs to self-certify their eligibility for the accommodation and provide that written self-certification to the HHS does not substantially burden plaintiffs’ exercise of religion.... This notification need not be on a government-issued form.

... [However] the Court reaches the opposite conclusion as to the portion of the government form which requires identification of and the contact information for plaintiffs’ insurance carrier and/or third party administrator.... Compelling plaintiffs to identify their providers or administrators to the HHS clearly facilitates the government’s ability to implement contraceptive coverage for plaintiffs’ female employees. While plaintiffs cannot preclude the government from such implementation, the identification requirement compels plaintiffs to become excessively entangled in the process of providing coverage for services which their sincerely held religious beliefs prohibit....

AP reports on the decision.

More Companies Win On Basis of Hobby Lobby Decision

In a brief opinion in Briscoe v. Burwell, (D CO, Jan. 27, 2015), a Colorado federal district court, applying the Supreme Court's Hobby Lobby decision, enjoined enforcement of:

those provisions of federal law in existence on June 30, 2014, when the Supreme Court decided Hobby Lobby, that require plaintiffs Continuum Health Partnerships, Inc.; Continuum Health Management, LLC; and Mountain States Health Properties, LLC to provide their employees with health coverage for “[a]ll Food and Drug Administration approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity,” ...to which plaintiffs object on religious grounds.

AP reports on the decision.

Injunction Issued In Contraceptive Mandate Case On Remand From Supreme Court

On remand from the U.S. Supreme Court after its Hobby Lobby decision (see prior posting), in Autocam Corp. v. Burwell, (WD MI, Jan. 5, 2014), a Michigan federal district court issued a permanent injunction barring enforcement of the Affordable Care Act contraceptive coverage mandate against Autocam Medical, LLC. Members of a Catholic family were the CEO and controlling owners of Autocam. The injunction covered:

those provisions of federal law in existence on June 30, 2014, when the Supreme Court decided Hobby Lobby, that require plaintiff Autocam Medical, LLC, to  provide its employees with health coverage for contraceptive methods, sterilization procedures, and related patient education and counseling to which  plaintiff objects on religious grounds.

Thomas More Society issued a press release announcing the decision.

District Court Enjoins Latest ACA Non-Profit Contraceptive Coverage Mandate Accommodation

In Catholic Benefits Association LCA v. Burwell, (WD OK, Dec. 29, 2014), an Oklahoma federal district court granted a preliminary injunction against the latest Affordable Care Act contraceptive mandate accommodation to a Catholic nonprofit association that was formed to assist Catholic employers in providing health benefits.The court said:

Although CBA members may be “effectively exempt” from directly providing contraceptive services if they comply with the notification requirement, they are not exempt from the notification requirement itself. This requirement also violates their religious beliefs because, they argue, it requires them to be complicit in indirectly providing their employees with contraceptive services.

After thus finding a substantial burden on plaintiffs' religious exercise, the court concluded that prior 10th Circuit precedent (its decision in  Hobby Lobby) has held that the government does not  have a compelling interest in requiring contraceptive coverage, and the Supreme Court in Hobby Lobby did not conclusively rule otherwise.

Cert. Petiiton Filed In 6th Circuit ACA Non-Profit Contraceptive Mandate Case

On Dec. 12, a petition for certiorari was filed with the U.S. Supreme Court in Michigan Catholic Conference v. Burwell. (Docket entry). The full text of the petition is available on Westlaw at  2014 WL 7166539. In the case, the U.S. 6th Circuit Court of Appeals denied preliminary injunctions to several Catholic non-profit entities that object to the Affordable Care Act contraceptive coverage accommodation. (See prior posting.) BNA Daily Report for Executives [subscription required] reports on the filing of the petition.

Audio of 10th Circuit Arguments In 3 Non-Profit ACA Challenges Now Available

On Dec. 8, the U.S. 10th Circuit Court of Appeals heard oral arguments in three cases in which religious non-profits claim that the Obama Administration's regulations insufficiently accommodate their objections to the contraceptive coverage mandate under the Affordable Care Act.  The cases are Little Sisters of the Poor v. Burwell (see prior posting); Southern Nazarene University v. Burwell (see prior posting); and Reaching Souls International v. Burwell (see prior posting).  Links to audio recordings of all three arguments are now available from the court's website. [Thanks to Tom Rutledge for the lead.]

