This morning, the U.S. Supreme Court, in a 5-4 ruling in Burwell v. Hobby Lobby,
held that PPACAs contraceptive mandate, as it applies to closely held
for-profit employers, violates the Religious Freedom Restoration Act of 1993
(RFRA). As background, PPACA requires non-grandfathered group health plans to
provide coverage for womenҒs preventive services including Food and Drug
Administration-approved contraceptive services (e.g., birth control) ֖ with
zero cost-sharing to the participant. On the contraceptive services, there is a
limited exception for religious employers and their affiliates. However, that
exception does not extend to private for-profit employers.
The U.S. Supreme Court held that the government failed to show that the contraceptive coverage mandate is the least restrictive means of advancing its interest in guaranteeing cost-free access to birth control. Thus, PPACAs contraceptive mandate cannot be imposed on a closely held for-profit company, meaning such companies do not have to provide contraceptive coverage at zero-cost sharing. Importantly, the ruling is limited only to the contraceptive mandate, and should not be understood to mean that all insurance mandates (e.g., those for blood transfusions or vaccinations) necessarily fail if they conflict with an employerҒs religious beliefs.
Finally, the ruling
applies specifically to closely held corporations,Ӕ a term generally defined
by state corporate law, but which very generally includes companies whose stock
is not publicly traded and whose ownership is controlled by members of a single
family or a limited number of investors. Thus, the ruling does not appear to
apply broadly to other for-profit companies, such as publicly traded
corporations; rather, it applies only to those that are closely held by
families and limited investors with sincere religious beliefs. It remains
unclear whether closely held corporations will be required to certify their
religious objections; future guidance will hopefully address that issue.
Source: Our benefits partner, NFP Benefits Compliance.
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