Court Punts on ACA Question

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On May 16, 2016, the U.S. Supreme Court kicked the proverbial can down the road on one Affordable Care Act (ACA) issue – contraceptive coverage.  At issue in Zubik v. Burwell is the extent to which religiously affiliated employers, such as hospitals and universities, must provide their employees access to contraceptive coverage.

The ACA requires non-grandfathered group health plans to cover certain preventive health services with no cost-sharing, including FDA-approved contraceptive methods and counseling.  Group health plans maintained by religious employers, such as churches, are exempt from the contraceptive requirement.

Religiously affiliated employers are not exempt but those with religious objections to covering some, or all, of the mandated contraceptive services are eligible for an “accommodation” that ensures they are not required to directly provide or pay for coverage but that also ensures their employees will have access to contraceptive coverage.

These employers can self-certify on EBSA Form 700 or provide written notice to the Department of Health and Human Services stating they are a non-profit entity that holds itself out as a religious organization and they oppose providing contraceptive coverage on religious grounds.  Upon receipt of Form 700 or written notice, the carrier or third-party administrator must arrange and pay for the contraceptive coverage.

Several religiously affiliated employers challenged the accommodation by arguing they should be treated similarly as religious employers and exempt from the requirement.  They assert that filing paperwork to claim the “accommodation” constitutes a substantial burden on their religious liberty in violation of the Religious Freedom Restoration Act (RFRA).  However, if they do not file the paperwork and claim the “accommodation,” they face substantial penalties for not providing contraceptive coverage.

Oral arguments were held on March 23, 2016.  Shortly thereafter, the Court made an unusual move when it asked the parties to provide supplemental briefings on possible compromises to the dispute.  The request was clearly an attempt to break a 4-4 deadlock on the Court, which was apparently not successful.

On May 16, 2016, the Court issued a ruling that “expresses no views on the merits of the case.”  Instead, the Court remanded the cases to the various appellate courts with instructions to give the parties time “to resolve any outstanding issues between them.”  The opinion noted it “is feasible” the parties could find a compromise that provided the required contraceptive coverage without requiring notice from the employers.

It remains to be seen whether such a compromise can be reached but it’s very likely some, or all, of the cases will wind up back at the Court.  Hopefully, the Court will have a full contingent of 9 justices by then.