photo of pill blister pack lying on wet road by Surija Sray on Flickr cc 2.0 attributiion

It is possible that this decision will increase the freedoms that the companies involved sought to restrict. Freedom is tricky that way. -Heather Bussing Photo: “All the contraceptive pills are gone…” by Surija *Sray* is licensed under CC BY 2.0

There has been a tremendous amount of rhetoric about the Hobby Lobby case, along with the exaggeration and misinformation that comes along with a Supreme Court case that touches personal rights and strongly held beliefs. So here is a summary of what the case was about, who is directly affected by the decision, and the issues raised by the decision.

What the Case Was About

The Religious Freedom Restoration Act of 1993 limits the government’s power to enforce a law against someone when complying with the law would “substantially burden” that person’s sincerely held religious beliefs. In order to enforce the law, the government has to show 1) there is a “compelling governmental interest,” and 2) that the law is the least restrictive way to achieve that interest. 

So the law can be enforced even though it affects someone’s religious beliefs, but it has to put the least possible burden on the practice of the religion. This sounds reasonable, but can be extremely difficult to apply in practice.

In 2010, Obamacare (the Affordable Care Act) was passed, which required employers who offer health insurance benefits to provide insurance coverage for birth control. This caused problems with religions that believe life begins at conception because some forms of birth control prevent a fertilized egg from implanting in the uterus. 

The Hobby Lobby case deals only with 4 kinds of contraception, 2 IUD’s and 2 Morning-after pills that potentially interfere with a fertilized egg. The case does not affect most types of other contraception including birth control pills, sterilization, or barrier methods such as condoms and sponges.

In deference to those religions that believe these types of contraception are immoral, the regulations interpreting the ACA allowed churches and religious non-profits to opt-out of providing insurance coverage for them.

For-profit companies are not exempt from providing contraception benefits because they are businesses, not churches.

Hobby Lobby and two other small businesses sued saying that the contraception coverage provisions of the ACA violated their exercise of religion under the Religious Freedom Restoration Act. They also claimed that providing the coverage violated their First Amendment rights to free exercise of religion.

So the actual issue before the court was whether these particular companies could also opt-out of providing insurance coverage for the 4 types of contraception they objected to, even though they were not churches or religious non-profit entities.

The Court’s Analysis

First, the Court had to figure out if a company, rather than a human, could have religious beliefs. Since the companies involved in this lawsuit were all closely held (majority owned by a few people), the court had no trouble deciding that the company’s religious beliefs were the same as its owners, and that companies are legally capable of exercising religion. 

The Court then had to decide whether those beliefs were being substantially burdened by providing insurance for contraception. Since the choice was either to provide a policy that had contraception benefits that were against the owners’ religious beliefs or not to offer health insurance benefits at all and pay the fine, the Court found there was a substantial burden.

Then the Court applied the test under the RFRA to see if the government could enforce the law anyway. Without making any real determination one way or the other, the Court assumed the government had a compelling interest in making sure that women could obtain birth control under their health insurance. 

The next question was whether requiring companies to provide the coverage was the least burdensome method of providing the contraceptive to people who were insured and wanted it. Since the law already provided exceptions based on religious beliefs, and those exceptions still made the contraception free and available to anyone insured under the ACA, then requiring the companies to provide the coverage was not the least restrictive method of achieving the purpose of the law.

In other words, the law says that people who are insured and want contraception will receive it, whether or not it was specifically covered in that employer’s policy. So that exception could also apply to companies as well as religious organizations and non-profits.

The ruling is that only closely-held corporations who have religious objections to the contraception provisions can opt-out. At this point, larger companies and companies with more owners cannot opt-out.

As a practical matter, this does not affect many employees. It is true that most businesses in the US are small businesses, but most of them have no employees or are exempt from the ACA because they have fewer than 50 employees. Only about 20% of US businesses have employees. Of approximately 121 million paid employees, only 21 million work for companies with fewer than 100 employees. So, 83% of US employees work for companies with more than 100 employees.

Whether the Companies Are Paying for the Contraception

The religious exemption doesn’t really affect what the entities are paying and not paying for. Under the Church exemption, the entity can opt out by registering with the insurance exchange. The result is that certain types of coverage are not included in their health insurance plans. 

But the medical providers (doctors/clinics) are still required to provide contraceptive services to any covered person who wants them. It’s just the billing that is different.

Since the cost of these services are so small, it just gets covered through the overall premiums collected under the ACA policies. It does not appear that objecting entities get a discount on their insurance premiums. So, although they don’t technically have the coverage, they pay the same premiums. 

I think the difference is that insurers can’t ask these companies to pay a portion of the services when someone who works there actually gets an IUD or Morning-after pill.

But the companies are still ultimately paying for the services, either through their premiums or through taxes if the government picks up the cost of the services. So not having coverage is mostly symbolic.

Practical Effect on Availability of Contraception

Probably none. The Court suggested that the government pick up the employer’s cost of these services, just as it does for employees of churches and religious nonprofits. This will likely happen. In the meantime, coverage for most contraception is not affected.

So, What’s All the Fuss?

The real controversy about the Hobby Lobby decision arises because the United States Supreme Court has decided for the first time that corporations can have religious beliefs, and that they can opt-out of certain laws based on those beliefs.

The Court did say that companies still cannot discriminate in other areas based on religion. It specifically said that the decision does not affect employment discrimination laws.

The Court also noted it would be difficult to determine the religious beliefs of corporations with more diverse owners. But the idea that a corporation can declare its religion and then get out of complying with law is a quagmire that will keep lawyers and pundits busy for years.

Already, companies are seeking to be able to refuse services to gay people based on their religious beliefs that being gay is a sin. There are also cases where churches have demanded complete exemption from Obamacare because they see signing the opt-out form as “a permission slip for abortion.” So there will certainly be many more cases testing the boundaries of when a business can be exempt from law based on religion.

The flip side is that the Court has clearly stated that one’s beliefs about abortion and contraception are religious issues. While the Court was careful to limit the decision to the RFRA rather than the First Amendment, the decision is the first time the Court has expressly talked about abortion as a fundamental question of religious belief.

I believe this will make it difficult for legislatures and Congress to make laws that affect whether someone can obtain an abortion and under what circumstances. To do so would be the government wading into the exercise of religion, which is expressly prohibited under the First Amendment. To make a law one way or the other would be taking sides in the abortion debate and adopting one religious belief over another that would violates the Establishment Clause: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.” 

In Roe v. Wade, the Court side-stepped the religion argument. Instead, it  focused on the viability of the fetus to determine when it was entitled to legal protection independent of the rights of the mother. With developments in technology, viability is becoming almost meaningless. This and related cases will force the discussion back to the freedom of the pregnant woman to decide for herself whether to continue a pregnancy based on her own person religious beliefs and the circumstances of her life. So it is possible that this decision will increase the freedoms that the companies involved sought to restrict.

Freedom is tricky that way.

Bottom Line

  • Only closely held companies who are subject to the ACA and have a religious objection to providing health insurance coverage for IUD’s and Morning-after pills are directly affected by this decision.
  • Most employers are not closely held companies, nor do they have opinions, religious or otherwise, about their employees’ birth control decisions.
  • To the extent your company does, it is likely that there will be a mechanism to allow such companies to opt-out of providing insurance coverage for IUD’s and Morning-after pills. But the contraception will probably be available to them anyway through the government.

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