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Supreme Court upholds ACA contraceptive coverage mandate exemptions

Benefits Administration and Outsourcing|Health and Benefits

By Maureen Gammon and Rich Gisonny | July 24, 2020

The ruling allows employers with religious and moral objections to opt out of contraceptive coverage.

On July 8, 2020, in a 7 – 2 ruling, the U.S. Supreme Court upheld regulations exempting certain employers with religious and moral objections from the Affordable Care Act’s (ACA’s) contraceptive coverage mandate. In Little Sisters of the Poor v. Pennsylvania, the Supreme Court reversed an opinion by the Third Circuit Court of Appeals and concluded that:

  • The final rules were validly issued by the departments of Health and Human Services, Labor and Treasury because the departments satisfied the procedural requirements under the Administrative Procedure Act.
  • The departments had broad statutory authority to define preventive services and exempt those with religious or moral objections to contraceptive coverage from having to comply with the ACA mandate.

Under the ACA, non-grandfathered group health plans are required to provide participants with certain preventive care services without imposing any cost sharing. With respect to women, these services include preventive care and screenings provided for in guidelines supported by the Health Resources and Services Administration. These include, in part, all Food and Drug Administration-approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity, as prescribed by a health care provider (collectively referred to below as contraceptive services).

Following previous Supreme Court decisions and a 2017 executive order from President Trump, the departments issued a pair of interim final regulations (IFRs) that significantly expanded on available exemptions from the ACA’s contraceptive coverage mandate. The IFRs exempted:

  • Non-governmental, nonprofit and for-profit employers (including publicly traded companies) with sincerely held religious objections to contraceptive coverage
  • Non-governmental, nonprofit and for-profit employers (without publicly traded ownership interests) that have a moral objection to contraceptive coverage

The IFRs also provided an optional accommodation process that allowed eligible entities to comply with the ACA contraceptive coverage mandate but avoid having to actually provide contraceptive services directly to participants.

Final regulations, which were issued in 2018, did not significantly differ from the IFRs.1 Legal challenges against the rules resulted in a nationwide preliminary injunction, preventing them from going into effect. The Third Circuit Court of Appeals affirmed the injunction, a decision that was appealed to the Supreme Court by the Trump administration and Little Sisters of the Poor, which had intervened in the litigation.

While the Supreme Court’s decision lifts the nationwide injunction imposed by the Third Circuit, allowing the final rules to go into effect, litigation over the ACA’s contraceptive coverage mandate is expected to continue. Employers should review the final regulations and discuss next steps with legal counsel.


1 See “Agencies issue final regulations on contraceptive coverage exemptions,” Insider, November 2018.

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