District Courts Reach Conflicting Results In Challenges To ACA Religious Non-Profit Contraceptive Accommodation

In Association of Christian Schools International v. Burwell, (D CO, Nov. 26, 2014), a Colorado federal district court upheld the Obama administration's most recent accommodation for religious non-profits that have conscience objections to the contraceptive coverage mandate under the Affordable Care Act.  The court rejected RFRA challenges by 5 non-profits, concluding that the accommodation "imposes a de minimis rather than a substantial burden on plaintiffs’ religious exercise."  The court explained:

All that plaintiffs are required to do under the new accommodation is provide a single sheet of paper that attests to their sincere religious objection and identifies their insurance provider or third-party administrator.... Plaintiffs claim that, by invoking the new accommodation via written notice, they would be “enabling the government’s scheme to facilitate free access to abortifacient services[.]”... But plaintiffs’ involvement with the administration of the mandate ends the moment they submit the written notice opting out of paying for contraceptive coverage. Plaintiffs’ objection is not to the notice they must submit to the government, but rather to the actions of third parties that will occur afterwards.

Plaintiffs in the case were educational institutions, a health care sharing organization and the legal advocacy organization Alliance Defending Freedom.

However, in Insight for Living Ministries v. Burwell, (ED TX, Nov 25, 2014), a Texas federal magistrate judge issued a preliminary injunction barring the federal government from enforcing the accommodation against a Christian radio broadcast ministry, saying:

The Court finds, and Defendants do not dispute, that IFLM holds sincere religious beliefs against providing certain drugs or devices which potentially could harm or kill a fertilized human egg. The accommodation compels or pressures IFLM to perform an act that it was not already performing. The nature of the accommodation provided by the Government would cause IFLM to facilitate, participate, and assist in, actions resulting in the provision of the abortionfacient drugs and renders IFLM complicit in providing its employees with what it contends are abortionfacient drugs....

Requiring IFLM to certify its objections to HHS (or to its TPA) requires IFLM to participate and act in the very arrangement to which it objects on the basis of its sincerely held religious beliefs. The Court therefore finds that IFLM is substantially burdened in its religious exercise.

SCOTUS Hobby Lobby Decision Implemented With Narrow Injunction

Last week, an Oklahoma federal district court implemented the U.S. Supreme Court's decision in the Hobby Lobby case, issuing a narrow injunction. In Hobby Lobby Stores, Inc. v. Sebelius, (WD OK, Nov. 19, 2014), the court enjoined the government from enforcing regulations under the Affordable Care Act "which require plaintiffs Hobby Lobby Stores, Inc. and Mardel, Inc. to provide their employees with health coverage for contraceptive methods, sterilization procedures, and related patient education and counseling to which plaintiffs' object on religious grounds...." The court refused to issue the broader injunction sought by plaintiff that would have enjoined enforcement of the statute, as well as the regulations, saying: "A broader order enjoining any potential application of the statute ... goes beyond what has been actually decided and litigated in this case."

DC Circuit Upholds ACA Contraceptive Compromise For Religious Non-Profits

The U.S. Court of Appeals for the D.C. Circuit today upheld the Obama administration's accommodation for religious non-profits that object to directly furnishing contraceptive coverage in their health insurance plans as required by regulations under the Affordable Care Act.  In Priests for LIfe v. U.S. Department of Health and Human Services, (DC Cir., Nov. 14, 2014), the unanimous 3-judge panel in an 86-page opinion written by Judge Cornelia Pillard said in part:

The regulatory opt out works simply: A religious organization that objects on religious grounds to including coverage for contraception in its health plan may so inform either the entity that issues or administers its group health plan or the Department of Health and Human Services. Delivery of the requisite notice extinguishes the religious organization’s obligation to contract, arrange, pay, or refer for any coverage that includes contraception. The regulations then require group health plan insurers or administrators to offer separate coverage for contraceptive services directly to insured women who want them, and to inform beneficiaries that the objecting employer has no role in facilitating that coverage....

