Women’s Contraceptive Coverage under the Affordable Care Act (ACA) – Update

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:

1. Exemption – The employer objects to any coverage for some or all women’s contraceptive methods.
   
   
2. 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.
   
   

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Employer	Religious Exemption or Accommodation Available	Moral Exemption or Accommodation Available
Church	Yes	No
Other nonprofit	Yes	Yes
Closely held for-profit	Yes	Yes
Other for-profit	Yes	Yes/No*
Other non-government	Yes	No
Government	No	No
Higher Education	Yes	Yes
Insurance carrier**	Yes	Yes

* A moral objection is not available to publicly traded entities.

** An insurance carrier is sheltered by the employer/plan sponsor’s objection.

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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).[1] 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.