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SCOTUS Upholds ACA Contraceptive Rule Exemptions

Jul 17, 2020 decorative image

On July 8, 2020, the Supreme Court of the United States (SCOTUS) upheld two regulations expanding exemptions from the contraceptive coverage mandate under the Affordable Care Act (ACA). Under the regulations, plan sponsors that object to providing contraceptive coverage based on sincerely held religious beliefs or moral convictions will not be penalized for failing to include contraceptive coverage in the plan’s benefits.

Background

The ACA requires non-grandfathered health plans to cover certain women’s preventive health services without cost-sharing, including all FDA-approved contraceptives. Religious exemptions apply to certain churches, houses of worship, and other church-affiliated institutions, which allows them to choose not to contract, arrange, pay or refer for any contraceptive coverage.

In October 2017, the Trump administration issued two interim final rules that expanded the availability of the exemption for employers that object to providing contraceptive coverage based on their religious beliefs, and provide an additional exemption for employers that object to providing contraceptive coverage based on their moral convictions (but not religious beliefs). In November 2018, the rules were finalized in substantially the same format and scheduled to take effect on January 14, 2019.

However, on January 13 and 14, 2019, two federal courts issued preliminary injunctions that halted the regulations from taking effect.

Court Ruling and Impact

In a 7-2 decision, the Supreme Court ruled that the Trump administration had the authority under the ACA to provide exemptions from the contraceptive mandate for employers with religious and conscientious objections. The Supreme Court remanded the case to the lower courts to dissolve a nationwide preliminary injunction temporarily preventing the regulations from taking effect. As a result, additional employers may now be able to opt out of providing the ACA-mandated contraceptive coverage.

Reach out to your Hylant representative for further information.

The above information does not constitute advice. Always contact your employee benefits broker or trusted adviser for insurance-related questions.