We conclude that the challenged regulations do not impose a substantial burden on Plaintiffs’ religious exercise under RFRA. All Plaintiffs must do to opt out is express what they believe and seek what they want via a letter or two page form. That bit of paperwork is more straightforward and minimal than many that are staples of nonprofit organizations’ compliance with law in the modern administrative state. Religious nonprofits that opt out are excused from playing any role in the provision of contraceptive services, and they remain free to condemn contraception in the clearest terms. The ACA shifts to health insurers and administrators the obligation to pay for and provide contraceptive coverage for insured persons who would otherwise lose it as a result of the religious accommodation.

Even if, as Plaintiffs aver, we must take as dispositive their conviction that the accommodation involves them in providing contraception in a manner that substantially burdens their religious exercise, we would sustain the challenged regulations. A confluence of compelling interests supports maintaining seamless application of contraceptive coverage to insured individuals even as Plaintiffs are excused from providing it. That coverage offers adults and children the benefits of planning for healthy births and avoiding unwanted pregnancy, and it promotes preventive care that is as responsive to women’s health needs as it is to men’s. The accommodation requires as little as it can from the objectors while still serving the government’s compelling interests. Because the regulatory opt-out mechanism is the least restrictive means to serve compelling governmental interests, it is fully consistent with Plaintiffs’ rights under RFRA. We also find no merit in Plaintiffs’ additional claims under the Constitution and the Administrative Procedure Act.

Christian Science Monitor reports on the decision.

Preliminary Injunction Issued Against Latest Religious Non-Profit ACA Contraceptive Compromise

Yesterday a Florida federal district court handed down the first judicial decision on the Obama Administration's August 2014 Interim Final Rules that attempted to create a more acceptable compromise for religious non-profits subject to the Affordable Care Act contraceptive coverage mandate.  In Ave Maria University v. Burwell, (MD FL, Oct. 28, 2014), the court granted a preliminary injunction against enforcing the new rules against a religiously affiliated university.  The court relied heavily on the 11th Circuit's decision in late June granting an injunction pending appeal to Eternal Word Television Network, a religious broadcasting network that was challenging the prior version of the regulations accommodating religious non-profits. (See prior posting.) Explaining this reliance, the district court yesterday said:

In Eternal Word, under the 2013 Final Rules, an eligible organization was required to submit the Form 700 to its insurance issuer in order to self-certify....  Here, pursuant to the Interim Final Rules, Ave Maria may, instead, send a notice containing certain information about its insurance issuer and plan directly to HHS in order to self-certify. It is the Court’s conclusion that this distinction is not so significant as to warrant departure from the Eleventh Circuit’s precedent in Eternal Word. 

The court then stayed further proceedings in the case until the 11th Circuit decides the pending appeal in Eternal Word. Naples Daily News reports on the decision.

Notre Dame Asks For Supreme Court GVR In Contraceptive Coverage Challenge

On Oct. 3, a petition for certiorari was filed with the U.S. Supreme Court in University of Notre Dame v. Burwell, (Docket No. 14-392). In the case, the U.S. 7th Circuit Court of Appeals denied a preliminary injunction to Notre Dame in its challenge to the Affordable Care Act contraceptive coverage mandate as applied to religious non-profits. (See prior posting.) As reported by MSNBC, the petition does not seek full Supreme Court review, but instead asks the Court to grant certiorari, vacate the 7th Circuit's decision and remand for reconsideration ("GVR") in light of the Supreme Court's Hobby Lobby decision. In the petition, Notre Dame argued:

Just as a Mormon might refuse to hire a caterer that insisted on serving alcohol to his wedding guests, or a Jew might refuse to hire a caterer determined to serve pork at his son’s bar mitzvah, it violates Notre Dame’s religious beliefs to hire or maintain a relationship with any third party that will provide contraceptive coverage to its plan beneficiaries,

District Court Carries Out Supreme Court's Contraceptive Coverage Decision In Conestoga

