Mandate withstands religious challenge, providing contraceptives has ‘nothing to do with it’

The Fifth Circuit held that the EBSA Form 700 accommodation to the contraceptive mandate under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) did not violate the Religious Freedom Restoration Act (RFRA) (42 U.S.C. § 2000bb) because it did not require religious organizations to provide or facilitate access to contraceptives. The court held that several religious organizations, who did not qualify for the ACA’s religious exemption, were not burdened by the accommodation because the accommodation only imposed burdens on third parties and the RFRA provided no opportunity for religious organizations to challenge the independent conduct of third parties (East Texas Baptist University v. Burwell, June 22, 2015, Smith, J.).

Mandate

Under the ACA, employers with fifty or more full time employees must offer a health plan for employees that includes “minimum essential coverage.” As part of this, plans typically are required to cover all FDA-approved contraceptive methods without copayments or deductibles. Religious employers—those that are defined as religious under the tax code—are automatically exempted from this requirement. The penalties for noncompliance are significant, “$2,000 per full-time employee per year for not offering a plan at all and $100 per affected individual per day for offering a plan that provides insufficient coverage.”

Accommodation

An accommodation is available to religious entities that do not qualify as religious employers but seek an exemption from the mandate. Those organizations can either execute an EBSA Form 700, certifying that it is a nonprofit entity holding itself out as a religious organization and that it opposed the provision of contraceptive services, or notify HHS in writing with the name of the organization, the nature of the objection, and certain plan information.

ESBA Form 700

East Texas Baptist University, Houston Baptist University, Westminster Theological Seminary, University of Dallas, the Catholic Diocese of Beaumont, Catholic Charities Diocese of Fort Worth, and the Catholic Charities of Southeast Texas Incorporated opposed the ACA mandate on religious grounds because they oppose abortion and believe that emergency contraceptives and intrauterine devices, which are included in the contraceptive mandate, can cause abortions. Some of the organizations, including East Texas Baptist did not meet the ACA’s religious employer exception. The religious organizations filed suit in several district courts within the Fifth Circuit’s jurisdiction seeking an injunction to halt the requirements of the contraceptive mandate and accommodation. In each of the lawsuits filed by the organizations, either a preliminary or permanent injunction was granted by a district court in favor of the religious objections.

Burden test

The Fifth Circuit evaluated whether the injunctions were appropriately granted by considering the ACA mandate and accommodation in light of the RFRA. The court began and ended its analysis by holding that the religious employers did not establish that the mandate or the accommodations substantially burdened their religious exercise or that they could make such a showing. The court reasoned that the question of a substantial burden on religious exercise was composed of three questions: (1) what is the adherent’s religious exercise, (2) does the challenged law pressure him to modify that exercise, and (3) is the penalty for noncompliance substantial? The court accepted at the outset that the beliefs were sincerely held and religious.

Precedent

The court relied on Supreme Court precedent (Bowen v. Roy, S.Ct., January 14, 1986) to highlight the fact that “the Free Exercise Clause simply cannot be understood to require the Government to conduct its own internal affairs in ways that comport with the religious beliefs of particular citizens.” As a result, the court reasoned that the relevant analysis was whether “the challenged law pressures the objector to modify his religious exercise.” Notably, the court found that the Supreme Court’s decision in n Burwell v. Hobby Lobby Stores, Inc. (Hobby Lobby), where the court held that the mandate violated the RFRA with respect to corporations that were neither automatically exempt from the mandate as religious employers nor eligible for the accommodation, was not instructive because the Hobby Lobby Court did not address the second question of the substantial burden analysis.

Nothing to do with it

The court ultimately found that although the religious employers were able to identify acts that offended their religious views, the court held that the RFRA was not implicated because, due to the accommodation, the objectionable acts were acts performed by third parties and not the religious organizations themselves. The court simply held that the RFRA “confers no right to challenge the independent conduct of third parties.” The Fifth Circuit rejected the argument that by taking part in the accommodation process the organizations were somehow triggering payment or authorization of contraceptives. The court held that the triggering argument was not persuasive because the insurers or third-party administers who become responsible for the administration of the contraceptive benefits under the health plan are required by law to provide those services anyway. The court succinctly dismissed the organizations’ challenges by saying the accommodation challenged by the religious organizations “has nothing to do with providing contraceptives.”

Ripe

The court rejected an additional argument from the religious employers that “third-party administrators will attempt to charge them for contraceptives.” The court identified that the employers’ concerns may not come to pass and, as such, rendered the issue not fit for judicial decision. The court also rejected arguments from two of the organizations who qualified as religious employers and were exempt from the mandate because the court found that the accommodation in no way burdened the religious exercise of those exempt organizations.