The Supreme Court sidesteps the free exercise claim and grants government agencies the power to determine whether to apply the ACA contraceptive mandates to employers. 

[dc]T[/dc]his week, the Supreme Court issued a decision widely viewed as a victory for the free exercise of rights of religious organizations to be exempt from providing contraceptive coverage. However, the Supreme Court did not squarely address contraceptive coverage requirements in light of the free exercise rights of employers – instead – it deferred decision making to government agencies, which change from administration to administration.

The way this case works is a bit complicated, so here’s a quick summary:

  1. In Little Sisters of the Poor v. Pennsylvania (decided July 8, 2020), the Supreme Court addressed a provision in the Affordable Care Act of 2010 (ACA, aka “Obamacare”) that required covered employers to provide women with “preventative care and screenings.”
  2. What counts as “preventative care and screenings” is at the discretion of the Health Resources and Services Administration (HRSA).
  3. The HRSA’s current guidelines include coverage for all Food and Drug Administration (FDA) approved contraceptive methods.
  4. The Departments of Health and Human Services, Labor, and the Treasury (Departments) give the HRSA discretion of whether to exempt religious employers from providing contraceptive coverage, so long as they do not blatantly violate employers’ rights under the Religious Freedom Restoration Act.
  5. Appointees for the current administration lead the Departments. In this case, the Trump administration, or next year perhaps the Biden administration.

The Supreme Court previously issued holdings in two cases involving employer-requested exemptions from contraceptive coverage. In Burwell v. Hobby Lobby, the Court held that the contraceptive mandate substantially burdened the free exercise of religion of a “closely held corporation.” In Zubik v. Burwell, the Court remanded the matter back to the departments so they could find an approach that would satisfy both religious employers and women seeking contraceptive coverage.

This week, the Court ruled that the Departments had the authority under the ACA to promulgate rules addressing religious and moral exemptions.  In implementing their rules on contraceptive coverage,  Departments should consider whether the requirement is in keeping with the Religious Freedom Restoration Act (RFRA) to avoid claims that they acted arbitrarily or capriciously.

Justice Thomas authored the majority opinion, which focused on procedural issues concerning whether the Departments had the power to issue both religious exemptions and moral exemptions for secular organizations. Yes, he wrote, they had the statutory authority to “craft that exemption,” and the rules were also free from procedural defects. Therefore the rules are valid.

Justice Alito addresses RFRA in his concurring opinion. She notes that even though there is a constitutional right to purchase and use contraceptives (Griswold v. Connecticut), “the Court has never held that there is a constitutional right to free contraceptives.”

While Justices Ginsburg and Sotomayor take a purist approach in their dissent, arguing that failing to require contraceptive coverage violates the health care needs of women, Justice Kagan issues a concurrence that focuses on the power of the Departments to enforce current rules. Justice Kagan notes that the Departments cannot issue a regulation that expands exemptions fro the mandate, but that they “have wide latitude over exemptions, so long as they satisfy the requirements of reasoned decisionmaking.”

In many ways, Kagan’s concurring opinion is a clear restatement of the holding of the court. While the majority opinion omits the term,  Kagan says that Chevron deference” applies. Chevron deference is the rule from the 1984 case of Chevron USA v. Natural Resources Defense Council that whenever the scope of an agency’s statutory authority is questioned, courts “should accede to a reasonable interpretation by the implementing agency” because “the agency is the more politically accountable actor.” Also, as described by Kagan, “the agency’s expertise often enables a sounder assessment of which reading best fits the statutory scheme.”

In other words, if there are two interpretations, the tie goes to the agency. And, as Kagan points out, throughout the last two administrations, “the Departments have shifted positions on may questions” involving the ACA, but “not on whether Amendment gives HRSA the ability to create exemptions to the contraceptive coverage mandate.”

Kagan then continues, while concurring with the majority that the agencies have the authority, by arguing that the agencies may have made the wrong call on this and probably should reevaluate whether to grant such exemptions, and while there may be authority for a religious exemption, there may not be for a moral exemption.  Yet she defers that issue of whether secular or publicly traded corporations may claim a religious exemption.

Those who hoped that the Court would recognize a free exercise right to a religious or moral exemption to the contraceptive mandate may find themselves litigating the issues again in a few years after they find that the Departments, under new leadership, have used their discretion to eliminate the exemption.

In short, the survival of the current contraception coverage exemptions depends on whether the current administration is replaced by voters this November.

Little Sisters of the Poor v. Pennsylvania (decided July 8, 2020)


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