The U.S. Supreme Court's Hobby Lobby opinion handed down last June also applied to the companion case of Conestoga Wood Specialties Corp. v. Burwell.  Since the 3rd Circuit in Conestoga had denied a preliminary injunction against enforcement of the contraceptive coverage mandate (see prior posting), the Supreme Court reversed the 3rd Circuit and remanded the case for further proceedings. Last week in Conestoga Wood Specialties Corp. v. Burwell, (ED PA, Oct. 2, 2014), the federal district court, in light of the Supreme Court's decision, issued a permanent injunction barring the government from enforcing the contraceptive coverage mandate against Conestoga as to those contraceptive services to which the company and its owners object on religious grounds. The court noted that if the proposed rules creating an accommodation for businesses asserting a religious objection are adopted, the government reserves the right to enforce the accommodation against Conestoga. Christian News reports on the court's action.

8th Circuit Invokes Hobby Lobby To Reverse In For-Profit Challenge To Contraceptive Mandate

Earlier this month in a per curiam two-paragraph order, the U.S. 8th Circuit Court of Appeals, invoking the Supreme Court's Hobby Lobby decision, reversed a Missouri federal district court's dismissal of a RFRA claim (see prior posting) by a for-profit company that objected to the contraceptive coverage mandate. The case is O'Brien v. U.S. Department of Health and Human Services, 8th Cir., Sept. 8, 2014). The 8th circuit also vacated and remanded the district court's dismissal of other claims in the case, without expressing a view on their merits.

Catholic Non-Profits Object To Newly Revised Contraceptive Mandate Rules

As reported yesterday by the Southwest Florida News-Press, Catholic non-profit instituitons have signaled their dissatisfaction with the Interim Final Rules under the Affordable Care Act issued last month in an attempt to meet objections to the contraceptive coverage mandate. (See prior posting.) In a Motion for Preliminary Injunction (full text) filed last week by the Becket Fund on behalf of Ave Maria University, the non-profit Catholic college takes issue with the government's claim that the new rules are consistent with the Supreme Court's order in the Wheaton College case:

The augmented rule demands far more than what the Supreme Court required in Wheaton, and, in fact, is substantively indistinguishable from the original rule that the Wheaton Court enjoined. Rather than simply requiring notice that Ave Maria is a religious nonprofit with a religious objection, the augmented rule would require Ave Marie to provide its insurance company’s name and contact information for the specific purpose of allowing HHS to issue a notice requiring the insurer to provide the exact same items through Ave Maria’s healthcare plan as if Ave Maria had given the insurer Form 700 directly. 

Simply routing the form through HHS is a distinction without a difference....

8th Circuit Hears Oral Arguments In Individuals' Religious Challenge To Contraceptive Coverage Mandate

The U.S. 8th Circuit Court of Appeals yesterday heard oral arguments (recording of full arguments) in Wieland v. Department of Health and Human Services. In the case, a Missouri federal district court denied a temporary restraining order to a Missouri state employee and his wife who claim that the Affordable Care Act contraceptive coverage mandate forces them to violate their religious opposition to contraception, sterilization, and abortifacients by requiring their group health insurance policy to make these services available to their daughters who are covered by the policy.  The trial court held that plaintiffs lack standing to sue. (See prior posting.) The Kansas City Star reports on yesterday's arguments in which appellants rely on the Supreme Court's Hobby Lobby decision. Appellants argued that the mandate is equivalent to requiring Mormon parents, whose religion forbids alcohol use, to stock unlocked liquor cabinets for their children’s use when parents are not home.

8th Circuit: Small Employer Lacks Standing To Challenge Contraceptive Coverage Mandate

Annex Medical, Inc. v. Burwell, (8th Cir., Sept. 5, 2014) presents a new twist on the contraceptive coverage mandate issue decided by the Supreme Court in Hobby Lobby.  In the case, the district court had denied a preliminary injunction, but the 8th Circuit Court of Appeals then granted a preliminary injunction pending appeal. Now in a 2-1 decision, the  8th Circuit vacates the district court's order, holding that an employer of under 50 employees lacks standing to challenge the contraceptive coverage mandate on religious grounds.

Important to the majority's decision is its reading of a provision of the Internal Revenue Code which many have seen as imposing a $100 per day excise tax on a small employer that chooses voluntarily to provide its employees health insurance, but insurance that not cover contraceptive services.  The court concludes that 26 USC Sec. 4980D(d) precludes penalizing the company if it offers insurance from a health insurer which is inconsistent with the contraceptive mandate.

