Health Reform WK-EDGE Employers win objection to certain contraception coverage based on religious beliefs
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Friday, May 17, 2019

Employers win objection to certain contraception coverage based on religious beliefs

By Cathleen Calhoun, J.D.

An employers alliance goes for no fines and permanent relief after refusing to cover what it calls "abortion-causing" contraceptive, but will it get everything it asked for?

In a challenge to a certain aspect the Affordable Care Act’s (ACA) (P.L. 111-148) contraceptive mandate based on religious beliefs, an employers alliance won its argument against providing coverage for what it referred to as "abortion-causing" drugs. The U.S. District Court for the District of North Dakota granted current and future employers of the employers alliance permanent injunctive relief. The defendants, agencies that created and enforce the mandate that contraception must be covered, had already concluded that requiring employers with sincerely held religious objections to comply would violate the Religious Freedom Restoration Act (RFRA) (P.L. 103-141), but argued that only current members of the employers alliance should be granted relief and that fines should still be imposed. The court disagreed, noting the odds of repetitive litigation and its jurisdiction (Christian Employers Alliance v. Azar, May 15, 2019, Hovland, D.)

Contraceptive mandate. The ACA’s contraceptive mandate requires health plans to include preventative care and screenings for women, including contraceptives. The employers alliance had no objection to providing coverage for what they referred to as non-abortion causing contraceptive drugs and devices. They religiously objected to contraceptives that prevented a fertilized egg from implanting in the mother’s uterus.

Penalties. The contraceptive mandate has multiple enforcement mechanisms, including two penalties in the Internal Revenue Code. Specifically, employers who offer a plan without all the contraception options face an excise tax of $100 per covered beneficiary, per year ($36,500 annually). If such employers drop all health insurance, they face a $2,000 per employee penalty, per year. The defendants argued that the IRS should not be restrained from collecting payments and that no injunctive relief should extend to future members of the employment alliance.

Analysis. The court found that the Anti-Injunction Act ("AIA") did not deprive the court of jurisdiction to restrain the IRS from collecting the assessable payment imposed for failure to provide health insurance, because the assessable payment is not a tax. If Congress had intended it to be a tax, it would have used the word "tax," according to the court. Regarding future members of the employers alliance, the plaintiff argued, and the court agreed, that limiting relief to current members would result in an unending cycle of litigation. Finally, the court also agreed to declare that "…members comply with their obligations under the Affordable Care Act and defendants’ regulations…by offering otherwise compliant health plans that exclude abortifacient services and related patient education and counseling." The court reasoned that a private right of action by third parties may exist if the requested language were not included in the declaration.

Conclusion. The court found that a permanent injunction and declaratory relief were warranted, especially due to the defendants’ concession on the merits of the RFRA claim. The Court permanently enjoined and restrained the defendants from enforcing the substantive requirements imposed in 42 U.S.C. § 300gg-13(a)(4) and from collecting assessments. The court also declared any assessments that have accumulated void and eliminated.

The case is No. 3:16-cv-309

Attorneys: Ian S. Speir (Nussbaum Speir PLLC) for Christian Employers Alliance, Trinity Bible College & Graduate School and Treasure Island Coins, Inc. Michelle R. Bennett, U.S. Department of Justice, for Alex M. Azar, II.

Companies: Christian Employers Alliance; Trinity Bible College & Graduate School; Treasure Island Coins, Inc.

Cases: CaseDecisions AccessNews ContraceptionCoverageNews NorthDakotaNews NewsFeed

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