The government has released a joint agency rule finalizing and expanding the exemption from the contraceptive coverage mandate under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) for various entities and individuals on the basis of sincerely held religious beliefs. Entities that have sincerely held religious beliefs against providing contraceptive services (or services which they consider to be abortifacients) would be exempt from the mandate and no longer be required to provide such coverage.
Under ACA, employer-provided health insurance plans are required to cover certain “preventative services” which were defined through guidance as including all contraception methods approved by the Food and Drug Administration, including methods viewed by some individuals and employers as abortifacients, and sterilization procedures.
The previous administration created an accommodation for religious non-profits and, after the Supreme Court’s decision in Hobby Lobby, for closely held for-profit organizations that had religious objections to covering some or all contraceptives. Under the accommodation, the entity’s insurer or third party administrator was responsible for providing contraceptive services to the entity’s plan participants and beneficiaries.
The final rule maintains the availability of the accommodation, in which the entity’s insurer or third party administrator is responsible for providing contraceptive services to the entity’s plan participants and beneficiaries, but they make it voluntary, at the option of the entity. That is, an otherwise exempt entity can elect to take advantage of the accommodation, which would provide contraceptive coverage to its employees and their dependents. Entities that object to covering some, but not all, contraceptive items would be exempt with respect to only those methods to which they object.
This rule was issued hand in hand with another final rule that exempts entities from providing contraception services based on their strongly held religious beliefs.
The entities exempted from providing an otherwise mandated contraceptive item or service (or an item or services which they consider to be abortifacient) to which they object on the basis of their religious beliefs or moral convictions include:
– Churches, integrated auxiliaries, and religious orders with religious objections;
– Nonprofit organizations with religious or moral objections;
– For-profit entities that are not publicly traded, with religious or moral objections;
– For-profit entities that are publicly traded, with religious objections;
– Other nongovernmental employers with religious objections;
– Nongovernmental institutions of higher education with religious or moral objections;
– Individuals with religious or moral objections, with employer sponsored or individual market coverage, where the plan sponsor and/or issuer (as applicable) are willing to offer them a plan omitting contraceptive coverage to which they object;
– Issuers with religious or moral objections, to the extent they provide coverage to a plan sponsor or individual that is also exempt.
The Departments estimate the exemptions granted by the final rules should affect no more than approximately 200 employers with religious or moral objections, with many entities not being affected because they were already permitted not to cover contraceptives under the previous rules, or are protected by permanent court injunctions. The Departments estimate the exemptions may affect the coverage of approximately 6,400 women, and state that in no case will they impact more than 127,000 women.
Code Sec. 9815
CCH Reference – 2018FED ¶44,089HV
CCH Reference – 2018FED ¶44,089IB
Tax Research Consultant
CCH Reference – TRC HEALTH: 9,114.25