The company complains however that no insurance company will write a policy that excludes contraceptive coverage because federal law prohibits the insurance company from doing so. The majority writes:

The standing problem is the pleadings and record contain no indication any Minnesota health insurer is willing, but for the mandate, to sell a plan allowing a small employer such as Annex to prohibit coverage for a handful of healthcare products and services....

Based on the pleadings and sparse record before us, we can only speculate whether Annex’s difficulties obtaining contraceptive-free insurance are (1) caused by the government defendants as opposed to the independent decisions of third-party insurers, and (2) redressable by the remedy available to Annex: a permanent version of the preliminary injunction Annex already received and which failed to redress Annex’s alleged injury.

Judge Colloton, concurring, argues that Annex has standing:

it should be evident that a market to serve Annex Medical is likely to develop if the requested relief is granted. It is unsurprising that insurers were not prepared to write policies for Annex Medical and submit them to state regulators for approval based on a temporary injunction pending appeal of indefinite duration while the law was unsettled. But the complaint seeks permanent injunctive and declaratory relief that the government cannot forbid the issuance of the group plan that Annex Medical wants to purchase.

[Thanks to Stephen Blakeman for the lead.] 

Federal Agencies Act To Expand Exemptions To Contraceptive Madate For Religious Objectors

Federal agencies today issued two relases on changes to the contraceptive coverage mandate under the Affordable Care Act.  The first Release adopts interim final rules for non-profit religious charities and educational instituitons that have objections to providing contraceptive coverage. The changes react to the order the Supreme Court issued in the Wheaton College:

These interim final regulations amend the Departments’ July 2013 final regulations to provide an alternative process for the sponsor of a group health plan or an institution of higher education to provide notice of its religious objection to coverage of all or a subset of contraceptive services, as an alternative to the EBSA Form 700 method of self-certification. These interim final regulations continue to allow eligible organizations to use EBSA Form 700....

The alternative process ... is consistent with the Wheaton order. It provides that an eligible organization may notify HHS in writing of its religious objection to coverage of all or a subset of contraceptive services. The notice must include the name of the eligible organization and the basis on which it qualifies for an accommodation; its objection based on sincerely held religious beliefs to providing coverage of some or all contraceptive services (including an identification of the subset of contraceptive services to which coverage the eligible organization objects, if applicable); the plan name and type ...  and the name and contact information for any of the plan’s third party administrators and health insurance issuers.....

When an eligible organization that establishes or maintains or arranges a self-insured plan subject to ERISA provides such a notice to HHS, DOL (working with HHS) will send a separate notification to each third party administrator of the ERISA plan. DOL’s notification will inform each third party administrator of the eligible organization’s religious objection to funding or administering some or all contraceptive coverage and will designate the relevant third party administrator(s) as plan administrator under section 3(16) of ERISA for those contraceptive benefits that the third party administrator would otherwise manage. The DOL notification will be an instrument under which the plan is operated and shall supersede any earlier designation....

If an eligible organization that establishes or maintains an insured health plan provides a notice to HHS under this alternative process, HHS will send a separate notification to the plan’s health insurance issuer(s) informing the issuer(s) that HHS has received a notice under §2590.715-2713A(c)(1) and describing the obligations of the issuer(s) under § 2590.715-2713A. Issuers remain responsible for compliance with the statutory and regulatory requirement to provide coverage for contraceptive services to participants and beneficiaries, and to enrollees and dependents of student health plans, notwithstanding that the policyholder is an eligible organization with a religious objection to contraceptive coverage that will not have to contract, arrange, pay, or refer for such coverage. 

The second Release propses amendments as to for-profit entities with religious objections, responding to the Supreme Court's Hobby Lobby decision.  As summarized in the Release:

In light of the Court’s decision in Hobby Lobby, the Departments propose to amend the definition of an eligible organization under the July 2013 final regulations to include a closely held for-profit entity that has a religious objection to providing coverage for some or all of the contraceptive services otherwise required to be covered. Under these proposed rules, a qualifying closely held for-profit entity that has a religious objection to providing coverage for some or all of the contraceptive services otherwise required to be covered would not be required to contract, arrange, pay or refer for contraceptive coverage; instead, payments for contraceptive services provided to participants and beneficiaries in the eligible organization’s plan would be provided separately by an issuer ...  or arranged separately by a third party administrator ....

