Supreme Court Holds That The ACA Mandate To Include Group Health Coverage For Certain Contraceptives Violates The Religious Beliefs


On June 30, 2014, the U.S. Supreme Court ruled in a 5-4 decision that closely held, for-profit corporations may claim a religious exemption from the Affordable Care Act’s (ACA) mandate of providing certain types of contraceptives at no cost to employees. The plaintiffs, Hobby Lobby Stores, Inc. and Conestoga Wood Specialties Corp., sought relief from this ACA mandate on religious grounds.  The plaintiffs claimed, among other arguments, that a corporation could claim freedom of religious expression under the Religious Freedom Restoration Act of 1993 (RFRA) in order to avoid the ACA mandate.  RFRA prohibits the government from imposing a substantial burden on a “person's” exercise of religious freedom unless the government proves that this burden furthers a compelling government interest and is the least restrictive means of furthering that compelling governmental interest. The court held that RFRA applies to a for-profit corporation, noting that: (i) a “person,” for purposes of the application of RFRA, includes a for-profit corporation; and (ii) given that courts have recognized that non-profit corporations have freedom of religious expression, no substantial reason exists to conclude that a for-profit corporation should be denied that same freedom.  After agreeing that the ACA contraception mandate furthered a compelling governmental interest, the court determined that the ACA mandate was not the least restrictive means of achieving this governmental interest.  The Department of Health and Human Services had already conceived of a less restrictive alternative for religious organizations which, the court noted, could be extended to for-profit corporations to ensure cost-free access to the contraceptives at issue.  Finally, the court clarified that the decision pertains only to the mandate to provide certain contraceptive coverage; it does not apply to other mandates that may conflict with an employer's religious beliefs, such as coverage for immunizations or blood transfusions. Although the dissent strongly emphasized the concern that for-profit corporations may use religious beliefs to effectuate discriminatory practices based on this decision, the majority opinion addressed this notion by stating that this decision does not provide a “shield for employers who may cloak illegal discrimination as a religious practice."

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