Other MMA Content
Author: Jennifer Stanley is the Legislative & Health Reform Director for the Employee Health & Benefits practice in Marsh & McLennan Agency’s Southwest Region.
Final Regulations for Religious and Moral Objections Released
In May 2017, President Trump issued an executive order directing the Departments of Health and Human Services, Treasury, and Labor (the “Departments”) to consider amending the ACA’s preventive services mandate to provide conscience-based objections to the included women’s contraceptive services. The preventive services mandate applies to ACA non-grandfathered group health plans, and a number of employers have maintained grandfathered status for their group health plans at great cost primarily because of objections to providing women’s contraceptive services. In response to the executive order, the Departments issued interim final regulations in October 2017. In December 2017, two federal district courts granted nationwide temporary injunctions from enforcement of the interim final regulations.
On November 7, 2018, the Departments released final regulations in two parts: (1) objections for religious beliefs; and (2) objections for moral convictions (collectively, “the Rules”). The Rules are substantially similar to the interim final regulations but make certain technical changes for clarity. It is worth noting that the Rules do not affect government programs that provide free or subsidized contraceptive coverage to low income women, such as through community health centers. The Rules also do not ban any contraceptive drugs or devices nor prohibit any employer or insurer from covering contraceptives.
The Rules take effect January 14, 2019. In the short term, it seems likely there will be a legal skirmish over whether the previously issued nationwide injunctions will remain in effect or if the states challenging the religious and moral objections will be required to file new lawsuits. We expect the parties will be permitted to adapt the existing lawsuits to the Rules and the nationwide injunctions will be allowed to stand while the lawsuits proceed. In the meantime, this means employers will be unable to claim a religious or moral objection to providing the mandated women’s contraceptive services.
Objections for Religious Beliefs and Moral Objections
The objection for religious beliefs provides relief from the contraceptive coverage mandate to employers that object to contraceptive services on the basis of sincerely held religious beliefs. The objection for moral convictions is intended to provide similar relief for employers that lack a basis to claim a religious objection to providing women’s contraceptive services.
Relief is available in two forms:
- Exemption – The employer objects to any coverage for some or all women’s contraceptive methods.
- Accommodation – The employer is willing to allow coverage for some or all women’s contraceptive methods through a third party but objects to providing directly through its plan or paying for services.
|Employer||Religious Exemption or Accommodation Available||Moral Exemption or Accommodation Available|
|Closely held for-profit||Yes||Yes|
* A moral objection is not available to publicly traded entities.
** An insurance carrier is sheltered by the employer/plan sponsor’s objection.
Exemption and Accommodation Processes
Surprisingly, there is no filing requirement to claim an exemption. That said, employers claiming an exemption should consider keeping a written record of the basis for its exemption in the event of a challenge.
An employer claiming an accommodation shifts the responsibility (and cost) for providing women’s contraceptive services to the employer’s plan participants to the insurance carrier or third party administrator (TPA). An employer claiming an accommodation must either file EBSA Form 700 (a previous version based on the interim final regulations is available here) or provide other written notice to HHS of its objection to coverage of all or a subset of contraceptive services. Obviously, an accommodation also requires coordination between the employer and its insurance carrier or TPA. Employers who previously self-certified or filed other written notice do not need to file a new self-certification or notice.
Employers that object to covering some, but not all, contraceptive methods may only claim an exemption or accommodation for those methods to which they object.
 In theory, the absorbed costs will be offset by a reduction in fees paid to participate in the public health insurance exchange, but this doesn’t benefit insurance carriers/TPAs that do not participate. Those insurers/TPAs may pass those costs on elsewhere.
The information contained herein is for general informational purposes only and does not constitute legal or tax advice regarding any specific situation. Any statements made are based solely on our experience as consultants. Marsh & McLennan Agency LLC shall have no obligation to update this publication and shall have no liability to you or any other party arising out of this publication or any matter contained herein. The information provided in this alert is not intended to be, and shall not be construed to be, either the provision of legal advice or an offer to provide legal services, nor does it necessarily reflect the opinions of the agency, our lawyers or our clients. This is not legal advice. No client-lawyer relationship between you and our lawyers is or may be created by your use of this information. Rather, the content is intended as a general overview of the subject matter covered. This agency is not obligated to provide updates on the information presented herein. Those reading this alert are encouraged to seek direct counsel on legal questions. © 2018 Marsh & McLennan Agency LLC. All Rights Reserved.