In considering inclusion of certain closely held for-profit entities ..., the Departments are considering and seek comment on how to define a qualifying closely held for-profit entity.... [T]he Departments are proposing for comment two possible approaches to defining a qualifying closely held for-profit entity.... Under the first proposed approach, a qualifying closely held for-profit entity would be an entity where none of the ownership interests in the entity is publicly traded and where the entity has fewer than a specified number of shareholders or owners...... Under a second, altertnative approach, a qualifying closely held entituy would be a for-profit entity in which a specified fraction of the ownership interest is concentrated in a limited and specified number of owners.

Pennsylvania Diocese Gets Permanent Injunction Against ACA Contraceptive Mandate

In Brandt v. Burwell, (WD PA, Aug. 20, 2014), a Pennsylvania federal district court issued a permanent injunction under RFRA against requiring the Diocese of Greensburg, Pennsylvania and affiliated organizations to comply with the  compromise rules under the Affordable Care Act contraceptive coverage mandate.  In its 53-page opinion, the court said in part:

Here, the issue is whether Plaintiffs, being non-secular in nature, have successfully proven that their right to freely exercise their religion under RFRA has been substantially burdened by the “accommodation,” which requires the Bishop of Greensburg (or his designees) to sign a form (EBSA Form 700) that thereby facilitates/initiates the provision of contraceptive products, services, and counseling. Based upon the evidence of record as set forth in the Court’s factual findings, this Court concludes that the accommodation substantially burdens Plaintiffs’right to freely exercise their religion.

Trib Total Meida reports on the decision. The court had previously issued a preliminary injunction in the case. (See prior posting.)

Religious Non-Profit College Wins Attack on Contraceptive Mandate Compromise

In Louisiana College v. Sebelius, (WD LA, Aug. 13, 2014), a Louisiana federal district court granted summary judgment to Louisiana College on its claim that its rights under RFRA are infringed by the Affordable Care Act contraceptive coverage accommodation for religious non-profits.  The college is affiliated with the Southern Baptist Convention, and offers it employees a self-insured plan through a third party administrator that is also an SBC affiliate.  The court held that the requirement that plaintiff self-certify its objections, or else incur onerous penalties, creates a substantial burden on its free exercise because of its religious objections to facilitating access to contraceptive methods it deem abortifacients. The government failed to show that the compromise was the least restrictive means to achieve a compelling governmental interest. The Shreveport Times reports on the decision.

DC Circuit Acts On Case Remanded After Hobby Lobby

As previously reported, after the U.S. Supreme Court decided the Hobby Lobby case allowing for-profit-businesses to assert religious objections to the Affordable Care Act's contraceptive coverage mandate, it remanded three other cases on its docket posing the same issue. In what appears to be the first Circuit Court to act on the remand, the D.C. Circuit last week entered an order in Gilardi v. HHS (Aug. 8, 2014) providing:

it is ORDERED and ADJUDGED that the case be remanded to the district court with instructions to enter a preliminary injunction for the Freshway companies and to reconsider the denial of the preliminary injunction as to the individual owners in light of Burwell v. Hobby Lobby Stores, Inc., 134 S. Ct. 2751 (2014).

Yesterday's Insurance Journal reports on the order. In the case, the D.C. Circuit Court had originally rejected the claim that secular corporations have free exercise rights, but had remanded to the district court for further findings the claims of the individual owners. The ruling on corporate rights had been appealed to the Supreme Court. (See prior posting.)

Little attention has been given to the fact that plaintiffs in the case asserted, consistent with their Catholic beliefs, that they have religious objections to all atificial contraception, not just the limited number of contraceptive methods involved in Hobby Lobby. (Gilardi complaint.) Apparently last week's D.C. Circuit Court order requires the district court to issue an injunction protecting these broader objections.