High Court Punts Again on Challenge By a Nonprofit to Contraceptive Mandate

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By Mary Anne Pazanowski

April 27 — For the second time, the U.S. Supreme Court has sent back to an appeals court a case testing nonprofit religious organizations' obligation to comply with regulations implementing the Affordable Care Act's women's health provisions.

The issue of whether such groups must provide their employees with health plans that cover contraceptive drugs, devices and related services at no cost, despite their religious objections to doing so, has divided federal district courts but found surprising unanimity among appeals courts.

To date, every appeals court to have considered the issue of whether the regulations, as modified by an accommodation for nonprofit religious organizations, substantially burdens their right to practice their religion in violation of the Religious Freedom Restoration Act (RFRA), 42 U.S.C. § 2000bb, has rejected the argument.

That includes the U.S. Court of Appeals for the Sixth Circuit, which in June 2014 affirmed the denial of a request for an injunction prohibiting the government from enforcing the regulations against the faith-based plaintiffs. The plaintiffs in December 2014 asked the Supreme Court for review, and the court granted review, vacated the decision and remanded the case to the appeals court.

The Sixth Circuit had followed the reasoning of the U.S. Court of Appeals for the Seventh Circuit, which held previously that the accommodation relieved religious nonprofits of an obligation to provide the objected-to coverage and that their certification of their position to the government didn't facilitate or trigger the coverage. The Supreme Court granted review on that decision, vacated it and sent it back to the appeals court in March. The appeals court heard oral arguments April 22.

Normal Procedure

Leila Abolfazli, senior counsel in the Health and Reproductive Rights Program at the National Women's Law Center in Washington, told Bloomberg BNA that she doesn't read too much into the Supreme Court's order addressing the Sixth Circuit's decision that the Michigan Catholic Conference and other plaintiffs likely wouldn't succeed in their RFRA challenge.

Asking an appeals court to take a second look at a decision that was issued prior to a major Supreme Court ruling on a similar issue “is a normal procedure,” she said. In this instance, the Catholic group argued that the Sixth Circuit might have ruled differently had it had the benefit of the Supreme Court's ruling in Burwell v. Hobby Lobby Stores, Inc., 2014 BL 180313 (U.S. June 30, 2014). In that decision, the high court said the so-called contraceptive mandate violated RFRA with respect to closely held for-profit corporations whose owners objected to providing the coverage on religious grounds.

As pointed out by the government in various cases, the contraceptive mandate as applied to nonprofit religious organizations differs from the version of the regulations applied to for-profit companies because the government developed an accommodation by which religious groups may opt out of directly providing the insurance. The challengers argued that, even under the accommodation, the regulations require them to take action that offends their religious beliefs.

Win for Religious Groups

Mark Rienzi, senior counsel of the Becket Fund for Religious Liberty in Washington, said the court's action sends “a strong signal that the Supreme Court will ultimately reject the government’s narrow view of religious liberty.”

Becket, which filed an amicus brief in the case, said that this is “the sixth time in a row” that the Supreme Court has taken “steps to protect another religious objector from the contraceptive mandate.” It pointed out that the court has issued emergency orders in several cases, most recently one involving two Pennsylvania Roman Catholic dioceses in the U.S. Court of Appeals for the Third Circuit, that preclude the government from enforcing the mandate against nonprofit religious organizations.

According to Rienzi, the “government keeps making the same bad arguments and the Supreme Court keeps rejecting them—every single time. This is because the government can obviously come up with ways to distribute contraceptives without the forced involvement of Catholic ministries.”

Becket said that lower courts, given the high court's decision to grant review and vacate in the Sixth Circuit case, are “less likely” to “accept arguments the Supreme Court has rejected over and over and over again.”

Outcome Not Certain

Abolfazli said, however, that the Supreme Court's actions so far don't necessarily represent a setback for the government in its push to implement the contraceptive coverage regulations. Several appeals courts heard oral argument on the issue in December 2014 and the first quarter of 2015.

It “remains to be seen what will happen in those circuits,” she said.

Additionally, she said she doesn't foresee the Sixth or Seventh Circuit changing their decisions. And Justice Samuel A. Alito's emergency order in the Third Circuit case merely gave the challengers relief from an order allowing enforcement of the mandate pending their completion of a petition for a writ of certiorari, she said.

Abolfazli also noted that the two cases granted review and vacated by the Supreme Court were decided before Hobby Lobby, while those in which review is likely to be sought soon were decided after. Parties interested in the issue are in a “waiting pattern” at this point, she said.

Currently, there is no circuit split, Abolfazli said, referring to one of the high court's chief reasons for granting review. If one of those other circuits should decide the other way in a more recently argued case, resulting in a split, the court might be more likely to grant review, she said. On the other hand, if those circuits agree with the decisions to date, there would be less reason for the high court to consider the issue.

To contact the reporter on this story: Mary Anne Pazanowski in Washington at mpazanowski@bna.com

To contact the editor responsible for this story: Fabia Mahoney at fmahoney@bna.com

Text of the Sixth Circuit's opinion is at http://www.bloomberglaw.com/public/document/Michigan_Catholic_Conference_et_al_v_Sylvia_Matthews_Burwell_et_a/2. The petition for review is at http://op.bna.com/hl.nsf/r?Open=mapi-9vypvb.